For more than three decades, courts have been grappling with whether to hold trademark licensors liable for defective products even where they neither manufactured nor sold defective products. It appears that courts are reaching a consensus concerning the relevant considerations regarding this liability issue.
This article discusses the interplay between the Lanham Act, which permits licensors to retain their trademarks if they do not completely abandon them, and courts’ imposition of liability on trademark licensors who appear to exercise too much control. This article also examines recent cases concerning product liability of trademark licensors. Finally, this article makes recommendations to the wary trademark licensor on how best to avoid the pitfalls courts are now beginning to delineate.
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