Michael Kors Continues Fight Against Cybersquatters

Michael Kors LLC is the latest designer to unleash the judicial system against online counterfeiters. On Thursday, the designer won a 2.4 million dollar judgment against 35 infringing Web sites, including MichaelKors-Outlet.net, CheapMichaelKorsOutlet.com and MichaelKorsSale.com, all of which sold counterfeit handbags, shoes, wallets, belts, eyewear, watches and jewelry bearing the brand’s trademarks. The price points of these counterfeit goods were between $350 and $800, similar to those listed for actual Michael Kors products, which along with the name of the sites caused consumer confusion.

Following the victories of Hermes and Burberry, the Kors case indicates that the judicial system is not going to let these sites freely circumvent the laws. And while the defedants hardly ever abide by the system and pay damages, the judgments do put a stop to the cybersquatters operations and serve as a message. The rulings not only attack the sites themselves, but they also implicate search engines like Google and Yahoo, and social media sites such as Twitter and Facebook, making them responsible for getting rid of any counterfeit site found on their platforms and for delisting any infringing domain names from their Web searches. However, this fight is going to be a long one, for as soon as the court shuts down one site, others crop up and flourish. Nevertheless, it is a signficant step forward for fashion law that the courts are willing to continue the attack on these illegal online portals of counterfeit goods.

Fake Hermès Crime Ring Busted

Last week, the French police dismantled an international crime ring that was in the business of producing counterfeit Hermès bags. According to WWD, a dozen arrests were made and the company suspects that several Hermès employees were also involved.

The ring consisted of secret workshops filled with precious leather skins. While the debate over whether counterfeiting has any effect on the company's brand may continue, here are some numbers that might help give our readers some perspective:

- In this crime ring alone, a single workshop has been estimated to be driving sales of about 22 million dollars

- Counterfeiting costs France 6 billion euros, or $7.5 billion dollars, in lost revenue every year

This isn't the company's first success in going after counterfeiters. Last month, a U.S. court ordered 34 Web sites selling counterfeit Hermès products to pay the company damages of $100 million dollars. And while these judgments are rarely paid out, luxury companies are continuing the fight because they find more value in the court system's willingness to recognize the ongoing illegal activity and develop a strategy against such criminals than in any payment of damages. Hopefully as the judicial system continues to catch on, the legislative branch will also begin to step up their willingness to provide more IP protection for the fashion industry.

Bogart Estate goes up against Burberry

It was like the case docket gods were smiling on me today. Burberry vs. Bogart peaked my interest for more than one reason. First, anything fashion law or intellectual property law related will always draw out the nerd in me. Second, I love Burberry (mainly the Prorsum line). Third, Humphrey Bogart is the quintessential iconic movie star- rugged, serious, dapper, and just plain cool. Anyone who knows me knows I love old movies. And anyone who is familiar with Humphrey Bogart can understand it when I say that George Clooney has nothing on him. Gentlemen, I highly recommend watching a Bogart movie and taking notes.

Getting back to the case, the dispute arose when Burberry decided to use the iconic image of Humphrey Bogart in a trench coat from the movie Casablanca to create a "historical timeline" on their social media platforms showing how far back the brand goes. Bogart's estate filed a lawsuit in Los Angeles in April claiming that the British brand illegally used the image to promote their products. To see a copy of the complaint, click here. Burberry later filed a counter-claim in Manhattan in early May defending their use of the image under the First Amendment, as it "was not directly connected to the sale of any merchandise" and was properly licensed to Burberry after they paid for the image from the Corbis photo agency. However, Bogart's estate is also claiming that the trench coat worn by the actor was not made by Burberry. Indeed, Stephen Bogart, the son of Humphrey Bogart, is claiming that the trench in question could be from rival British brand Aquascutum.

While the state laws that govern publicity rights protect against the use of one's image from being commercially exploited, Burberry did obtain a valid license for using the image on its timeline. Furthermore, the British brand did not run image the image in a major advertising campaign, but rather through its social media platforms. This form of marketing has become increasingly popular and the laws remain unclear on whether the use of these images violate anyone's right of publicity, especially when they're not directly driving sales.

This case is a fascinating intersection of intellectual property laws with social media marketing and could lead to a precedent if it doesn't settle. TFG will be sure to keep you posted on any further developments.

French Court Favors Zara Over Louboutin In Trademark Dispute

Last week, the Cour de Cassation, the final court of appeal in France, upheld a June 2011 decision by a court of appeal in favor of Zara for selling red-soled shoes similar to Christian Louboutin's Yo Yo heels. This was a major blow to the to the luxury brand's signature trademark, which has also been in dispute in the U.S. case Christian Louboutin vs. YSL.

Christian Louboutin Yo Yo heel (left) vs. Zara red sole heel (right)

In the ruling dated June 22, 2011, the court of appeal stated that the terms of Louboutin’s trademark registration were too vague since it did not contain a Pantone color reference for the red soles. As a result, Louboutin has filed another trademark application seeking to make the relevant changes to the specific color reference. While the ruling has not deterred Louboutin in its determination to fight for its trademark, it does pose the continued question on whether courts will recognize a brand's ability to trademark a color.

Alexander Wang Files Answer in 50M Labor Lawsuit

On Monday, defendant Alexander Wang Inc. filed an answer in federal court in the case Lu et al v. Alexander Wang Incorporated et al denying the allegations made by two former employees of the designer, claiming that the designer had violated New York labor laws. The employees' complaint alleged that they were forced to long hours without overtime in poor working conditions at the designer's factory. The allegations even go so far as to claim that the designer harassed them.

According to WWD, the answer stated that the company and all named defendants “have complied with all applicable wage and hour and leave laws, and there is no basis whatsoever for plaintiffs’ frivolous and entirely unsupportable accusations that defendants have harassed them or discriminated against them on the basis of their race, or on any other protected basis.” Furthermore, the defendants claimed that the plaintiffs are "two disgruntled employees" that are trying to tarnish the designer's name.

Indeed, the designer's Soho store was vandalized after the plaintiffs filed their suit. The plaintiffs are seeking 50 million dollars in damages. TFG will be sure to keep its readers updated on this developing case.