A tale of red soles

Much has been said and written about Christian Louboutin’s iconic red sole brand. It has sparked endless debates about trademark law in various courts around the world, including in the U.S., France, Switzerland, and most recently at the EU Court of Justice.

Christian Louboutin began selling his high-heeled red-soled women’s shoes in the early nineties. The red soles gradually became a signature brand, somewhat comparable to the famous Burberry check pattern. The creator’s idea starts as a mere decorative design, just like any fashion design. But over the years, it gradually becomes a brand in itself because the public begins to perceive it as a source identifier even without any concurrent word mark on the product. Burberry registered its design as a two-dimensional trademark around the world; it recently sued Target in the U.S. for selling scarves with a similar design. As has been the practice of Burberry over the years, that is a trademark claim, not a copyright claim—which would present greater challenges to Burberry under U.S. law.

Back to Louboutin’s red soles: The United States Court of Appeals for the Second Circuit ruled in 2012 that Louboutin owns a valid trademark for his red sole shoe design. Louboutin had taken Yves Saint Laurent to court for trademark infringement. The red sole trademark was deemed inherently distinctive, Louboutin having given ample evidence that the trademark had acquired secondary meaning. Those words sound like music for the fashion brand owner and its lawyers because it means that the court rewards years of investments in sales, advertising and free publicity. (As the court duly noted, Louboutin shoes are popular items to wear when walking red carpet events in the entertainment industry.) Louboutin’s victory was unfortunately limited to the court having confirmed the validity of the trademark; the court also ruled that the same trademark registration could not be invoked against shoes – such as those sold by YSL – that are monochrome red, covering the insole, outsole, heel and upper part.

The U.S. thereby paved the way for Louboutin, which is, after all, a French brand. A long-awaited judgment in the European Union was recently rendered by the EU Court of Justice. This time, it was the Dutch discounter Van Haren that was selling red-soled women’s shoes. The court held, after a long debate, that a red sole applied on the sole of a shoe can be a valid trademark in the EU. Under pre-2018 EU law, the shape of an object that “gives substantial value” to the product itself could not be registered as a trademark. (An example would be the distinctive shape of the Perrier bottle.) The court that the color red, as applied to a shoe, was not as a “shape,” as Van Haren had asserted; after all, Louboutin had not sought to register a shoe but merely a color applied at a certain location on shoes. Following the EU court’s guidance, the District Court in the Netherlands that had referred the issue will now ban the sale of Van Haren’s shoes throughout the European Union.

The Louboutin trademark registration

A crucial takeaway from this case is the reward given for the smart way in which the trademark had been registered. In many trademark systems, the registrant is allowed to specify its two- or three-dimensional object with a brief description. Louboutin’s lawyers had wisely specified the filing as follows: “The mark consists of the color red (Pantone 18‑1663TP) applied to the sole of a shoe as shown (the contour of the shoe is not part of the trade mark but is intended to show the positioning of the mark).”

That victory may not last very long, however. EU trademark law was recently amended, with the effect that not only “shapes” but also “other characteristics” giving substantial value to the product may be barred from trademark registration. This change in the law opens a new can of worms: in particular, it remains to be seen whether pre-2018 trademarks, such as the one owned by Louboutin, can be invalidated on the basis of the new law.

Credit:  Diederik Stols | Guest Post

Phillips Nizer would like to thank Diederik Stols for the contribution of this post to the Fashion Industry Law Blog.  Diederik is a partner at the law firm BOEKX Advocaten in The Netherlands where he specializes in intellectual property, media and entertainment and e-business. (http://www.boekx.nl/en/)


How to Lose a Trademark

When one speaks about trademarks, the familiar adage “use it or lose it” comes to mind. But there is another important principal that can equally endanger your trademark rights: You must police the market, monitor the trademark register and take action to stop infringements, or you may find yourself without a trademark to enforce. Two recent cases demonstrate the importance of this latter principle.

