SCOTUS Changes Fashion Law Forever

Until now, no case hailing from the niche of fashion law had stepped onto the U.S. Supreme Court stage.  A decision this week has changed that.

The Star Athletica v. Varsity Brand case has become a trailblazer for copyright in the fashion industry. Just yesterday, the SCOTUS found decorative items--specifically those common on cheerleading uniforms--to be protectable under copyright law.  This ruling is contrary to years of cases in lower courts, where opinions have continuously determined decorative elements of clothing were inseparable from the garments themselves.   

In the only apparel-related case to ever come across the docket, the Supreme Court made a determination which could change the fashion industry forever.   Law360 noted, "The question before the justices was how courts should decide when such “separability” exists, an issue that has split lower courts. Fashion companies pushed for a looser approach that would allow them to protect more apparel with copyrights; consumer advocates called for a tighter approach, meaning less protection and more competition."

The fashion companies won. 

With this ruling, designers now have a gateway to protecting the artistic elements of their designs, and drawing a long-awaited distinction between their unique work, and a useful item (clothing).  Surely this case will set the stage for more litigation, as designers will have firm ground to stand on when exercising their vigilance in protecting their work. It may also set the stage for shocking the conscious of the counterfeit market. 

This has been quite the fight for those of us knee-deep in the fashion law industry.  What will fashion law conquer next?

Beverly Hills Fashion Law Symposium 1/12!

Fashion Forward: Wearable Technology, Design Patents, Privacy, and the latest Fashion Law Cases--

It's time again for some fab fashion law symposiums!  Well, it's actually always time, but the next one is fast approaching.  The fashionable folks at the Beverly Hills Bar Association are hosting a wonderful panel discussion this coming Thursday!  Some fashion law faves will be presenting, so we know it's sure to be a good time.  

Check out the details below and register NOW!!

IP, Internet & New Media Sections

Present

Fashion Forward: Wearable Tech, Design Patents, Privacy, and the latest Fashion Law Cases! 

Learn the latest in fashion law innovations: Wearable technology and where it is headed, how to use design patents as protection, privacy issues in the fashion industry (who is monitoring you!), what you need to know about FTC issues regarding sponsored products in fashion blogs, plus the Varsity case which is on deck to be heard by the Supreme Court in 2017!

Speakers:

Victoria Burke, Esq. Director of Business Development, Raw Science TV

Craig Gelfound, Esq. Partner, Head of Arent Fox's Intellectual Property Group (LA office) and Adjunct Professor at Southwestern Law School

Danielle Garno, Esq. Shareholder, Greenberg Traurig LLP-  Fashion Law Practice

Hillary Kane, Esq. Professor of Fashion Law at Southwestern Law School, of Counsel at altView Law Group, and Founder of Raising Kane Consulting

When:Thursday, January 12, 2017, 12:00 pm to 2:00 pm(Program at 12:30pm)

Where: Lawry's the Prime Rib (Directions, Free Underground Parking)

$0 - Members of The Order of Distinguished Attorneys
$45- BHBA Members who pay in advance*

$245 - Non-BHBA Members who pay in advance*  

Interested in Membership?Try it Free, No Commitment, for 30 days

Azita Mirzaian, Esq. & Michael Lovitz, Esq - Section Co-Chairs 

Martin Keleti, Esq. - Vice Chair   |   Victoria Burke, Esq. - Program Chair

* Advanced registration closes 24 hours prior to event time. Registrations received thereafter include a $25 additional fee. Full refund with 48 hours notice. Raincheck with 24 hours notice. 

This activity has been approved for Minimum Continuing Legal Education credit by the State Bar of California in the amount of 1.5 Hours of Participatory Creditand the Beverly Hills Bar Association certifies that this activity conforms to the standards for approved education activities prescribed by the rules and regulations of the State Bar of California governing minimum continuing legal education.

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B.A.F.F.L.E.D. Fashion Law

Same Shirt, Different Name--Zara Sued (Again) for Copying--

Zara was just sued by the socially-conscious brand, Reformation for infringing on their model-moniker-bearing sweatshirt design.  Reformation previously sold a plain grey sweatshirt with model Cindy Crawford's name across the chest.  Zara is now selling a similarly styled shirt--but bearing the model Elle Macpherson's name.  

