In fashion, runway garments are rarely the money-making products for brands. Instead, handbags and footwear, small leather goods and licensed products are the hot-sellers, and so, it is problematic that Gucci is selling a whole lot of iPhone cases complete with credit card holders on the back, according to a new lawsuit. CardShark, LLC alleges in a lawsuit filed late last month in a New York federal court that the Italian design house is running afoul of the law – patent law to be exact – by including credit card pockets on the backs of some of its hot-selling iPhone cases.
Chicago-based Cardshark is arguing that Gucci “has directly and indirectly infringed” its utility patent – number 8,381,904 – which “generally relates to a wireless handheld device protective wallet covering with certain features, including a window housing on the front side of the product, a rear protective face, with an externally accessible pocket that allows the insertion and removal of cards or paper currency.” In short: Cardshark is claiming protection over just about any phone case with a cardholder on the back.
The company points to an array of Gucci phone cases, including the GG Supreme bees iPhone 7 case, Gucci Animalier Bee Leather iPhone 7 Case, Gucci Embroidered Angry Cat GG Supreme iPhone 7 Case, Gucci GG Love iPhone 7 Case, and Gucci Tiger L'Aveugle Par Amour Leather iPhone 7 Case, among others, which it claims make use of elements covered by its ‘904 patent “without consent of, authority of, or license from [Cardshark].” As a result of “Gucci’s acts of infringement,” Cardshark claims that it “has suffered and will continue to suffer damages in an amount to be proven at trial.”
As for whether the case will go to trial, it seems unlikely given that most, if not all of, the cases that Cardshark has filed to date, including cases against Kate Spade, and Michael Kors, among others brands based on similar claims, have settled before trial.
While Gucci could certainly fight back (and potentially prevail based on prior art that would limit the actual scope of Cardshark's protections) against the alleged expansiveness of Cardshark’s patent – i.e., Gucci could argue that Cardshark does not have exclusive rights in all phone cases with a back pocket and thus, it does not have the right to prevent others from manufacturing and selling phone cases with a back pocket, it is often more a matter of time and money when it comes to patent lawsuits than the actual merit of the claims at hand.
Settlement long before trial has proven a common outcome in patent infringement cases, as it tends to be much cheaper for the defendant (Gucci in this case) to settle a case or agree to licensing terms of say $100,000, rather than fight even if the defendant is confident that the outcome would be in its favor.
A representative for Gucci declined to comment on the case.
* The case is Cardshark, LLC v. Gucci America, Inc., 1:18-cv-05803 (SDNY).