LUSH is the trademark for a global brand of “hand made” cosmetic, fragrance and bath products sold by Cosmetic Warriors Limited (“CWL”), a company founded in England in the mid-1990’s. CWL opened its first Canadian retail store in 1996 and expanded to the United States in 2002. It now operates in excess of 940 stores in 49 countries, including 250 stores in North America, 200 of which are located in the United States. In 2002, it registered the LUSH trademark for use on t-shirts in Canada, but never filed a US registration for apparel. Pinkette Clothing Co. is a California company that, since 2003, has sold women’s clothing under the LUSH mark to retailers in the US and Canada, principally Nordstrom. Pinkette secured a US registration for the LUSH trademark for apparel in 2010. CWL did not oppose the issuance of registration for the mark, although its outside counsel apparently was notified through a trademark watch service of the application’s publication for opposition. In December 2014, CWL applied to register the trademark LUSH in the United States for clothing. When its application was rejected due to Pinkette’s pre-existing registration, it filed an application to cancel Pinkette’s mark. Instead of defending in the cancellation proceeding before the Trademark Trial and Appeal Board, Pinkette commenced a court action seeking a declaration that it did not infringe CWL’s trademark or, alternatively, that CWL’s failure to oppose Pinkette’s application in 2010 and its subsequent delay in seeking to cancel Pinkette’s registration barred CWL from enforcing its trademark rights against Pinkette. CWL counterclaimed for trademark infringement and to cancel Pinkette’s LUSH trademark registration. After trial, a jury found that Pinkette had infringed CWL’s LUSH trademark and that Pinkette’s registration should be canceled, but it also found that CWL had unreasonably delayed in asserting its claims. The court held that the delay barred CWL’s action and dismissed its claims. On appeal by CWL from the dismissal of its claims, the U.S. Court of Appeals for the Ninth Circuit held that CWL should have known of Pinkette’s usage as early as 2010, when Pinkette’s application for registration was published for opposition, that CWL had not been diligent in asserting its rights, and that Pinkette had been harmed by the delay because, in the interim, it had expended time and resources to develop its LUSH business. As a matter of equity, therefore, CWL would not be permitted to assert its claim either for trademark infringement or for cancellation of the Pinkette mark.

The second case demonstrates what can happen when many uses of a trademark for competitive goods are tolerated by the trademark owner for an extended period. The essential function of a trademark is to identify the source of the goods to which it is applied. Trade dress in the form of the design of a product or its packaging can also serve to identify a source and can serve as a trademark when it does. But if the design does not have a source-identifying function, referred to as “secondary meaning,” the design is not registrable for trade dress protection. When other third parties are permitted to use the design in the market for similar goods, the design cannot achieve the required secondary meaning.

Converse learned that lesson the hard way. In 2013, Converse registered a trademark for the “midsole” design of its Chuck Taylor All Star sneakers, consisting of the toe cap, textured toe bumper and two thin stripes along the side of the sole of the shoe. It claimed common-law trademark rights in the design based upon decades of its use prior to securing its registration. It subsequently filed a complaint with the International Trade Commission against Walmart, Skechers, Highline and New Balance seeking to bar the importation of sneakers it claimed infringed its registered midsole trademark and its common law trademark rights in the design. The International Trade Commission found that there was a likelihood of confusion between the Converse sneakers and the competitors’ sneakers. But the Commission also found that there had been a proliferation of competitors using the same design, on the same goods, sold to the same class of consumers over many years. As a result, the Commission concluded that the design could not be said to identify Converse as the source of the goods and, therefore, its trademark registration was invalid.

The lesson of these cases is clear. Adopting and registering a trademark is only the beginning of your work. To preserve and protect the trademark, you must police the market and assert your rights on a timely basis when you discover infringement by others. If you fail to do so, you may find that your investment in the trademark has been lost.

Credit:  Helene M. Freeman


Brooks Brothers at 200 – Part 3: Lessons

Earlier in this series of posts (here and here), I reported on my interview with Arthur Wayne, the vice president, global public relations of Brooks Brothers. We discussed how the brand maintains continuity throughout hundreds of points of sale (wholesale and retail). In business and legal terms, here is the short and simple version:

  1. Stylistic consistency creates trademark consistency. Brooks Brothers maintains uniformity of cut, pattern, SKUs and style names worldwide. I own suits and jackets in the 1818 line, which is the company’s standard, positioned between its premium Gold Fleece line and Red Fleece bridge line. My pieces are of Italian fabric, sewn, variously, in Italy, Thailand and the company-owned workrooms in Haverhill, Massachusetts. All bear the trademark 1818, all are in the slimmest of the company’s fits, which is branded Milano. As a customer, I know that, wherever I find Brooks Brothers in the world, I can put on an 1818 Milano jacket made in any of three continents and know it will fit just as do the ones in my suitcase. In legal terms: The more consistent the message, generally speaking, and the more clearly a trademark represents just one source of origin, the stronger will be that trademark.
  2. Control the message, but respect regional differences. Japanese customers much prefer the company’s products made in its US factories—which they view as a mark of authenticity. French customers, in contrast, want to experience the brand, but they care relatively little where items they buy are sourced. (Interestingly, offered Mr. Wayne in an aside, when foreign buyers visit, it is the Japanese men who typically have the best interpretation of “American traditional style.”) United States trademark law does not permit the registration of geographically descriptive marks, so from a legal point of view, where it is made is of no matter: if customers get that the brand is about the American experience (reinterpreted and, to my taste, noticeably improved, by Italian ownership), that is what matters most.
  3. As in the movies, story is everything to a brand. Marketers and lawyers do not always see eye-to-eye. Every business day, in multiple places around the world, marketing teams are presenting to their lawyers exciting new trademarks, only to hear the lawyers say that they are unavailable for use. On the importance of story for a fashion or luxury brand, however, there should be no disagreement. Just as the mere mention of Veuve Cliquot brings to mind the story of the taste and luxury of Champagne and the mention of Leica brings to mind the story of precise German optics, so does a reference to Brooks Brothers open a page on a story about the American experience—in style of dress and in style of living. When Ralph Waldo Emerson said, “A foolish consistency is the hobgoblin of little minds,” he omitted any reference to wise consistency. That is the path taken by Brooks Brothers and by other international brands that know that, from consistency comes the strength to endure and prosper in multiple territories, among multiple customer bases.
  4. Newness is the best tradition. “People think of us as a traditional brand,” said Mr. Wayne, “but our founder, Henry Sands Brooks, was a fashion guy—a dandy. Look at what followed: collars with buttons; readymade suits; pink shirts on men. All of these things were innovative in their time—probably even shocking to many.” Tradition, in other words, is what happens when innovation meets inheritable acceptance. And that is the best way a marketer, together with his or her lawyer, can build, expand and ultimately preserve a fashion brand.