Zara still has the shirt up for sale on their site, though a cease and desist letter has to be in transit as we speak.  There are clearly some trademark and even publicity rights issues on hand here as well.  Who knows if Elle approved of the shirt.  Reformation actually got permission from Cindy Crawford for the sweatshirt bearing her name.  She posed for promos.

This will be interesting...yet familiar territory for Zara.  They've been sued in the past for copying, namely by Christian Louboutin.  Tom Ford has expressed frustration in being copied by Zara--Dior, Celine, and Kenzo have been aggravated as well.  

Here they go again.

  

B.A.F.F.L.E.D. Fashion Law

Big Brands Keep Fighting Fakes--

Counterfeits are making waves in the fashion industry and it's nothing good.  In recent months, designers have had to step their protection game up in several ways, just to keep the infringers at bay.  As reported earlier this week, Christian Louboutin, Jimmy Choo, Celine and others have sought a slew of design patents to protect their creations.  

The lack of copyright protection in America makes protection a bit of a challenge.  Trade dress, trademark, and patents are heavily depended on, but take some time to secure.  Stella McCartney had to sue Steve Madden for infringement on her "Falabella" bag--a bag already holding 2 design patents for its continuous chain design.  Tory Burch also came up big recently in fighting for her "Isis Cross" trademark. She won $38.9M in a lawsuit against Lin & J to protect her trademark.  Despite claiming victory over YSL, Louboutin is still awaiting trademark validity from the EU.  This stems from their 2013 battle with Van Haren infringing on the red soles.  

While keeping us showered with designs for the new season, designers have to keep an eye on the counterfeit market.  According to NetNames, a London-based brand protection firm, counterfeiting is getting a consistent boost from e-commerce, channeling sales up about 15%.  Much of the items are sourced through China--nearly 70%.  The raw materials are there.  The factories are there. And, the labor is pretty inexpensive.  An NYC couple was was just charged with conspiring to traffic counterfeits after being caught with over 130,000 counterfeit items in their rented warehouse.  Many of the goods were said to have been sourced from China.  It's the largest source, but certainly not the only.   

Counterfeiting is about 2% of world trade--equating to about $1trillion, according to the International Chamber of Commerce.  Make no mistake, many purchasers of counterfeits were never going to purchase the real thing anyways.  But, some were, and got bamboozled.  Whether they were looking for the real thing or just something to pass at a quick glance, the harm done by fakes doesn't change.  There's a cost far greater than the black market price. 

B.A.F.F.L.E.D. Fashion Law

Fast Fashion Has In-Fighting Over Copies--

Retailer H&M is suing its fellow fast fashion colleague, Forever 21 over copyright infringement.  H&M claims Forever 21 is selling a "Beach Please" bag, distinctly made for H&M, which was also registered for a copyright this past June.  The sales have continued even after cease and desist letters.

The story here seems to be a tad bit more about the irony of one fast fashion retailer suing another.  Both are widely known for taking designs straight from the runway to their quick manufacturers, then sales floor within weeks.  Forever 21 is said to have commissioned one of their loyal Chinese manufacturers for the H&M bag copy.  Both retailers have been sued over copies in the past--several times. 

It will be interesting to see how this one plays out.  Forever 21 is known for settling their infringement suits under the table.  Maybe this will be no different.   There are many arguments on both sides for protection of fashion designs expanding past prints and patterns.  Usually, the fight is between a luxury retailer and fast fashion giant...or even a boutique designer and established retailer.  How will 2 common infringers settle it? Nevertheless, there's something more to be hammered out here.  

For more on fashion law and infringement's damage, check out these posts!

