counterfeiting

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.

Knockoffs: Creating an Effective Strategy on a Tight Budget

Part IV: Implementing an Effective and Cost-Efficient Enforcement Strategy

This is the fourth in our four-part series about developing an effective strategy to deal with knockoffs and counterfeits when faced with a limited budget.  We assume that each of the three steps outlined in our prior posts  have been implemented and are used to inform and support the company’s enforcement efforts.

Planning an appropriate company enforcement strategy is not a once-size-fits-all approach.  As the scope and prioritization of the knockoff problem vary, so too will the company’s enforcement plan. We outline the main issues to be considered and determined as steps in designing an enforcement strategy:

Knockoffs: Creating an Effective Strategy on a Tight Budget

Part III: Securing the IP Foundation

This is the third in our four-part series about developing an effective strategy to deal with knockoffs and counterfeits when faced with a limited budget.  In this post, we discuss how to ensure the company has a proper IP foundation well before embarking on enforcement. 


For a number of reasons, having a proper IP foundation is crucial – but one reason which runs counter to most people’s thinking stands out above all.  In American law, in the absence of a positive right, copying is both permitted and encouraged.  


No less than the United States Supreme Court has opined: “in many instances there is no prohibition against copying goods and products. In general, unless an intellectual property right such as a patent or copyright protects an item, it will be subject to copying.”


Luxury goods companies generally rely upon four types of IP.   We outline here the due diligence needed for each.

Gucci Infringement Case Against Forever 21 Raises Issues About Limits of Trademark Rights

One way of protecting design elements for products is trademark law. Certain signature designs, when associated with a single brand, gain trademark rights, also known as trade dress. But, unlike patents and copyrights, trademark rights have built-in limitations stemming from their purpose: to identify the source of the goods.

Fashion/luxury goods house Gucci is now embroiled in a litigation against Los Angeles based discount retailer Forever 21. Gucci accused Forever 21 of copying its registered trademarks – the Green-Red-Green and Blue-Red-Blue stripe designs (which it calls its “webbing” designs) and incorporating them on cheap knockoff clothing items.

Jumping the gun, Forever 21 filed an action for declaratory judgment of non-infringement and invalidity of the marks; Gucci counterclaimed.

The case well-illustrates that trademark claims, while seemingly simple, often implicate a host of legal issues. Among other things, the Forever 21 court will need to consider:

  • Validity – Does Gucci’s design function as mark? Has it achieved “secondary meaning?” Is there an issue of “functionality?”
  • Infringement – does the public perceive Gucci’s design to be a mark at all? Do point-of-sale circumstances – use of other marks on the Forever 21 website – obviate confusion? Did Forever 21 act in bad faith? Is there “post-sale” confusion?
  • Dilution – Gucci has asserted a “dilution” counterclaim. But federal and California dilution laws have been amended to require a very high level of fame – virtually a household name. Will Gucci be able to prove its stripe designs meet that test?

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.

Knockoffs: Creating an Effective Strategy on a Tight Budget

Part II: Prioritizing Among the Problems

This is the second in our four-part series about developing an effective strategy to deal with knockoffs and counterfeits when faced with a limited budget.  

The first post detailed how to assess the scope of the problem in the marketplace, create a list of sources of knockoffs, and categorize them by type and by harms they cause your company.  In this second post, we consider how to use this categorized list to prioritize dealing with the different knockoffs your company faces.  

Fastener Case Presents Supreme Court with Opportunity to Resolve Long-Standing Trademark Remedies Issue

Obtaining full relief against infringers is an important part of any trademark enforcement effort.  In trademark cases, trademark owners generally seek the defendant’s profits from infringement.  But while it is clear that the Trademark Act provides such a remedy, courts are split about what standards to apply.  A recent Connecticut case, Romag Fasteners Inc. v. Fossil, Inc., presents the Supreme Court with an opportunity to clarify when and under what circumstances profits may be awarded.

Awarding Profits in Trademark Infringement Cases Made Easier by District Court Ruling

Recent case law has made monetary remedies easier to achieve in trademark cases – even absent a finding of willful infringement.  The recent Southern District of New York decision in Nike, Inc. v. Top Brand Co. Ltd., 2005 WL 1654859 (S.D.N.Y. 2005)  has held that the prior Second Circuit rule in trademark cases requiring a showing of willful infringement for an award of an infringer’s profit is no longer good law and has in effect been overturned by Congress. 

According to District Judge Kimba Wood’s decision, the 1999 amendments to the Lanham Act mean that willfulness is no longer a prerequisite to an award of profits.  However, willfulness remains an important equitable factor to be considered.  Procedurally, it remains unclear whether a trademark plaintiff can recover such an award on summary judgment, or whether the issue of willfulness will always necessitate a trial.