Court Upholds, Modifies Louboutin Trademark

Susan Scafidi in Women's Wear Daily, September 05, 2012

Media Source

By Michelle Tay

Both Christian Louboutin SA and Yves Saint Laurent America Inc. are claiming victory in the appellate court’s decision Wednesday to uphold the former’s protection for its red-sole shoes, although it modified it to exclude instances when the upper of the footwear is also red.

Because the court upheld the decision to deny Louboutin a preliminary injunction against the sale of YSL shoes it alleges are infringing its trademark — which paired red uppers and red soles — legal experts observing the case had mixed feelings about the ruling.

Susan Scafidi, director of Fordham University’s Fashion Law institute, said, “Louboutin should be very relieved that the decision didn’t cancel his trademark entirely as the district court had threatened to do.”

William Borchard, partner at intellectual property law firm Cowan Liebowitz & Latman, said, “Louboutin may have lost this particular battle against YSL [over the monochromatic shoes], but he won the war against everyone else. It was unfortunate that they decided to sue YSL on an all-red shoe — that’s what started [them] off down a wrong track. But the color of a sole can’t stand on its own without the shoe. The court reached the right conclusion that the red sole did have secondary meaning.”

The appellate court is, in effect, modifying Louboutin’s red sole trademark. It wrote in its decision that the secondary meaning of the mark held by the designer “extends only to the use of a lacquered red outsole that contrasts with the adjoining portion of the shoe.”

The court added, “We modify the red sole mark … insofar as it is sought to be applied to any shoe bearing the same color ‘upper’ as the outsole. We therefore instruct the Director of the Patent and Trade Office to limit the registration of the red sole mark to only those situations in which the red lacquered outsole contrasts in color with the adjoining ‘upper’ of the shoe. We therefore affirm the denial of the preliminary injunction insofar as Louboutin could not have shown a likelihood of success on the merits in the absence of an infringing use of the red sole mark by YSL.”

Christian Louboutin released a statement saying, “We are extremely pleased and gratified that the Appellate Court found our key arguments to be correct: first that color can and does serve as a trademark in the fashion industry, and that [our] trademark is valid, protectable and enforceable. As we have said throughout these proceedings and we reiterate now, especially in the light of this decision, we will continue to take all steps available to protect our trademark.”

Speaking to FN by phone from Auckland, New Zealand, David Bernstein of Debevoise & Plimpton, who represented YSL in the litigation, said, “This is a total victory for us and we’re thrilled. The issue for today is how happy we are. What’s left are our counter claims against Louboutin.” Those claims include tortious interference with business relations and unfair competition, as YSL alleged Louboutin induced retailers to stop selling the monochromatic red shoes named in the case, causing YSL monetary damage when the goods were returned. In a statement released by YSL, a company spokesman said, “According to YSL, Louboutin has been wrong from the start to suggest that YSL made monochromatic red-soled shoes in order to imitate Louboutin’s design. YSL will continue to make fair use of the color red, along with all the other colors in its designers’ palettes, in the design of its monochromatic shoes.” Louboutin’s lawyer, Harley Lewin of McCarter & English, however, had a different take on the court’s ruling. “It’s a compromised decision,” he said. “We got three quarters of a loaf and YSL got a quarter of a loaf … This is a 32-page decision and the dust hasn’t settled yet.” Regardless, the case is likely to have lasting implications for fashion law, experts said. Intellectual property lawyer David Jacoby of law firm Schiff Hardin said while it remains to be seen whether the legal row was a worthwhile exercise for Louboutin, it did serve to establish the role of color and usage in secondary meaning relating to trademark. “If Louboutin had not been found to have established secondary meaning for the contrasting red outsole, it’s hard to imagine what ever could,” said Jacoby.