B.A.F.F.L.E.D. Fashion Law

Blissful Ignorance: Abercrombie Can’t Pretend They Didn’t Know They Were Discriminating

By Dana Martin

All fashion enthusiasts will agree that the way we dress is an important aspect of our self-expression. For many people, clothing choices go beyond a way to express their personal style and become a part of their religious, cultural, or gender identity. However, in the working world, an employer has the legitimate right to impose a dress code on his or her employees to convey a sense of professionalism or uniformity in that business. What happens when the right of an employer to enforce a dress code conflicts with an employee’s right to dress in accordance with his or her beliefs? The recent Supreme Court decision, EEOC v. Abercrombie and Fitch Stores, Inc., highlights the importance of preserving the rights of the individuals even when they may conflict with dress code policies.

            Title VII requires that any dress code imposed by an employer not be discriminatory towards any one group and be enforced consistently and evenhandedly. This does not necessarily mean that the dress codes may not be discriminatory in effect. For example, the Abercrombie policy in question, banning any “caps” while at work, is not outwardly discriminatory in that it targets one group over another. Rather, no employee, regardless of religious background, was permitted to wear a cap. The effect, however, was discriminatory against women who wore a headscarf for religious reasons. When a policy is not outwardly discriminatory but still has a discriminatory effect, the employer must allow accommodations and exceptions when requested by employees whose beliefs are contrary to the dress code, unless the accommodation would cause “undue hardship” on the employer. An example of an undue hardship would be a safety or health issue caused by the accommodation for which there is no other reasonable alternative. (EEOC v. Grand Central Partnership – sanitation workers with dreadlocks could not be terminated for refusing to cut their dreadlocks for religious purposes so long as they could reasonably be tied up neatly).

            In the Abercrombie case, Samantha Elauf applied for a job at one of the retail stores in Oklahoma. She impressed the assistant manager at the interview, however, was not offered a job because her headscarf conflicted with Abercrombie’s controversial “look policy.” The assistant manager did not ask about Elauf’s religious practices, rather, she assumed she wore the scarf for faith-based reasons and assumed that she would wear it every day. Abercrombie contended at trial that Elauf never requested an accommodation and the manager did not actually know whether or not her headscarf was a religious observance. Therefore – they claim – they did not discriminate by denying her the job since all they knew was that this applicant was violating their look policy. They assert that any suspicions about her religious beliefs were irrelevant without actual knowledge or a request for accommodation. The Court ruled against Abercrombie and held that you cannot deny a prospective employee a job out of fear that they might request an accommodation. Title VII only requires that the adverse employment action be at least motivated in part by religious discrimination. Even though the manager was not positive that Elauf wore a headscarf for religious purposes, she admittedly at least suspected that to be the case and did not hire her because of it. This is sufficient to conclude she was motivated by religious discrimination even without actual knowledge of Elauf’s religion.

            The Court recognized that this ruling may require employers to ask prospective employees about their religious beliefs and whether they would need an accommodation. This could potentially lead to stereotyping and uncomfortable conversations. After all, if Elauf did not wear a headscarf for religious purposes but rather as a personal fashion choice, Abercrombie would have been justified in requiring that she take it off in compliance with their policy or risk being terminated. However, the interest in preventing discrimination before the prospective employee has even had a chance to request an accommodation outweighs this potential for awkward conversations.

          Abercrombie is no stranger to discrimination law suits. In 2004, they settled a case in which they were accused of keeping minority employees in back-room, stocking positions and reserving the sales floor spots for white workers. The result was a $40 million settlement and an agreement on Abercrombie’s part to hire diversity recruiters at the corporate level. Even more similar, in 2011 the company settled a suit in which a Muslim woman was fired for refusing to remove her headscarf. Allowing headscarves was determined to be a reasonable accommodation, and “distracting from the brand” was not considered an “undue hardship” on Abercrombie. Here, Elauf’s case was a great victory in taking protections for an individual’s right to dress according to their religious beliefs in the work place one step further. The effect of this case is that employers will not be able to use “I didn’t really know” as an excuse to cover up discriminatory motives in hiring practices. It is important that the court continue to recognize how important clothing choices can be to one’s sense of self and protects that right in the work place and beyond.

Stay tuned for more on ethical fashion...

B.A.F.F.L.E.D. Fashion Law

Victoria's Secret Loses Its Pink--

In a recent London-based lawsuit, the famous lingerie line lost their ability to use the "Pink" trademark.  Victoria's Secret, an L Brands line, was sued by Thomas Pink, an English brand specializing in dressing men for work and formal events.  While you can find Thomas Pink items in America at various retail stores like Macy's, the brand thought VS's use of "Pink" brought confusion to the market.


