62 Stan. L. Rev. 413 (2009-2010)
Trademark law centers its analysis on consumer confusion. With some significant exceptions, the basic rule of trademark law is that a defendant’s use of a mark is illegal if it confuses a substantial number of consumers and not otherwise.
As a general matter, this is the right rule. Trademark law is designed to facilitate the workings of modern markets by permitting producers to accurately communicate information about the quality of their products to buyers, and therefore to encourage them to invest in making quality products in circumstances in which that quality wouldn’t otherwise be apparent. If competitors can falsely mimic that information, they will confuse consumers, who won’t know whether they are in fact getting a high quality product and therefore won’t be willing to pay as much for that quality. I won’t pay as much for an iPod if I think there is a chance it is a cheap knock-off masquerading as an iPod.
The law of false advertising operates as an adjunct to trademark law. While trademark law prevents competitors from misrepresenting the source of their products by mimicking another’s brand name, the law of false advertising prevents false or misleading statements about the quality of one’s own or a competitor’s products. Like trademark law, false advertising law is designed to protect the integrity of markets by allowing consumers to rely on statements made by sellers.
McKenna, Mark and Lemley, Mark A., "Irrelevent Confusion" (2010). Journal Articles. 588.