In the past several years, the market for counterfeit goods has grown rampantly. Estimates of the total value of counterfeit goods sold each year range from $1.7 trillion to $4.5 trillion. Makers of luxury goods are among the hardest-hit industries, as well as those dealing in footwear, apparel, fine art, and collectables. The rise of online shopping has further thwarted companies’ ability to protect their brands. Illegitimate sellers on e-commerce marketplaces employ techniques like posting fake positive reviews and using copyrighted branding to reach consumers and sell counterfeit goods.
Allegations of trademark infringement against celebrity-founded brands are not new. In 2015, resort-wear brand Island Company LLC sued Kendall and Kylie Jenner for use of the phrase “Run Away, Fall in Love, Never Return,” which resembled Island Company’s trademark phrase “Quit Your Job, Buy a Ticket, Get A Tan, Fall In Love, Never Return”. The case was settled in January 2016. In 2021, an Italian tribunal ordered social media influencer Chiara Ferragni to pull her snow boots from her footwear line, finding infringement on Tecnica group’s trademark for the world-renowned Moonboot. Now, Vans, Inc., a sneaker company born out of 1960s California counter-culture, alleges trademark infringement by MSCHF, a Brooklyn art collective endorsed by rapper Tyga.…
A new draft report to Congress by the U.S. Environmental Protection Agency and the National Oceanic and Atmospheric Administration on behalf of the Interagency Marine Debris Coordinating Committee cites textiles and the fashion industry as the leading sources of microfiber pollution in the environment. While the draft report acknowledges uncertainty about how microfiber pollution impacts the environment and human health, the report’s authors recommend that the textile and fashion industry—along with manufacturers of clothes washers and dryers and personal care products—design their products to prevent microfibers from being released into the environment.
The draft report was required to be developed pursuant to the Save Our Seas 2.0 Act, enacted in 2020 on a bipartisan basis to address problems associated with marine debris and plastics in the ocean. It has been made available for public comment, which closes October 17, 2022.…
In the article, “H&M class action: what lawyers told us”, featured in Apparel Insider, Partner Jason Stiehl commented on a recent class action complaint filed against H&M over its use of Higg Sustainability labels and its justification to charge premium prices for sustainable clothing. Stiehl provided insight on the importance to tighten internal systems…
Earlier this year, Hermès filed a trademark infringement suit against Los Angeles-based designer Mason Rothschild for creating and selling faux-fur digital renditions of the luxury Hermès Birkin handbags and using a collection of 100 NFTs, titled “MetaBirkins,” to authenticate the digital images. In response, Rothschild filed a motion to dismiss Hermès’ trademark infringement claim under the Rogers test on the basis that the digital images of the Birkin bags are “art” and, therefore, receive First Amendment protection. Hermès opposed, arguing that the Polaroid factors— instead of the Rogers test—should apply, to assess likelihood of confusion. On May 18, 2022, the court denied Rothschild’s motion to dismiss, concluding that: (1) the Rogers test applies to the trademark infringement analysis of the “MetaBirkins” title, and (2) the Polaroid factors apply to the explicit misleadingness analysis.…
We recently reported on the Federal Trade Commission’s (“FTC”) increased enforcement against review curation policies that disproportionately restrict or remove negative reviews. Now, the Consumer Financial Protection Bureau (“CFPB”) has issued a Bulletin that makes clear that the suppression or manipulation of consumer reviews posted about financial products and services is an unfair and deceptive act or practice. The CFPB’s Bulletin drew from recent FTC guidance and enforcement activity as well as the Consumer Review Fairness Act of 2016 and stated that conduct such as (1) deceptively posting fake reviews that appear independent, (2) suppressing or manipulating reviews such as by limiting the posting of negative reviews, or (3) imposing contractual ‘gag’ clauses on consumers in form contracts that prohibit honest reviews is generally a violation of the Consumer Financial Protection Act.
Continue Reading CFPB Announces Policy Against Consumer Review Suppression
A few months after putting the nation’s top advertisers on notice that consumer endorsements are high priority, the Federal Trade Commission (“FTC”) recently announced a settlement with online retail company Fashion Nova, LLC (“Fashion Nova”) for allegedly blocking negative reviews from being posted on its website, signaling to retailers that the FTC is cracking down on companies that inflate consumer reviews. In conjunction with the settlement, the FTC also released guidance regarding the collection and publication of online reviews directed to online retailers and review platforms and announced that it sent letters to 10 companies offering review management services.
Continue Reading FTC Ramps Up Enforcement on Consumer Reviews
In the first episode of ACC Chicago’s It’s All Hearsay podcast, Crowell & Moring attorneys Preetha Chakrabarti and Josh Pond expanded upon their “Year of the Knock-Off” webinar. This discussion analyzed trends in counterfeit products, related business concerns, and strategies for countering counterfeits at the U.S. International Trade Commission.
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Earlier this month, New York State Assemblywoman Kelles and State Senator Biaggi introduced the Fashion Sustainability and Social Accountability Act in the New York State Assembly and Senate. If the legislation becomes law, it would amend New York’s general business law to require fashion companies to publicly disclose extensive information about their environmental, social, and governance (“ESG”) policies, impacts, and targets for improvement.
Specifically, the Act would require all fashion retail sellers and manufacturers doing business in New York that have annual worldwide gross receipts surpassing $100 million to disclose:
- ESG due diligence policies and processes;
- ESG outcomes, including actual or possible negative environmental and social impacts; and
- Binding targets for prevention and improvement of ESG outcomes and policies.
On November 11, 2021 activewear apparel brand lululemon athletica canada inc. (“lululemon”) sent a cease and desist letter to interactive fitness platform Peloton Interactive, Inc. (“Peloton”), alleging that five of Peloton’s products, including four bras and a pair of leggings, were infringing upon six of lululemon’s design patents and that Peloton’s One Luxe Tight infringed upon lululemon’s Align pant trade dress.
Rather than spinning its wheels, on November 24, 2021, Peloton responded with an action for declaratory judgment against lululemon in the Southern District of New York, seeking (1) a determination that Peloton did not infringe lululemon’s design patents, (2) invalidity of these patents, and (3) a declaration that lululemon does not have trade dress rights in the Align pant and/or that Peloton did not infringe upon this trade dress. Specifically, Peloton argues that there are clear and obvious differences between its products and lululemon’s design patents, the presence of the brands’ trademarks on the products eliminates confusion, and the design patents are anticipated and/or obvious based on prior art. For example, Peloton emphasizes that the back of its Peloton Branded Strappy Bra is cut straight across and has a mesh layer, while the design patents depict a scooped back and no mesh layer, among other differences. Peloton also argues that the asserted Align trade dress does not possess the requisite distinctiveness to be protectable, and even if it does, Pelton’s One Luxe Tight is not likely to cause marketplace confusion.
Continue Reading Peloton and lululemon Yet to Work Things Out, File Cross Lawsuits