A federal district judge in New York Wednesday ordered Liz Claiborne Inc. and its Lucky Brand Dungarees Inc. subsidiary to pay Marcel Fashion Group $300,000 in punitive and compensatory damages, ending a hotly contested five-year trademark infringement dispute.

This story first appeared in the June 3, 2010 issue of WWD. Subscribe Today.

The final judgment and order followed the April jury verdict in favor of Marcel, in which jurors found that Lucky Brand infringed on Marcel’s Get Lucky trademark.

Ann Schofield Baker, head of McKool Smith’s national trademark litigation practice, who led Marcel Fashion’s trial team, called the awarding of punitive damages in a trademark case “highly unusual.”

“This is a complete victory for the little guy,” commented Ezra Mizrachi, president of Marcel Fashion. “Lucky Brand and Liz Claiborne tried to put the Get Lucky apparel line out of business with this lawsuit, but instead, the jury decided that they are the ones who committed trademark infringement.”

But according to Liz Claiborne’s senior vice president and chief legal officer, Nicholas Rubino, it was Liz that was “vindicated by the jury,” in part because the jury rewarded only $20,000 in compensatory damages, “not the nearly $30 million Marcel sought.”

“The jury found Liz Claiborne did not act in bad faith,” Rubino said, explaining that the $280,000 in punitive damages reflect his company’s failure to comply with a 2003 agreement with Marcel, something that wasn’t under dispute during the trial.

“Quite simply, Marcel and its counsel rolled the dice with their unsupported damages claim in hope of a big payday, but in the end they did not ‘get lucky’ with this savvy jury,” he said.

The apparel vendors had been trading legal jabs since 2005 when Liz and Lucky accused Marcel and its licensee, Ally Apparel Resources, of trademark infringement of their Get Lucky line. The firms reached a settlement in 2003, but soon after, Marcel filed counterclaims against Liz and Lucky when it learned of several instances where the firms allegedly had breached the agreement.

In April, a jury cleared Marcel of any trademark infringement because the apparel firm had used Get Lucky since 1985, years before Lucky Brand was formed. The court also barred Liz and Lucky from using Get Lucky in connection with men’s and women’s apparel, fragrances and accessories, citing that use of the trademark violated federal unfair competition laws.

The parties have waived the right to an appeal.

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