In case you aren't sure what generally happens when most brands go up against LVMH Moet Hennessey Louis Vuitton in court, Victoria's Secret found out today. You may recall that British apparel company, Thomas Pink sued Victoria’s Secret UK in a British court in May 2013, after the U.S. lingerie giant set up shop on London’s Bond Street and in Westfield Stratford. In its complaint, Thomas Pink, which maintains a flagship in London, accused Victoria’s Secret of encroaching on its territory, potentially causing customer confusion with its own “PINK” branding, and tarnishing its brand, which is known for quality and tradition (it began trading in London in 1984), while Victoria's Secret's reputation is based on sex.
This prompted Victoria’s Secret to file a declaratory judgment lawsuit in response in an Ohio federal court two months later, seeking clarification of “the rights of the parties, allowing them to continue the peaceful coexistence that has been in place for many years” (aka asking the court to hold that its “Pink” collection is not infringing Thomas Pink’s mark and thus, a holding that allows the companies to co-exist, which they have done peacefully for many years, according to VS). That filing was withdrawn and the lingerie giant (by way of Victoria’s Secret Stores Brand Management, Inc., the owner of its intellectual property rights) filed a new declaratory judgment suit in the Ohio Southern District Court. Why Ohio? Well, that’s where Victoria’s Secret is headquartered. Well, as of today, Thomas Pink has won its infringement case. In his judgment, London's High Court Judge Colin Birss held that Victoria’s Secret has, in fact, infringed Thomas Pink's trademark rights, as customers of the shirt company could be confused into thinking the two brands are in some way associated with one another.
A tiny bit about trademark infringement: In order to prevail on a claim of trademark infringement, a plaintiff (Thomas Pink in this case, as it is the one that filed suit) must establish that it has a valid mark entitled to protection; and that the defendant (Victoria's Secret) used the same or a similar mark in commerce in connection with the sale or advertising of goods or services without the plaintiff's consent. Those two are fairly easy to identify here. What is more difficult is likelihood of confusion, which is the key inquiry in any trademark infringement matter. As distinct from actual confusion, a likelihood of confusion exists when consumers viewing the allegedly infringing mark would likely assume that the product or service it represents is associated with the source of a different product or service identified with a similar mark.
To be a bit more specific, the use of a trademark in connection with the sale of a good constitutes infringement if it is likely to cause consumer confusion as to the source of those goods or as to the sponsorship or approval of such goods. In deciding whether consumers are likely to be confused, the courts will typically look to a number of factors, including: (1) the strength of the mark; (2) the proximity of the goods; (3) the similarity of the marks; (4) evidence of actual confusion; (5) the similarity of marketing channels used; (6) the degree of caution exercised by the typical purchaser; (7) the defendant's intent. Polaroid Corp. v. Polarad Elect. Corp., 287 F.2d 492 (2d Cir.), cert. denied, 368 U.S. 820 (1961). As a general rule, potentially infringing marks are compared in their entirety, including appearance, sound, connotation and commercial impression, to the mark of the moving party. However, whether two marks are similar may require dissecting and comparing the elements of each mark. (Although it is worth noting that the number of factors may vary from each federal circuit (and certainly in the UK v. the U.S.), the principles in determining likelihood of confusion are similar).
Judge Birss held in his written decision that Victoria's Secret's existence in the same geographic territory as Thomas Pink, and its “sexy, mass-market appeal", has been detrimental to the Thomas Pink Brand. Birss stated, Victoria's Secret's "overall business is a legitimate one. Nevertheless, it is one which had been associated with some controversy, no doubt because ‘sexy sells’ [...] The link between [Thomas Pink's] Community trade mark and [Victoria's Secret's] Pink brand will cause consumers to associate the two. This is bound to cause a change in the economic behaviour of the claimant’s customers. The claimant’s trade mark will be associated with a mass market offering, reducing its luxurious reputation. There is every risk that this will lead consumers not to buy products from the claimant when they otherwise would have done.” Moreover, he stated that "consumers are likely to enter one of [Thomas Pink's] shops looking for lingerie and be surprised and disappointed when they find they have made a mistake."
So, what does this ruling mean for Victoria's Secret? It seems that Victoria's Secret will be forced to pay monetary damages over to Thomas Pink, but maybe more importantly, it will no longer be permitted to market or sell its PINK collection (which primarily extends to clothing) in the geographical territory at issue, the European Union. (A determination on the legality of the situation in the U.S. is still pending). While this is quite a tall order, it is limited to one class of goods: clothing. Thus, Thomas Pink does not actually have a total monopoly over the use of the word "Pink." Luckily for Victoria's Secret, it has only been offering PINK goods via shop-in-shops within Victoria's Secret boutiques in the UK, and thus, will not be forced to close any standalone brick and mortar shops as a result of the ruling. While Tomas Pink's legal team is pleased with the ruling, saying: "We are delighted with the outcome of this case, and will continue to protect the considerable investment that has been made into building Thomas Pink into a leading luxury clothing brand," others are skeptical. According to Retail News, Taylor Wessing senior associate Tom Carl said: “This decision gives Thomas Pink relative control over the use of the word pink as a brand in the fashion sector, and means that other traders will need to think carefully about how they use similar branding. This decision does not mean it’s open season for any fashion brand to trade mark and attempt to monopolise colour names. Thomas Pink’s ‘Pink’ trade mark is only registered in a specific logo form – not the word itself – and the court held that it was only valid due to having ‘acquired distinctiveness’ among consumers, having been used as a brand since the company opened its doors in 1984.”
A brand's ability to practice a limited monopoly over a color, assuming it has achieved distinctiveness, should come as no surprise, especially in the case at hand, as the same judge previously ruled in Kraft Foods Group Inc.'s favor, holding that its company, Cadbury had sole rights to a distinctive shade of purple. Before that, a New York federal judge ruled largely in footwear designer Christian Louboutin's favor in the very public Christian Louboutin v. Yves Saint Laurent case (Read up on that important case here, if you have not already). Considering that Louboutin’s trademark protects the red sole of a shoe (but not the use of a red sole on a monochromatic red shoe), the ability to own a color, so to speak, is alive and well, as long as there is an element of distinctiveness. According to Stuart Weitzman general counsel Barbara Kolsun, “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."
Victoria's Secret's case in Ohio is still pending. So, stay tuned ...