A trademark owner’s sale of a branded product generally exhausts the right to control the resale or other disposition of that product under the First Sale Doctrine. However, where that branded product is altered, the First Sale Doctrine does not necessarily apply, because the product being resold is no longer the same product that was sold by the brand owner. Thus, repair, refurbishing, and upcycling present questions not addressed by the First Sale Doctrine.
The original branded product may so altered by the repairing, refurbishing, or upcycling, that the subsequent resale of the altered product with the original trademark intact could cause confusion about the source of the altered product. In these circumstances, a conventional multifactor likelihood of confusion analysis is not conclusive because the confusion depends upon additional factors relating to the nature of the changes to the branded product, and the public’s understanding of those changes.
Veteran IP attorney Bryan Wheelock analyses a number of matters involving modification in a recent World Trademark Review article – including the high-profile Nike Satan Shoes litigation – to show the subtle nuances on which a finding of infringement can hinge in this grey area.