Luxury Goods

Souvenir Company’s Copyright Suit Against Balenciaga Shows Need for Luxury Goods Companies to Undertake Due Diligence

Usually, luxury goods companies are the victims of knockoffs and infringements – an expensive fashions item is copied by a cheap imitator.  However, an interesting twist has come up in a recent copyright suit against Kering’s Balenciaga. A souvenir company selling cheap souvenirs claims copying by the fashion company, at prices 100 times the original!

The takeaway is that high-end companies should not assume that they are immune from getting into trouble by copying others’ designs.  While new designs are the lifeblood of fashion, counsel’s due diligence before they are introduced can avoid major legal headaches.  And, once a charge of copying is made, ignoring it would only make matters worse.  These are lessons that Balenciaga may now learn the hard way.

LVMH’s Kenzo Sued by Levi Strauss Raises Issues of When There Is Confusion

A recent trademark suit brought by Levi Strauss against Paris luxury house Kenzo raises interesting questions of trademark infringement and when use of a product design may infringe upon another’s design trademark.

On March 20, 2018 Paris luxury house Kenzo, owned by LVMH, introduced a new line of jeans, shorts, and overalls named the Kenzo Britney Spear line.  This line bears a pocket-tab with the word KENZO.  Shortly thereafter, Kenzo was sued for trademark infringement by the famous jeans maker Levi Strauss. Levi Strauss’ core claim is that it owns trademark rights in a pocket-tab design, and Kenzo is infringing those rights by selling apparel items that have a very similar tab. 

Court Allows Forever 21’s Second Amended Complaint Against Gucci to Proceed

In a prior post, we discussed Forever 21’s lawsuit against Gucci in federal court in Los Angeles, seeking to cancel Gucci’s registrations for its Blue-Red-Blue and Green-Red-Green striped marks, and for a declaration that its clothing and accessory products that incorporate similar striping are not infringing. 

As we noted there, the suit raises many issues of trademark law around Gucci’s rights in these designs. Among the issues of Gucci’s rights in the designs include whether the designs function as trademarks; whether they have achieved sufficient recognition and association with Gucci exclusively; and whether the designs are “aesthetically functional,” meaning that there is a competitive need to permit their use by others. 

The issues of infringement raised by the case include whether Gucci will be able to establish consumer confusion, either at the point of sale or in the post sale context, whether Forever 21’s house mark dispels confusion, and whether there is a claim for trademark dilution.  The complexity of the issues stems from the fact that trademark rights are not the right to exclude others from use of a word or symbol, but the right to prevent consumer confusion or deception. 

Vuitton Win Against LVL XIII Highlights Fashion Startup Challenges in Protecting Their Designs

Louis Vuitton scored a win against start-up sneaker manufacturer LVL XIII, when a federal appeals court affirmed dismissal of the latter’s trade dress suit against Vuitton.  The case illustrates the difficulty of protecting new designs, particularly for small fashion and luxury goods startups. 

LVL XIII asserted “trade dress” rights in its design of a metal plate at the sneakers’ toe-end – meaning that the design functions as its trademark by identifying the sneakers as it brand.  But such claims require a strong showing of consumer association – that the public identifies the design with a single brand owner.  That takes time and significant investment of resources to promote and market the design.  

As LVL XIII learned to its chagrin, until a high level of consumer association is reached, others are free to copy.  And, the very act of copying by others takes away from exclusivity in the design, which can destroy any chance of reaching the required consumer association.  This can be especially challenging to small design companies.

Design companies need a strategy for protection.  They should consider using additional forms of intellectual property to protect the designs.  These rights include design patents and copyright, neither of which require a showing of consumer recognition.  That then allows time for the company to build up consumer recognition in the design and gain trade dress rights.

Forever 21 Amended Complaint Against Gucci Highlights the Need for Vigilant Enforcement to Maintain Trademark Rights

In a prior post, we discussed Forever 21’s lawsuit against Gucci, seeking to cancel Gucci’s registrations for its Blue-Red-Blue and Green-Red-Green striped marks, and for a declaration that its clothing and accessory products that incorporate similar striping are not infringing.

In response to a dismissal by the court, Forever 21 filed a massive, 145-page amended complaint. The complaint mostly repeats the same allegations, but now also includes over 100 pictured examples of products sold by other brands and retailers, including Nordstrom, Bloomingdale’s, Tory Burch, J.Crew, Louis Vuitton, and Balenciaga.

Forever 21’s argument is that Gucci’s striped designs are not perceived as trademarks, but are merely decorative elements used by numerous brands across a wide range of price points.