A trademark is a symbol used in the market to signal the source, and often quality, of goods.  Popular trademarks are often registered with their respective nation's trademark office, and provide protection to the brand.  Thomas Pink accused Victoria's Secret of infringement based on confusion, claiming the separation of brands may not be distinct enough to shoppers seeking ties and dress shirts--not hoodies and panties.  

The men's line was delighted to find a judge agree the trademarks were too similar for comfort in this global market.  “We are delighted with the outcome of this case, and will continue to protect the considerable investment that has been made into building Thomas Pink into a leading luxury clothing brand,” Jonathan Heilbron, the company’s chief executive officer said.  

This outcome could set the pace for stricter regulation of trademarks.  Brands are taking advantage of both vertical and horizontal integration, so the selection and use of names in a global market largely dependent on internet and social media is increasingly difficult.  Of course Victoria's Secret believes the clear distinction in customer base alleviates any confusion between the 2, but for now, they'll have to figure out some other mark for their varsity line.  Any ideas?

B.A.F.F.L.E.D. Fashion Law

The Battle At Red Sole:  A Win-Win, Ultimately--

Just yesterday, the U.S. Court of Appeals for the 2nd District ruled on the Louboutin v. Yves Saint Laurent (now Saint Laurent Paris) case in regards to the ever popular red soled shoe.

Here is a review of what happened:

• The Appellate Court affirmed in part and reversed in part the ruling of the District Court.
• The Court affirmed the ruling which denied Louboutin a preliminary injunction to stop YSL from selling their monochromatic shoes--covered in red on top and bottom.  
• The Court reversed the finding of Louboutin's trademark to be invalid by the District Court--saying a color can, in fact, serve as a trademark in the fashion industry.

• The Affirmation
• Both the District Court and Appellate Court denied Louboutin an injunction to stop YSL from selling their all red shoes.  The reason being, on the District Court level was largely because a color couldn't be used as a trademark-- so Louboutin couldn't stop YSL from selling their shoe.  On the Appellate level, the injunction denial was affirmed because the trademark approved for Louboutin is one for red soles contrasting the "upper" of the shoe. The YSL shoe did not have a contrasting sole and upper.

• The Reversal

• This helps explain the affirmation a bit.  The Appellate Court reversed the lower court's ruling, finding the Red Sole Mark invalid.  This was reversed because of the "secondary meaning" developed by the Louboutin red sole in the market.  As the Appellate Court noted from precedent: Secondary meaning is acquired when, in the minds of the public, the primary significance of a product feature...is to identify the source of the product rather than the product itself.  Ultimately, consumers have been trained through marketing and promotion to associate red soles contrasting their uppers as high-fashion Louboutin shoes.  With a modified understanding of the mark, Louboutin prevailed. 

• The Steps Ahead
• In a nutshell, both sides can be seen as winners.  Louboutin has protected their contrasting red sole as a valid trademark in the fashion industry.  It is used to identify their brand, as required for trademark registration, but does not limit competition in the market.  YSL can continue marketing their monochromatic shoe.  The red sole trademark is not infringed when used in a way contrary to a red sole contrasting a non-red upper.  
• The Court reminded us about some of the main principles of trademark law, providing:
• By placing the color red in a context that seems unusual and deliberately tying that color to his product, Louboutin has created an identifying mark firmly associated with his brand which, to "those in the know" instantly denotes his shoes' source, Louboutin.
• It is the first principle of trademark law, that an owner may not use the mark as a means of excluding competitors from a market.
• Allowing red soles in all circumstances to be the trademark possession would limit shoe marketing.  Modifying the mark to apply only in a specific manner promotes competition--a primary crux in trademark law.  
• The fashion industry, like other industries, has special concerns in the operation of trademark law.
• Although there is no copyright protection in the fashion industry generally, trademark is essential to the industry and cases like this are major for this creative market.

