As the FTC reiterates its disclosure rules, will this season’s cruise collection coverage look any different? Meanwhile, Louis Vuitton has been denied its chance to argue its case against parody-maker My Other Bag in front of America’s highest court, and Chanel is the latest high fashion brand to walk the fine line between policing unauthorized trademark uses and being scorned by the media for bullying.
Chanel has revealed that it will reprise its “The Modernity of Antiquity” cruise collection in Chengdu, China, next month. The show will be the latest in a string of shows in far-flung locations that the Paris-based brand has staged over the years, from ho-downs in Texas to over-the-top outings in Havana, Seoul, Dubai and Singapore. While one can always count on Chanel to do it up for its pre-season forays, one thing might be different this season: Publications’ disclosure of the nature of their reviews and related coverage.
The Federal Trade Commission has long held that material connects between parties must be disclosed. Much of the fashion industry has long flouted the rule, opting to not shed light on the fact that brands tend to fly and put up editors in luxurious hotels so that they can take in — and review or provide other coverage — of the pre-season collections.
Whether it be reviews of the collections themselves by some of the industry’s most-esteemed publications, or Instagram coverage by heavily followed editors, such coverage has almost uniformly been devoid of any of the legally mandated disclosures. (Note: WWD, the New York Times, WSJ and The Washington Post have a long history of footing their own travel bills.)
This time around things might be different, as the FTC recently reiterated its disclosure rules as part of its larger push to focus its efforts on the fashion industry and its most influential individuals, in particular. In a recently released document entitled “The FTC’s Endorsement Guides: What People are Asking,” the agency specifically spoke to the industry’s paid-for-travel practice.
One of the questions included in the government agency’s report: “I’m a blogger, and XYZ Resort Company is flying me to one of its destinations and putting me up for a few nights. If I write an article sharing my thoughts about the resort destination, how should I disclose the free travel?”
The FTC answered as follows: “Your disclosure could be just, ‘XYZ Resort paid for my trip’ or ‘Thanks to XYZ Resort for the free trip.’ It would also be accurate to describe your blog as ‘sponsored by XYZ Resort.’”
While this question — and the FTC’s response — is seemingly only directed at influencers, who certainly must disclose paid-for-travel, it almost certainly extends to editors and publications as well.
Three Strikes and LV’s Out
Following a multiyear-long legal battle, Louis Vuitton has been shut down by the Supreme Court. This summer, the Paris-based design house formally asked America’s highest court to hear the case it filed in 2014 against Los Angeles-based bag maker, My Other Bag.
Louis Vuitton argued that by slapping cartoon versions of its logo-covered bags on inexpensive canvas bags, MOB was not only infringing its federally registered trademarks and copyrights but was also diluting the “distinctive quality” of its world-famous trademarks. MOB argued that it should be shielded from liability because its bags amount to parodies and thus are protected by the First Amendment.
The world’s most valuable luxury brand vehemently disagreed, arguing in its petition to the Supreme Court that MOB is not commenting on or making a statement about the Louis Vuitton brand but instead is “capitaliz[ing] on the distinctiveness and positive public perception of Louis Vuitton’s marks by marketing otherwise-ordinary canvas bags bearing its famous marks on one side and the words ‘My Other Bag…’ on the other.”
Louis Vuitton, which showed its spring 2018 collection is Paris this week, further argued that MOB has built “an entire business model premised on the exploitation of famous marks to sell knock-off products,” which is, according to Vuitton, “flatly at odds with Congress’ intent to protect famous marks from [trademark] dilution.”
In particular, Vuitton alleged that the case was ripe for Supreme Court attention as the lower courts — the U.S. District Court for the Southern District of New York and the Second Circuit Court of Appeals — applied law regarding to the requirements for an allegedly trademark diluting use to amount to parody that is at odds with the law in other circuits, such as the Fourth Circuit.
But in refusing to grant certiorari (a commonplace occurrence, as the Supreme Court only agrees to hear a small percentage of cases each term), the justices denied Vuitton another day in court, and with that, has arguably made it quite a bit easier for anyone hoping to claim parody, for better — or likely worse — if you ask luxury brands.
Chanel v. Shanel
In what some might deem something of a silly lawsuit, Chanel has taken on a Michigan-based retailer named Shanel, arguing that the latter’s use of the phonetically identical name not only serves to diminish the esteem of Chanel’s world-famous trademark but also might confuse consumers. Add to this pending matter the lawsuit that the Paris-based design house filed — and won — against Merrillville, Ind., salon owner Chanel Jones, who was using her first name in connection with her business, and one potentially has several newsworthy lawsuits.
Chanel is not alone in filing suits against what many a layman has deemed to be seemingly harmless third parties, though. Rolex made headlines a few years ago for filing not one but two lawsuits against a similarly named deli. That is right, the Swiss watchmaker filed a trademark infringement lawsuit against the owner of Brooklyn, N.Y.-based Rolex Deli for using its name, claiming that the sandwich shop would confuse customers, who might believe that the watchmaker was somehow connected to or had endorsed the deli.
The parties managed to settle the case out of court prior to trial but Rolex was prompted to file a second lawsuit a few later in 2013, because it was not satisfied with the name change to “Roll-x Deli.” The parties again settled the matter out of court and have not been back since.
One of the difficult elements here for brands is the effort to balance their efforts to police unauthorized uses of their famous and uber-valuable trademarks, which is the duty of the trademark holder, after all, with the chance that such lawsuits will spawn a bunch of bad press, which tends to follow when lawsuits are filed, particularly when the parties are, on their faces, unevenly situated (think: big bad guy vs. poor little guy) and the writers are unfamiliar with trademark holders’ duties to police their marks in order to avoid infringement and/or dilution.
Julie Zerbo is the founder of The Fashion Law.