Credit:  Alan Behr

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Video: Brooks Brothers | Made in America: Makers and Merchants


Brooks Brothers at 200 – Part 2: Method

In my last post, I offered some of the history of the Brooks Brothers brand provided to me by Arthur Wayne, Vice President, Global Public Relations, during a recent visit with him at the company’s headquarters in New York. Having been to Brooks Brothers stores from Milan to London and beyond, I asked if the styles, brand names and trademarks appurtenant to them were used consistently throughout the world.

“When Claudio Del Vecchio bought the company, in 2001,” explained Mr. Wayne about its Italian owner, “he already ‘got’ the brand. The first thing he did was undertake a comprehensive product review. Under its prior owners, the company wasn’t really looking in its own garden—for quality of construction, tailoring—the core elements of the brand.” Mr. Wayne noted that, in the mid-to late 90s, there was much talk that casual Friday would be the death of tailored clothing, and the result at Brooks Brothers was that too many items were inexpensively made—something that is possible to accomplish credibly with fast fashion but is not possible to do stylishly with most tailored clothing.

“Claudio approached the brand as a customer,” continued Mr. Wayne. “His thinking has always been, ‘If I feel this way about what I am seeing, others must, too.’ He brought back quality tailoring and made sure the stores have a consistent Brooks Brothers look. The review was a long process and not everything was changed, but the initiative made us ready for the next challenge: brands are now in their customers’ hands.”

That was elegantly put and it shows the current problem faced by all brands and their lawyers: a brand in its legal form is its portfolio of trademarks, along with other intellectual property rights. And a trademark is above all an identifier of source of origin. If you see the trademark COCA-COLA on a soda bottle, that means it comes from Coke, not Pepsi—and so on. If someone else uses your mark, you take legal action to prevent that or risk potentially losing control of the mark and its registrations.

But how do you accomplish that in the age of social media, when consumers get to rate a brand’s offerings down to individual products—and when the brand feels obligated to post negative consumer reviews of those products on the very website where it is trying to sell them—and when it must deal as well with influencers, who can influence whosoever they please, on their own terms? Those forces can alter the perception of where a brand stands, rather as the gravity of the sun bends the approaching light of a distant star, changing the perception of the position of that star. Brooks Brothers partners with influencers, and it features two of them—one American and the other Polish—in its anniversary edition of its house lifestyle magazine. It is all about what Mr. Wayne calls, “the importance of creating a dialogue with your customers. This is what matters to them.”

What is a fashion lawyer to do with all these new forces and new demands? In the third and final post in this series, we will consider some contemporary lessons for international branding.

Credit:  Alan Behr


Brooks Brothers at 200 – Part 1: Background

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At a time when the fashion press engages in a group hug with brands over how labels can stay viable in the digital age, it is fitting that we should pause to consider a brand that has been doing just fine, thank you, since James Monroe was president of the United States. Brooks Brothers, which celebrates its 200th anniversary this year, has had different owners and various designers (with Zac Posen now directing womenswear), but has adhered to a consistent philosophy that can be described in abstract terms as “wearable and confident American style.” Brooks Brothers can also be described, more explicitly, as one of the few places where, no matter what you buy, if the color and fit work, you can forget the term “fashion victim.” To celebrate its anniversary, the brand mounted its first show at Pitti Uomo in January. Sixty-one models (including eight women who made the term American style into a synonym for chic) were presented to the accompaniment of a full symphony orchestra; unusual for almost any show anywhere, every piece could have been worn out the door of the Palazzo Vecchio onto the streets of Florence (or New York, London or Tokyo).

