I had the pleasure of attending the Federal Bar Fashion Law Conference a few weeks ago. Great speakers presented business & unique legal issues affecting the Fashion Industry. Presentations included discussions about 3D printing technology, licensing, Intellectual Property, Counterfeiting, Emerging Markets, & Fashion Financing.
An area of great interest to me is the issue of trademark counterfeiting which is one of the main issues that plagues fashion companies. Trademark counterfeit occurs when a good is made identical or substantially indistinguishable from the trademarked good. Heather McDonald, one of the many panelists, discussed brand protection and anti-counterfeiting strategies. She has extensive experience in the area of anti-counterfeiting litigation conducting many civil seizures of counterfeit goods, she was successful in her very first seizure back in 1986. The impact of counterfeit goods costs companies as well as the economy lots of money, but that is not the only cost. Child labor has been connected to the making of counterfeit goods. Heather discussed an article written in Harper’s Bazaar called “The Human Costs of Fakes”, which discussed Chinese factories hiring girls 13 years of age to make counterfeit handbags, like Gucci, Chanel, Prada etc. The girls lived in slave conditions, locked rooms heated by propane heaters. Four girls died when there was a carbon monixide leak and their bodies were dumped in graves to avoid any news coverage. Such a sad story, that hopefully has detered people from buying these counterfeit goods. If people knew this is what they were supporting, I would pray they would stop purchasing such goods.
All of this is relevant to the fashion client, because these companies are ultimately loosing money due to the making of these goods. Here are some protection tools that can be used to protect your companies: Federal Criminal Statues, State Criminal Statutes, Civil(Real Estate, Civil Seizure), & Customs. What companies must do to protect themselves:
1) Enforce. All enforcement of trademarks requires that your trademark be registered with the USPTO, report your trademark with customs & make sure you keep recordation & registration up to date.
2)Training. Train your staff to catch counterfeit goods that are being returned to stores.
3) Third Party Actions. Collecting from alternative sources, when assets of infringer are not readily accessible. Third party liability is an option to go after someone other than the infringer for sale of counterfeit goods, a building owner or a landlord. In New York, under real property law it allows a landlord to be held responsible for the actions of tenants on the property if they had knowledge of what was going on, on the premises and failed to take the appropriate actions to remedy it.
Great information provided by all the speakers. Happy I could attend and share the information with you. Remember to protect your brand & your business!
Who is going to prove who’s more gangsta. Fashion companies seem to always be at war where trademarks are concerned. So, who will prevail as the biggest G? I predict Guess. If you look at some of the patterns of these cases, the underdog always wins. The one that is accused of the infringing seems to come out as the victor when major Fashion companies are involved. This suit was filed three years ago and has only recently went to trial. Gucci accuses Guess of using their famous logo and designs causing confusion among consumers and of course dilution of the brand.
A classic and entertaining movie by Alfred Hitchcock. Grace Kelly is beautiful and of course graceful and that handsome Cary Grant. Can we all get a cat like that or at the very least an honest John Robie, watch the movie to follow my cheeky dialogue. The iconic fifties dresses and style is seared into my memory. Much like the movie, to catch a thief in the fashion world can prove to be near impossible, but with persistence it can happen.
John Robie, named the “Cat” in his burglary days, was being copied and framed. He is finally vindicated when the impersonator is caught. However, in the fashion world when designs are copied not many impersonators are found or for that matter pursued. I speak not for the bigger designers like DVF that are able to go after most of their infringers. I speak of the independent up and coming designers that don’t have the means of constant monitoring of their designs and/or trademarks.
However, there are a few inexpensive ways you can prevent the Cat from stealing your vision:
1) Google Alerts: Set up alerts with Google to stay abreast on your industry. Additionally, these alerts can tell you if other companies have set-up websites using your company name.
2)USPTO: You can check the Trademark Office’s database in order to see what trademarks have been filed. However, if your trademark is registered before the Cat it should be rejected based on the similarity marks and the likelihood of confusion. If your trademark is governed by common-law you can still challenge the validity of the registered trademark if you can prove that your use was of trademark was in the public domain before the infringer.
3) Cease & Desist: If you are unable to retain a full-time attorney, you can still consult with one to draft a cease & desist letter for you. You can definitely draft a cease & desist letter on your own behalf, but perhaps the weight of legal representation may get the matter resolved quicker.
4)Policing E-Commerce Sites: To prevent and limit the sale of counterfeit goods you can check sites like E-Bay, Amazon, Alibaba and Google.
5)Social Networking: Create company’s official website, as well as Facebook, Twitter, Linkedin, Ning accounts to avoid confusion.
With the basic tools in hand you can catch your thief!
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Good Morning to the Versace enthusiasts that stood on line to get into H&M at 8 a.m.! I already see that some are selling the line on e-Bay for $750.00, in a similar fashion to the Missoni line put out by Target a few months ago. The thought of dilution of a brand brings to mind the deterioration of a brand due to the counterfeiting of its goods, like Burberry a few years ago, for instance. However, now brand dilution or brand extension is a strategy employed by many designers. Is it coincidence that top brands are linking up with stores like Target, Kohl’s, and H&M?
At first glance it appears that due to the economy top brands are creating fashion lines for the masses to expand their audience and their profits. This very well might be true, since dealing with big department stores can put them in a position that does not yield a profit if the merchandise is not sold, or marked down. But, to play devil’s advocate or an attorney, some say they are interchangeable. Let’s say they are doing it to stay a step ahead and in some way prevent copying of their clothing. It seems that they could be taking a strategic step in diluting their own brands in a positive way. The thought process being “Before they do it, we will do it and make money from it.”
Remember Forever 21, known for copying a dress of a top designer in the very moments of seeing it walk down the runway. Why did Vera Wang create a bridal line inspired by Kim Kardashian’s gown for David Bridal? In essence she is knocking off her own designs. She found a way to capitalize on a market, thereby cutting off those designers that live to copy. So, do luxury brands like Versace and Missoni take away from their top-selling lines by creating these lines for the masses. I believe in the long run, if done right, no they won’t but it also depends on the luxury brand and the overall marketing strategy for the high-end line and the new line made for the masses. We will follow how this new business model unfolds for these top luxury brands.