Going into Mercedes-Benz Fashion Week this year, sales of high fashion designs both in New York and around the globe are seeing continued growth. The industry has shown double-digit growth over the last three years and a 36% increase in sales since 1995, according to Bain & Company. Luxury retail sector revenues are expected to grow 50 per cent faster than global GDP, growing to €250bn in sales by 2015.
According to Jacques Beaumont, Intellectual Property Attorney at DDG Paris, “Luxury is a booming business in France thanks to exports.” In 2012, for example, French luxury goods company LVMH reported its strongest sales in the United States, with fourth-quarter sales rising 21%. But this boom in business highlights the importance of worldwide protection, according to Beaumont. Trademark professionals in the fashion industry need to think globally. A French designer, for example, could be discovered by a designer in another country who might easily copy his or her designs.
Barbara Kolsun, Executive Vice President and General Counsel for Stuart Weitzman, LLC as well as an author of Fashion Law: A Guide for Designers, Fashion Executives, and Attorneys, agrees that “the industry is definitely international . . . including manufactured distribution and retail sales. There are very few companies that aren’t global.”
Global protection is particularly important as “lawsuits have focused on large numbers of defendants engaged in trademark counterfeiting and cybersquatting while misappropriating designer trademarks in numerous domain names to sell large quantities of counterfeit designer merchandise,” says Joseph M. Forgione, the Director of Trademark Enforcement at the Gioconda Law Group PLLC and Adjunct Professor of Law at New York Law School in his full interview where he talks about current trends, shares advice, and lists his recommended fashion law blogs.
Fashion Trademark Limitations
In the world of fashion, how do brands protect themselves across international boundaries? According to Kolsun, “a mark might be registrable in the U.S. but not necessarily in another country, which is why it’s important to work with attorneys in other countries where your brand may expand.” On the flip side, “the U.S. is limited to copyright, trademark, and design patents, which is unlike Europe which protects a lot more.” With the relative limitations in the U.S., designers are often surprised at how little they can protect in the country — although something they may not be able to protect in the U.S. could be registrable in another country where they may want to do business.
From his perspective, Beaumont says that “shape and appearances are often difficult to get approved as trademark,” which is particularly relevant to the fashion industry. The primary validation for trademark protection by European law is if the design has substantial value to the product. Since it may take more than a year for a designer to decide what kind of catwalk or models they want to use for an upcoming Fashion Week, one strategy is to file simplified applications for many possible designs, giving the client time to decide which model to use.
Beaumont observes that fashion companies are beginning to pay greater attention to design trademarks. As more companies and trademark attorneys file more applications to get maximum protection for their pictures and shapes, the trademarks submitted can also predict the future of design, such as its appearance on handbags and jewels.
Kolsun recommends that designers should ensure that the names they intend to use for their brands have been fully searched, and also to be aware that if they use their personal name that it would belong to the brand and no longer to the person, citing examples like Calvin Klein, Kate Spade, and Joseph Abboud. “The name should be distinctive, and this is another reason it’s important to use IP counsel. You want it to be able to be protected.”
One of the strongest appeals of luxury brands is the exclusivity and status that comes from owning a designer handbag or pair of shoes that is instantly recognizable (say, a red sole or a purse with interlocking “C”s). When competing designs or trademark infringements threaten profits, imitation is rarely considered a form of flattery.
Let’s consider a designer who is no stranger to counterfeit lawsuits — Tory Burch. Last spring, Burch filed a trademark infringement suit against Bluebell Accessories Inc. for copying her ‘TT’ logo in a piece of jewelry. Her company’s website has a dedicated page explaining how to spot counterfeit goods. While designers clearly have the right to protect their work, inspiration for the clothes currently on the market often stem from a collection recently shown on the Fashion Week runways. Take the iconic “Reva” shoe designed by Tory Burch, pictured below.
While the Reva retails for just over $200, Aldo’s version costs only $70. To a consumer, the shoes may contain similar design elements but the medallions are clearly different. Does Tory Burch own the rights to the design on the shoe medallion or the whole concept of a gold medallion placed on the toe of a black ballet flat? Considering that Christian Louboutin’s trademark protects the red sole but not the use of monochromatic red, what are the differences between a distinct design element and the general use of color and shape in fashion? Kolsun notes that “when it comes to color or design, it has to be a source identifier” — meaning that consumers recognize the design treatment as being key to the brand.
For luxury fashion brands, some of the major issues include domain name pirating and counterfeiting. At Stuart Weitzman, counterfeits of the 5050 boot have been a particular challenge. There are copycat products on the market from China that not only copy the style of the boot, they also use Stuart Weitzman’s trademark on the fake product. Kolsun explains that “the counterfeit problem is enormous, so we have to pick and choose our battles.” When it comes down to how much of an impact counterfeits have on a company’s bottom line, she says, “you never really know how much it costs your business” since the number of fakes seized is usually a small percentage of the quantity of items that counterfeiters are actually introducing to the market.
Forgione states that “the sale and distribution of counterfeit designer goods in mass quantities has become fairly commonplace in avenues like business-to-business trade portals that facilitate exchanges of goods with the click of a button (e.g., Alibaba, Taobao, etc.), so brand owners in the fashion industry have begun focusing more attention and resources on enforcement in these types of problematic places.”
Trademark Protection Strategies
Another way to protect a trademark may be to extend the brand. In August 2013, we saw packaged beauty lines launched from Fashion Week veterans Michael Kors and Marc Jacobs. Instead of using the runway to showcase only their clothes, models in Kors’ runway show will presumably be wearing Kors’ makeup, jewelry, and shoes. Not only will these collections bring the designers more profits, as they are sold in Macy’s and Sephora, but by continually marketing their brands to a larger crowd who will recognize their logos it may lead to more people noticing a counterfeit and choosing to spend the extra cash for the real deal.
This type of brand expansion also calls for a more extensive and carefully researched mark. According to Kolsun, “Many brands are lifestyle brands — you may have a name that’s good for apparel and someone else may have it in home textiles. So, if you want to expand in the future, you will want to make sure it’s clear in a couple of different categories.” A strong mark or design with longevity and consistent branding in an ever-changing industry is essential to tapping every possible market.
Another trend in the fashion industry, Kolsun points out, has been the “sale and acquisition of companies and the emergence of a handful of big holding companies that manage brands like Victoria’s Secret and Liz Claiborne.” She also sees the emergence of “fast fashion” as a new development in the fashion industry, where brands like H&M and Forever 21 can create “designs very quickly and get them on the market.”
Since luxury goods may be less accessible to the general public, there’s also the option of going to Target for the latest Phillip Lim collaboration, available September 15, 2013. This has proven to be a successful formula, looking at the mad rush to buy Missoni when it launched at Target in 2011 and Prabal Gurung’s collection selling out within hours last February. Other successful collaborations of luxury brands that have been marketed at lower-end retail chains are Vera Wang at Kohl’s, Issa London at Banana Republic, Jil Sander at Uniqlo and Stella McCartney for H&M. These designers are realizing new profits from a consumer previously unwilling or unable to shell out hundreds of dollars for a blouse.
Has the need to grow a brand and protect a trademark globally and across as many products as possible changed the way designers create their Fashion Week collections? As you see the looks on the runway this fall (in person or maybe only in photos and videos), keep in mind all the trademark research that went into these looks — from the initial design concept to the styling and the way these images will be marketed. The luxury fashion industry is so much more than this season’s pretty dress.
What are some of your favorite looks and trends from this season?
About the Author
Kristina Scheurle is a Senior Trademark Researcher at Corsearch and joined the company in 2011.
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