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A rival lawn equipment marketer cannot use a computer-altered parody of the Deere & Co. logo in comparative ads, a federal appeals court decided.

The 2nd U.S. Circuit Court of Appeals in New York upheld a lower court's ruling that MTD Products' parody represented unfair trademark dilution under New York law (AA, Sept. 12).

The TV spot from W.B. Doner & Co., Cleveland, showed an MTD Yard Man riding mower chasing an animated deer closely resembling the logo of Deere. A voice-over claimed the Yard Man "doesn't cost nearly as much money" as the competitor's model.

While the appellate court found that parody and satire in advertising are protected under the First Amendment, "some alterations in the context of competitive products have the potential to so lessen the selling power of distinctive marks they are appropriately proscribed by dilution statute."

"It's really quite a good decision," said Deere attorney Richard Kurnit. "They note that it's new law that they're making."

The decision bars Cleveland-based MTD from airing its ads within and out of New York state, thus barring the ads from the TV networks. In a separate ruling, the court refused to extend the injunction barring MTD from broadcasting the ad in spot markets.

MTD counsel Patricia Hatry said an appeal is unlikely. The company hasn't decided if it will broadcast the ad in spot markets.

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