In today’s competitive commercial environment, businesses often need to reference a competitor’s product – whether to highlight differences, assert compatibility, or position themselves advantageously. U.S. trademark law accommodates limited, legitimate uses of a competitor’s mark under the doctrines of nominative fair use and comparative advertising. This article outlines the core principles of trademark fair use, examines instructive case law, and offers practical guidance for compliant marketing practices.

• Understanding Trademark Fair Use

Trademark fair use encompasses two key doctrines: nominative fair use and comparative advertising. These are not loopholes but structured defenses that apply under specific, fact-dependent circumstances.

• Nominative Fair Use: Identifying the Competitor’s Product

Nominative fair use allows a business to use another’s trademark to identify the trademark owner’s goods or services, provided the use is limited and does not mislead consumers. Courts generally consider nominative fair use lawful if:

• The product or service is not readily identifiable without use of the mark;
• Only so much of the mark is used as is reasonably necessary; and
• The use does not suggest sponsorship, endorsement, or affiliation.

For instance, a repair service stating, “We fix iPhones,” is not likely to infringe Apple’s trademark—so long as it avoids stylized logos or branding that implies Apple’s approval. This principle was central in James v. American Pacific University, where the court issued a temporary restraining order to prevent misuse of a personal brand and associated trademarks after finding a likelihood of consumer confusion and limited fair use rights by the defendants (2006 WL 8436132, D. Haw. 2006)​.

Similarly, in Tracfone Wireless, Inc. v. Clear Choice Connections, Inc., nominative fair use did not shield a reseller’s use of Tracfone’s mark in domain names like “TracfoneDeals.com,” as it overstated the need for use and falsely suggested affiliation—pushing the use beyond the safe harbor. 102 F. Supp. 3d 1321 (S.D. Fla. 2015)​.

• Comparative Advertising: Lawful Competitive Comparisons

In Tempur-Pedic N. Am., LLC v. Mattress Firm, Inc., the defendant used Tempur-Pedic’s trademark in comparative advertising, including a dedicated webpage and sponsored search ads. The court acknowledged that such uses, while controversial, may qualify as nominative fair use if they are carefully presented to avoid confusion about endorsement or affiliation (CIVIL ACTION H-17-1068, S.D. Tex. Jul. 11, 2017)​.

However, even in comparative contexts, courts scrutinize whether disclaimers are sufficiently prominent and whether the overall presentation avoids misleading implications. The presence of detailed disclaimers and removal of logos or stylized branding were crucial to mitigating liability in that case.

• Actionable Strategy

• Best Practices

These fair use doctrines are defenses – not blank checks. A company asserting them must be prepared to show that the use was both necessary and appropriately limited. The following best practices can help businesses stay within the bounds of lawful use:

• Limit the reference to plain text: Avoid logos, proprietary fonts, or design elements.
• Disclaim affiliation: Clearly and conspicuously state that there is no relationship with the trademark owner.
• Use only what’s necessary: Minimal use of the competitor’s name suffices for clarity.
• Present only verifiable facts: Avoid subjective claims that could be construed as misleading.
• Avoid using marks in domain names or social media handles: Courts, including in Volkswagen Grp. of Am. v. Varona, have consistently found that such uses imply affiliation and may support a finding of infringement—especially when counterfeit goods are involved (CASE NO. 19-24838-CIV, S.D. Fla. Jan. 25, 2021)​.

• What Courts Caution Against: Missteps and Liability

Cases involving misuse of trademarks consistently underscore the importance of avoiding confusion – particularly regarding affiliation or sponsorship. In Dr. Ing. h.c.F. Porsche AG v. Universal Brass, Inc., a company reproduced Porsche’s registered trademarks on unauthorized merchandise. Although disclaimers were present, the court found the use misleading due to reproduction of registered marks and the presence of the ® symbol, granting summary judgment for Porsche on claims of trademark infringement and false designation of origin (1995 WL 420816, W.D. Wash. 1995)​.

These decisions make clear that disclaimers, while helpful, are not a cure-all, particularly when combined with prominent use of another’s mark in a commercial setting.

• Final Considerations: Compete Confidently, But Lawfully

Referencing a competitor’s trademark in advertising or product descriptions can be lawful when executed with restraint, transparency, and fidelity to the underlying facts. The key is to avoid any implication of endorsement, sponsorship, or source confusion.

Marketing and legal teams should collaborate closely when preparing comparative messaging or referencing competitors’ brands. Legal counsel should review campaigns in advance to ensure adherence to fair use principles—before a dispute arises.

When done right, nominative fair use and comparative advertising allow companies to sharpen their competitive messaging while maintaining compliance with trademark law, a strategy that fosters both marketplace clarity and legal protection.

Click HERE to learn more about Derek Fahey, Esq., the author of this article.