American Eagle Outfitters Inc. won an early round in its legal match with Payless ShoeSource Inc. when a federal judge in Brooklyn granted a preliminary injunction against the footwear retailer.
Judge Edward R. Korman of the Eastern District of New York issued the injunction on July 7, requiring Payless to include a clear disclaimer stating that goods in its American Eagle by Payless line are not affiliated with American Eagle Outfitters.
Pittsburgh-based American Eagle Outfitters alleged trademark infringement and unfair competition in the lawsuit filed in April 2007.
The legal fight between the two firms dates to May 2006, four months after the discount shoe giant acquired the American Eagle footwear brand from Jimlar Corp. The Great Neck, N.Y.-based footwear wholesaler had produced the American Eagle footwear line for sale in department and specialty stores for about 20 years.
Jimlar had entered into an agreement with American Eagle Outfitters to maintain different brand identities and distribution channels, according to court documents.
American Eagle Outfitters alleged that after acquiring the brand, Payless began a sales and marketing campaign trading on the teen apparel retailer's commercial appeal and goodwill.
Payless said Wednesday that it would abide by the ruling in its use of the American Eagle mark.
"Payless ShoeSource alone has the right to use the American Eagle trademark for footwear and select accessories," said Mardi Larson, a spokeswoman for Collective Brands Inc., the Topeka, Kan.-based parent company of Payless, who noted the preexisting agreement between the brands. "The result is that Payless ShoeSource will continue to market its American Eagle products along with the disclaimer where required."