On Thursday afternoon, less than three hours after closing arguments concluded, the eight-person jury came back with a verdict that found the luxury designer was not liable for damages or profits that it made selling product with four stripes or its trademark grosgrain ribbon.
“We are pleased that the jury found that at no time did Thom Browne Inc. infringe on any of Adidas’ trademarks. For over 20 years now, Thom Browne has been a pioneering force in luxury fashion, bringing a wholly unique and distinctive design aesthetic that combines classic tailoring with American sportswear sensibilities. We look forward to continuing to design and provide the creative products that have become the hallmark of the Thom Browne label,” a Thom Browne spokesperson said late Thursday.
Adidas America and Adidas AG had been seeking damages in the amount of $867,225 — the amount the companies agree it would have received in licensing fees from Thom Browne Inc., if the two had worked together — as well as the $7,011,961 million in profits it alleges the American designer made from selling apparel and footwear with stripes. The case was heard by Judge Jed Rakoff in Manhattan’s Southern District Court.
On Thursday, attorneys for Adidas and Thom Browne laid out their final arguments in closing statements in the trademark infringement suit between the two companies. And the jury, which heard testimony in the case from both sides over eight days, was charged with determining whether Thom Browne Inc. was liable for trademark infringement or dilution.
Thom Browne’s attorney, Robert T. Maldonado of Wolf, Greenfield & Sacks P.C., started his closing argument with a simple statement: “Adidas does not own stripes.”
He said Thom Browne, the designer and founder of the eponymous brand who was in the front row in his signature shorts suit and striped socks, cared enough about his company to be in court every day. On Thursday, the entire right side of the courtroom was filled with members of his team, all sporting head-to-toe looks from the collection. “He’s recognized as a game changer and an icon in the fashion industry,” Maldonado said of Browne. “The notion of Thom Browne wanting to trade on the reputation of Adidas offends him. He is not Adidas.”
Since the beginning, Browne has been using stripes, he said, to reference collegiate varsity sweaters and he “never considered Adidas” until he was approached by the company in 2007 after it saw some pieces he designed using three stripes as a design choice. Browne agreed to change his mark to four parallel bars so as not to get into litigation with the large sports company.
Maldonado said that Adidas’ trademarks show that it only owns three bars that it uses horizontally nearly all of the time. It also has a trademark for a quadrilateral bar logo.
He pointed to testimony from several witnesses over the course of the trial that, when asked to provide a specific definition for the three-stripe mark, said it could be anything from one to five or six bars, depending upon the usage. And the “smooshing” together of the bars on a collaboration with Gucci was also defined as three bars, another witness testified. On the New Classics collection launched last year, Adidas used stripes on the left sleeve, which a company executive said was “not where you usually see them,” Maldonado said, adding, “there is a complete lack of clarification.”
He proceeded to show documents from Adidas’ internal branding guidelines that designers can only tilt the stripes 20 degrees and use them vertically, never horizontally. And using white-on-white stripes, such as that used by Thom Browne on his sneakers, also violates the rules, Maldonado said. “How are we supposed to know that three stripes mean with all this inconsistent messaging from Adidas?”
Maldonado wrapped up his statement by saying that the luxury pricing of Thom Browne means that no one would be confused into thinking it was made by Adidas. And harm only occurs when someone buys something they think was made by someone else.
Because the two companies had coexisted for more than a decade since Thom Browne switched to four bars, and because Adidas did not show any evidence of harm, Maldonado asked the jury to award the company nothing in its suit. “To award damages, you have to prove harm, so we are asking for zero.”
In his closing argument, R. Charles Henn Jr. of Kilpatrick Townsend & Stockton LLP, who represents Adidas, reiterated the German sports company’s main points and reminded the jury that every trademark case has three interested parties — in this case, Adidas, Thom Browne and the public. The general public, he said, could be confused by the designer’s use of stripes on products that are in Adidas’ wheelhouse such as compression tights, T-shirts, jackets and other sports-themed apparel, as well as sneakers.
Because Adidas is well-known for the three-stripe mark it has been using in the U.S. since the 1950s, Henn said, consumers may see Thom Browne pieces in stores or on the street and be confused as to the maker. Adidas is not alleging that anyone spending $3,000 on a Thom Browne cashmere sweatpant and hoodie with stripes on the side would believe they were purchasing an Adidas product, he stressed, but if the product wasn’t clearly identified as Thom Browne on social media or when being worn in public, there could be confusion.
Henn said that Adidas’ “multiple” trademark registrations cover the use of three stripes on apparel and footwear in black-and-white or color as well as on the trifoil logo it began using in the 1970s and the “badge of sport” corporate logo it started using in the 1990s.
Over the years, Adidas has used the stripes horizontally, vertically and diagonally in a variety of colors. In addition, the company spends $300 million a year advertising the stripes and products sporting the mark in the U.S. account for $3.1 billion in annual sales, he said.
“It is one of the strongest trademarks in the United States when it comes to apparel and footwear,” Henn said.
Although Thom Browne, which had used three stripes on some pieces since its launch in 2003, switched to four parallel bars in 2008 after Adidas approached the company, Henn said many consumers still confuse the number of stripes when viewed from a distance. In addition, the “negative space” between the primary stripes can create the optical illusion that there are three bars.
He reminded the jury of the consumer survey conducted by Hal Poret that found 26.9 percent of the 2,400 participants believed Adidas was the manufacturer of some Thom Browne sports-related pieces with four parallel stripes.
Henn also pointed to Thom Browne’s move to increase its sportswear business by partnering with sports teams such as the FC Barcelona soccer club and its star athlete at the time, Lionel Messi, who had been an Adidas-sponsored ambassador for 15 years, as well as the Cleveland Cavaliers of the NBA where Adidas has had a long relationship, as evidence of bad faith among the Thom Browne team.
Following the verdict, Adidas out out a statement that said: “We are disappointed with the verdict and will continue to vigilantly enforce our intellectual property, including filing any appropriate appeals.”
Douglas Hand, an attorney with Hand Baldachin & Associates LLP, called the ruling “sound.
“This is a case of there being no confusion in the minds of consumers between the stripes in Thom Browne, the brand, and what Adidas uses. It’s a good thing for brands and the public at large. Stripes are a fundamental component of sportswear and there’s a function to stripes in fashion. It’s like using red or black in fashion. If something gets too associated with one brand, it’s problematic to other brands.”
He pointed to the Christian Louboutin case where he has sued over the use of red on shoes. The court has found that the trademark is for the red sole only, not the color red itself.