While it remains to be seen how strong Forever 21’s proofs are, this argument raises an important point for trademark owners. “Enforce it or lose it” is the takeaway here.

Trademark owners who wish to keep their rights in their marks need to vigilantly police the market and make sure that their marks do not lose their source-identifying power through widespread use.

Recent Copyright Decisions Highlight Need to Rethink IP Protection Strategies for Product Designs

Many industries, from fashion and luxury, to consumer goods to industrial goods, use unique and innovative product designs to set themselves apart from the competition and provide an aesthetic attractive product for their customers.   Protection of innovative designs against competitors and knockoffs is an important part of their business strategy.  Such designs traditionally were protected by design patents. 

But the Supreme Court’s decision earlier this year in Star Athletica LLC v. Varsity Brands Inc., 137 S.Ct. 1002 (2017), seemingly expanded the scope of copyrightable designs that are incorporated into useful articles.  Subsequent district court cases further elucidate how that case is to be applied, and its effect on the scope of copyright protection.  These decisions point to a need to rethink protection strategies for product design, and consider increasing use of copyright protection.

3 Takeaways from the Tiffany Verdict Against Costco for Misuse of Marks

A court decision in a trademark case awarded substantial damages in favor of luxury jeweler Tiffany against discount wholesale warehouse marketer Costco for misuse of the TIFFANY mark on jewelry. The decision teaches several valuable lessons in trademark enforcement:

  • Generic Meaning Is Not A Free Pass To Infringement

Although it was conceded that “Tiffany Setting” is a generic term in the jewelry industry, Costco was still found to be an infringer for confusing use of the TIFFANY mark.

  • Courts Will Look At The Entire Story To Assess Bad Faith

In trademark cases, bad faith can be a major factor both in finding infringement and obtaining enhanced damages. In the Tiffany case, Tiffany used both undercover investigation and discovery to build a compelling case of bad faith – by examining the total circumstances of Costco’s marketing strategy for jewelry.

  • Look To The Full Value Of Infringements In Assessing Profits

Trademark owners generally seek the defendant’s profits as damages. Profits may include not only the immediate profits on infringing goods, but the secondary profits gained by using infringing luxury goods to draw customers into the store. In Costco’s case, the court found that the jewelry items were used as a draw to gain members, and a portion of Costco’s membership fees were also awarded as part of the damages – increasing the award by close to four times.

Macy’s Trademark Decision Confirms Importance of Surveys

Trademark cases turn on public perception – of the asserted trademark by the purported owner, and of the use by the accused infringer of the accused infringing mark. Unless the case is very small, or the infringement is very clear (in a counterfeiting case, for example), to prevail in a trademark litigation, a party will need to commission a legally valid confusion survey.

A recent trademark dispute between fashion retailer Macy’s and British luxury brand Joules Ltd. involved competing marks.

The case illustrates the potential flaws that a trademark survey may suffer from, and the importance of designing and executing a survey in a way that will likely be accepted by the courts.

Supreme Court Presents Luxury Goods Owners with Expanded Copyright Protection Opportunities

Last week’s Supreme Court decision in Star Athletica LLC v. Varsity Brands Inc. (March 22, 2017) presents an opportunity for the luxury goods and fashion industry to secure expanded copyright protection for certain creative designs. The Court ruled that geometric designs applied to cheerleader uniforms could be protected by copyright.


The Court’s ruling clarifies and simplifies copyright protection of decorative features of useful objects, including such common fashion staples as clothing and accessories. This expanded protection should be factored into any design protection strategy.

Missed Opportunities to Clarify Analyses for Design Patents

In a pair of recent decisions, issued two weeks apart, the Court of Appeals for the Federal Circuit (CAFC) delved further into the thicket of design patent issues in attempting to clarify how one is to determine whether a design patent has been infringed.  One might think that determining whether a design patent has been infringed should be a relatively easy endeavor.  Yet, the CAFC’s two most recent forays into design patent jurisprudence demonstrate, again, that litigants and the courts continue to struggle with this issue.

Distinct Points-of-Novelty Test for Design Patents Ends

Four years ago we wrote about the rising importance of design patents to the fashion and luxury goods communities and the increasing prevalence of design patents as the subject of litigation.   At that time, in order to prevail on a claim of design patent infringement, a plaintiff was required to satisfy two tests: (1) the ordinary observer test, and (2) the points of novelty test.  For over two decades patent holders and accused infringers have complained that the points of novelty test was unworkable. 

Responding to the complaints, the Court of Appeals for the Federal Circuit (CAFC) recently abolished that test and ushered in a new era of design patent law.  Egyptian Goddess, Inc. v. Swisa, 543 F.3d 665 (Fed. Cir. 2008).