As promised, we've been watching this one for some time now.  If you've missed out on how we got to this point, check out these Flashbacks to get up to speed:

The Battle At Red Sole: Not So Cut and Dry 

The Battle At Red Sole: Did The Court Get It Right?

For more on what's going on in fashion law...and there's quite a bit, consult the Fashion Law Files!

B.A.F.F.L.E.D. Fashion Law

The Battle at Red-Sole:  Not so Cut and Dry-

The lawsuit between Christian Louboutin and Yves Saint Laurent appeared to be a trademark battle set to end easily.  YSL would be told they could not use red soles on their shoes because Louboutin has a trademark on the color and use by another designer would confuse consumers.  We explained this logic and lesson in trademark not too long ago.

Now it appears things aren't as black and white as they seem.  There's some gray....maybe even red.  Trademarks have a number of provisions to be met for use and protection, and color is no different.  Colors can be trademarked when they serve the function of identifying a brand in the market.  The Tiffany teal-blue boxes fall into this category.  One would think the red bottom does as well, but it is not the story Mr. Louboutin is telling.  He said the shoes have red soles "because red “attracts men to the women who wear my shoes."  True and fine, but uh, did you check with legal on this?  

To protect the trademark, the designer must prove the red bottoms serve as an identifier for their products--which in the market, they do!  Everyone knows and expects red soles from Louboutin.  However, this case must be successfully made in court.  Red soles by any other designer will cause confusion and hurt the Louboutin brand.

We are anxious to see what happens next, and will keep you posted, step after red-soled step.

B.A.F.F.L.E.D. Fashion Law

The Battle at Red Sole: Did The Court Get It Right?

We don't think so.  News hit earlier today about the drama over red-soles.  If you've been paying any attention to the trademark case between Christian Louboutin and Yves Saint Laurent, you know they are battling over the use of the red sole trademark.

Louboutin has a trademark protecting their use of a "bright red outsole" for the footwear they produce.  The Southern District of NY judge denied their motion to keep YSL from using red soles on their shoes while the case pends: “Because in the fashion industry colour serves ornamental and aesthetic functions vital to robust competition, the court finds that Louboutin is unlikely to be able to prove that its red outsole brand is entitled to trademark protection, even if it has gained enough public recognition in the market to have acquired secondary meaning,” said the judge in his ruling.  YSL even alleges Louboutin does not deserve the trademark at all because of the generic nature of red shades to possibly be used in shoe soles.

We have some trouble with this.  As mentioned here before, trademarks are tested based on: Strength, Similarity, and Proximity in the market.  In this case, we see YSL failing to prove Louboutin shouldn't have their trademark, and then so, the injunction.  Here's the breakdown:

Strength:  Louboutin has an extremely strong mark in their "red-bottoms", simply because everyone knows them by the moniker, and expects shoes with red soles to be made by Christian Louboutin. It's known everywhere, in all media outlets-- fashion and non-fashion. The company has made their mark in the shoe and fashion industry, simply by making sure every shoe they produce has a red outsole.  All YSL shoes do not.

Similarity:  Sure the shades of red are vast and vary, but any non-"Louboutin Red" should be immediately suspected as a fake.  You know it when you see it.  The sole YSL claims to have been using since the 70s is, in fact, similar to the Louboutin sole.   However, using the colored sole on a shoe here and there over the years leaves way for a gap in the market, which Louboutin has filled.

Proximity in the marketplace:  Louboutin wins here, too.  YSL shoes and Louboutin shoes are clearly in the same market and can lead to confusion in the exact same customer base.  EVERY Louboutin shoe has a red sole, no matter the style, upper color, or heel height; and the brand is widely known for it.  Finding red soles on other shoes, especially in the luxury market will confuse consumers, and force the ever-vigilant fashionista to watch their purchases and selections.  No shot to YSL; it's a great brand.  You just need your own niche in the market.

So, after this breakdown of trademark testing, we are extremely anxious to see how this case pans out.  We believe Louboutin has met all the criteria it needs to keep its red sole protected, and are actually quite shocked this case is even in court.  

Share your thoughts on this one with us.  We'll be watching it every red step.

Follow us and other fashion law professionals on Twitter for much, much more!