A more thorough explanation:

Definition: The Dilution Act, also known as the Federal Trademark Dilution Act, is an amendment to the Lanham Act that was passed in 1995. It provides additional legal protection against the dilution of famous trademarks.

For example, if a company has a well-known and distinctive trademark, such as Coca-Cola or Nike, the Dilution Act can be used to prevent other companies from using similar marks that could weaken the original trademark's distinctiveness and value.

The Dilution Act is important because it helps to protect the reputation and value of famous trademarks, which can be worth millions or even billions of dollars. By preventing dilution, the Act helps to ensure that consumers can easily identify and trust the products and services associated with these trademarks.