As a branding lawyer, constancy in branding message and in legal protection are always on my mind. Managing that from the flagship at the corner of Madison Avenue and E. 44th Street in Manhattan may have been easy enough back when, if someone said he was going to Brooks Brothers, you just assumed that he meant going to that corner and into that store. Keeping consistency in message and legal protection became a bit more complicated when the brand expanded across the USA (eleven stores by the 1970s) and then, in 1979, to its first international location, in the prosperous Aoyama neighborhood of Tokyo. The challenges are global now, with the brand maintaining hundreds of stores in nearly fifty countries, and with a wholesale business that places Brooks Brothers products onto shelves and racks of many third-party retailers.

I sat down recently with Arthur Wayne, the vice president of global public relations at Brooks Brothers, in his office in the tower behind the company flagship, to gain some understanding on how it is done.

The first thing that became clear in speaking to Mr. Wayne is that Brooks Brothers adheres to the strategy (which I fully support in general and for fashion in particular) that a brand is its story made temporal. The Brooks Brothers story is the American experience. There are many examples, but consider just three outlined briefly by Mr. Wayne: when miners landed in New York from around the world and headed (one might say herded) west in 1849 during the gold rush, Brooks Brothers innovated, with the ready-made suit. No need to wait to be measured and return for fittings. Pick one off the table,* let it out or take it in, and off you went to California, well-dressed, with a pickaxe in hand. Then came the Oxford button-down shirt, which has been copied by nearly everyone trying to look American.** And I have gone into detail on these pages about why the stripes of American ties, led by Brooks Brothers, go from right to left instead of left to right, as do the British regimental ties of their inspiration.

In my next post, I will pick up with what brought the company to where it is now—and what it is doing to keep its brand on message.

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* Until comparatively recently in the company’s long history, men’s jackets were neatly folded and presented in stacks on counters.

** American style is about looking effortless; that does not mean it is easy to do. I shared with Mr. Wayne how I once knew the American representative of a renowned British shirtmaker. As he explained it to me, after several failed attempts on Jermyn Street to get that American collar right, he walked over to Madison & 44th, bought two Brooks Brothers button-down shirts off the shelf and sent them back to England with the message to please just copy this.

Credit:  Alan Behr


What’s In A Letter?

Recently, the New Balance footwear company won a landmark $1.5 million trademark decision in the Suzhou Intermediate People’s Court, near Shanghai, China. Daniel McKinnon, the New Balance senior counsel for intellectual property, told the New York Times: “If the China marketplace can be thought of as a schoolyard, New Balance wants to make it abundantly clear we are the wrong kid to pick on.”

The schoolyard brawl all started when New Balance alleged that three Chinese brands infringed upon its well-known New Balance “N” trademark. The three Chinese shoemakers, New Boom, New Barlun, and New Bunren, saw fit not only to use similar brand names, but also to trade off of New Balance’s international acclaim by mimicking its slanted “N” design on their shoes. A Suzhou Court cited the defendants’ free-riding, consumer confusion, and market harm as the basis for its ruling in favor of New Balance.

What makes this case important is not only that New Balance was prepared to fight for its rights in China—often a challenging thing to do—but also that it was willing to do so over a single-letter trademark.

A trademark is a source indicator that can convey a range of messages about your brand such as quality, price, taste and reputation—the sometimes obvious and sometimes mysterious factors that, in total, are the goodwill of the brand.
Brand owners often reflect upon the value and protectability of words, names, logotypes, slogans and even colors as trademarks. The victory by New Balance in a famously tough territory tells us that a lot can ride on who is found to own and have the rights to exploit a single letter.

Minimalism is as much a factor in trademark recognition as anywhere else in the broad field of visual expression. Mercedes Benz has made a simple three-pointed star one of the most recognizable marks on earth. In the USA, Louboutin owns the color red for the soles of shoes, and Federal Express owns the truncated version of its mark popularized by the public: FedEx. Take it down even further, and you get marks with one or two letters: PayPal is recognized by two cerulean stylized “P’s” and Facebook by a solitary but consequential byzantine blue lower-case “f”. Uber upgraded its former “U” mark to a modernized “U” enclosed by emerald green.

In fashion, designers have been using single-letter marks for decades. Hermès uses its elegant “H”; and of course, New Balance is using its slanted “N”. A few logos have doubled letters: Gucci has made the twin “G” into a brand; as with the seemingly reflective Tory Burch “T”, the mirrored Fendi “F”, and the interlocking “Cs” of Chanel.

Single-letter marks can be significant in fashion because a single letter can serve not only as a logo, but also as a design that can be emblazoned on clothing, handbags, shoes, etc. Meanwhile, the boom in online retail—where a mark may be only barely visible—has been the basis for the further simplification of marks. The large British online retailer Asos recently abbreviated its trademark to the letter “a,” the better to identify the brand on its mobile app.

 

Credit: Candace R. Arrington

Candace Arrington provides research support as a law clerk to our corporate and business law, intellectual property law and entertainment law practices.