Veblen Brands

Abstract

The trademark doctrine of post-sale confusion is a creation of the lower federal courts that has never been accepted, or even considered, by the Supreme Court. This article argues that the doctrine should be discarded. Courts use the term “post-sale confusion” inconsistently to refer to three different species of liability, each of which suffers from some fundamental infirmity. The first species, which I label “bystander confusion,” is theoretically sound but in practice imposes liability based on mere speculation. The second species, which I label “downstream confusion,” conflicts with long-standing Supreme Court precedent regarding contributory infringement and the first sale doctrine. The final species, which I label “status confusion,” is theoretically inconsistent with other areas of trademark law. Status confusion extends the information economics theory that undergirds trademark law beyond its traditional application to information about products and into the realm of information about people. In so doing, status confusion invokes the aid of the state in privileging some speakers over others in social, rather than commercial, discourse. The article concludes by framing the legal and theoretical issues raised by this unique area of trademark law, concluding that it is unsupportable as a matter of trademark policy and First Amendment law.

Keywords: Trademark, Veblen, Conspicuous Consumption, Luxury Goods, Status Goods, Post-Sale Confusion

JEL Classification: K00, M31, D82, D83, L15