With the increasing speed of fashion’s musical chairs, employment law and contract concerns are taking center stage in the industry. In terms of intellectual property, Cartier and Forever 21 are looking to courts for declarations, amidst claims that they are not running afoul of trademark law. Meanwhile, Adidas has escalated its bitter fight with Forever 21, filing a new trademark infringement suit against the fast-fashion giant.
Employment Squabbles Outshine IP
In the midst of the recent employment contract battles between Hedi Slimane and Yves Saint Laurent, and Carolina Herrera, Oscar de la Renta, and Laura Kim, Tamara Mellon was fighting her former brand Jimmy Choo. Mellon, who cofounded the footwear label with Choo in 1996, left in 2011, ultimately launching her own footwear brand in 2013.
Mellon filed a $4 million contract suit against the Jimmy Choo brand several years later after allegedly being unable to secure production from suppliers, thanks to pressure from Choo. According to a statement from her counsel at the time, “Jimmy Choo has engaged in a course of conduct aimed at impairing [Tamara Mellon and Tamara Mellon Brand LLC’s] business by restricting their ability to source production capacity from key suppliers to manufacture luxury leather products, including shoes, bags and accessories.” Her suit further alleged that the boycott caused Tamara Mellon Brand LLC to file for bankruptcy in December 2015, costing her millions of dollars.
A New York state judge this month sided with Choo and tossed out Mellon’s suit, holding that the brand’s cofounder failed to make her case for breach of contract. The court also noted some fundamental flaws in the allegations set forth in Mellon’s complaint.
While intellectual property infringement matters often take center stage in fashion court, employment-related battles have been increasingly coming to light, especially given the growing frequency with which creative and design directors, and even luxury brand executives, are jumping to rival brands.
Watch Out, Cartier!
Despite increased attention to employment-related matters, infringement-related suits are still all over the dockets. Cartier — which landed a landmark victory in the U.K. last summer after the U.K. Court of Appeal held that trademark holders may be granted site-blocking injunctions against Internet service providers — has attempted to preempt a trademark infringement suit from being filed against it. The French jewelry company has asked the U.S. District Court for the Eastern District of Virginia to declare that its “Drive de Cartier” trademark does not infringe Swiss based-brand Driva Geneve’s “Driva” trademark, which covers jewelry, includes watches.
According to Cartier’s suit, Driva has threatened to file a trademark lawsuit against it in connection with the “Drive de Cartier” mark and as a result, “Cartier has been put in the untenable position of not knowing if or when defendant may sue or take other action against Cartier.”
Declaratory judgment actions haven’t proven a useful tool, particularly for parties in a trademark context that are seeking to put a stop to simmering disputes. While declaratory judgment rulings from a court do not, on their own, carry with them any order for action by a party, or imply damages or an injunction, they do entail a binding declaration. In a trademark context, that means whether a party’s rights have been infringed.
Adidas v. Forever 21, Forever 21 v. Adidas
A similar action was filed — and recently dismissed (voluntarily) — by Forever 21 in response to a March 2017 cease-and-desist letter it received from Adidas over its use of stripes on garments. The ongoing saga between Adidas v. Forever 21 dates back to an infringement suit that the German brand filed against Forever 21 in 2015 — and the parties settled out of court.
The battle took a new turn recently when the Los Angeles-based fast-fashion brand asked a federal court in California to rule on whether its use of stripes was infringing Adidas’ famous three-stripe trademark. In its suit, Forever 21 painted Adidas as an overaggressive trademark bully that has been threatening litigation against it for years. Just days after Forever 21 filed its declaratory judgment lawsuit last month, Adidas filed a trademark infringement lawsuit against the retailer in a federal court in Portland, Ore.
Interestingly, Adidas’ complaint was filed under seal, meaning that its contents are shielded from the view of the public to protect confidential information — likely stemming from the settlement the parties reached in connection with the 2016 trademark infringement case that Adidas filed. It is clear that this suit is also, in fact, a trademark infringement matter, and it almost certainly centers on the garments it cited in the March 2017 cease-and-desist letter that promoted Forever 21’s declaratory judgment suit in the first place.
In response to Adidas’ suit, Forever 21 moved to voluntarily dismiss its separate action. According to court documents, it will pursue that claim in tandem with Adidas’ newly filed lawsuit.
Julie Zerbo is the founder of The Fashion Law.