What is 'tarnishment' in trademark law?

'Tarnishment' in trademark law refers to a situation where the distinctiveness or reputation of a trademark is harmed due to its association with inferior goods or services, or with immoral or scandalous contexts. This typically occurs when a trademark is used in a way that generates a negative impression about the brand it represents.

In this context, answer B is correct because it specifically addresses the impact of such negative associations on the famous company. If the public begins to perceive the brand negatively as a result of improper use, the trademark's value and goodwill can be diminished. This concept is particularly relevant for famous marks that enjoy a high level of recognition and protection under trademark law, as they are afforded greater safeguards against tarnishing.

Understanding tarnishment is crucial for businesses seeking to maintain their trademark's integrity, as it highlights the importance of controlling how and where their trademarks are used.