Traditionally, trademark and unfair competition laws have protected trademark owners against unauthorized uses of their marks that are likely to confuse or mislead consumers about the origin of goods or services. If a particular use is not likely to confuse or mislead, then it is not actionable under traditional infringement regimes. When applied to commercial speech, as opposed to noncommercial expression, traditional trademark and unfair competition laws generally have survived scrutiny under the First Amendment, because these laws restrict only commercial speech that is false or misleading.
Dilution laws, however, do not restrict speech that is false or misleading. Dilution laws were enacted to address a perceived gap in trademark law by enabling the owner of a famous trademark to prevent the unauthorized use of its mark even if that use is neither misleading nor confusing. Instead, dilution laws protect the owners of famous trademarks against types of harm that arise even in the absence of consumer confusion.
This article argues that the federal dilution statute, as well as most state dilution statutes, are unconstitutional restrictions on commercial speech. Under the standards established by the Supreme Court in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, dilution laws violate the First Amendment because they restrict commercial speech without advancing any substantial government interest.
58 S.C.L. Rev. 709 (2007).
LaFrance, Mary, "No Reason to Live: Dilution Laws as Unconstitutional Restrictions on Commercial Speech" (2007). Scholarly Works. Paper 430.