In Toro Co. v. ToroHead Inc. , the Trademark Trial and Appeal Board interpreted, at length, the Federal Trademark Dilution Act of 1995 (FTDA).

The Toro Company had opposed registration of the applicant's proposed mark ToroMR & Bull's Head Design for "very low reluctance, thin film magnetic reading and writing heads for sale to OEM manufacturers of high performance computer disk drives", on the grounds of dilution and likelihood of confusion with the opposer's TORO marks for a variety of goods and services, including lawn mowers, irrigation systems, blower vacuums and string trimmers. No likelihood of confusion was found.

With respect to the dilution claim, the Board first noted that, in a use-based application, the party alleging fame must show that the mark had become famous prior to the applicant's use of the mark. In the case of an intent-to-use application, however, the question was by what date did the opposer have to prove that its mark had become famous. In order to harmonize the constructive use provisions of the Trademark Act with a dilution claim, the Board held that, in a case involving an intent-to-use application, where there has been no actual use, the opposer (or cancellation petitioner) must establish that its mark became famous prior to the filing date of the application. (In dictum, the Board also held that the same rule would apply in a cancellation action filed against a registration initially filed as an intent-to-use application.)

The Board then considered the factors set forth in the FTDA used in determining whether opposer's TORO mark was famous for FTDA purposes. While noting that the evidence showed that opposer's mark had achieved some distinctiveness, the Board noted that opposer had presented little evidence of widespread recognition outside its specific trading fields and little evidence of how famous the mark was among potential purchasers of the opposer's consumer products beyond evidence relating to advertising and sales figures and the opposer's unsupported assertions of fame. There was also no evidence that purchasers of thin film heads were also potential purchasers of the opposer's goods and services or were even familiar with the opposer's mark.

The Board concluded that opposer had not submitted sufficient evidence to support a finding that its TORO marks were "famous" for FTDA purposes, namely that there was such a "powerful consumer association" between TORO and opposer that the use of a similar mark on non-competitive goods and services would dilute their value. The Board held that an opposer asserting a claim under the FTDA must demonstrate that, when the public encounters its mark in almost any context, it immediately associates the mark with the opposer. The Board cited recognition by the other party, intense media attention and surveys as examples of evidence establishing the fame of a mark.

Lastly, the Board held that, in any event, there was no showing that the opposer's mark had been "diluted", looking to such relevant factors as (1) the similarity of the marks, (2) the renown of the opposer's mark, and (3) whether target customers are likely to associate two different products with the mark, even if they are not confused as to the different origins of the products.