The recent global outbreak of the coronavirus is causing many buyer parties in mergers and acquisitions, including (or maybe, especially) in the highly-affected retail landscape, to evaluate what effect, if any, the pandemic may have – or has already had – on the business and operations of the targets that they are seeking to acquire. One component of these evaluations will certainly be whether a public health crisis, such as COVID-19, is sufficient to trigger a material adverse effect (“MAE”) clause and permit a buyer to terminate a transaction in anticipation of deterioration of the target’s business and financial performance due to the pandemic. 

What is an MAE clause?

Generally, an MAE clause in the mergers and acquisitions context permits a buyer to terminate a proposed transaction or agreement if, as a result of an event or series of events, there has occurred a significant or material deterioration in the financial health of the target or in the stability of the target’s business between the signing of the agreement and the closing. In essence, an MAE clause functions as a tool for risk allocation by placing the general risk of MAE on the seller and using exceptions to reallocate specific categories of risk to the buyer. In other words, exclusions from these exceptions return risks back to the seller. 

Although unique to each transaction and agreement, exceptions to MAE claims (i.e., where the buyer will not be deemed to have a legitimate reason to terminate a transaction based on alleged MAE) generally include: (i) general economic or political conditions in any country where a target operates; (ii) changes or conditions generally affecting a target’s industry; (iii) changes in the market price or trading volume of a target’s securities or the target’s credit ratings; (iv) geopolitical conditions, such as acts of war, sabotage, terrorism or calamity; and (v) natural disasters, such as hurricane, tornado, flood, or earthquake. These are generally considered “systemic risks” that would affect all parties in a transaction and not just the target. It should be noted that risks related to contagious disease, such as “pandemics,” “epidemics,” and “public health crises,” have not been included as commonly as MAE exceptions in purchase or merger agreements entered into prior to the COVID-19 outbreak. However, that is now likely to change. 

The exceptions to MAE clauses are normally subject to a disproportionate-effect exclusion, which returns the risk to the seller (i.e., giving the buyer the right to terminate) to the extent that an event falling into one of the exceptions disproportionately affects the target company as compared to other participants in the industry.

Courts have been reluctant to find that MAEs have occurred and thus allow buyers to terminate the agreements. However, in a recent case, Akorn, Inc. v. Fresenius Kabi AG, C.A., No. 2018-0300-JTL (Del. Ch. October 1, 2018), the Delaware Court of Chancery determined that an MAE existed and that the buyer had validly terminated a merger agreement. In so finding, the court observed that an MAE must “substantially threaten” the earnings potential of the entire business of the target “in a durationally significant manner.” The court also elaborated that the contracting parties should specifically articulate in their agreement the special circumstances or conditions that the parties believe constitute exceptions and exclusions to MAE provisions.

Is COVID-19 an MAE?

For transactions for which agreements have been signed without specific inclusion of “pandemic” or similar words as exceptions to the MAE clauses, whether an MAE is deemed to have occurred ultimately depends on a facts-based inquiry showing whether the effects of COVID-19 substantially threaten the target’s overall earnings potential in a durationally-significant manner. Buyers would want to argue that COVID-19 will likely last for a prolonged period of time and will affect the target and its industry in particular disproportionately. However, due to its recent outbreak starting at the end of 2019, its duration and impact are not yet apparent and are hard to predict. Therefore, it may be premature to assess whether COVID-19 is likely an MAE for specific transactions based on its duration and industry impact. In that case, the buyers’ argument may not succeed. Furthermore, even if “pandemic” or similar words are not expressly excluded, to limit buyers’ ability to terminate the transactions, sellers would want to rely on other exceptions to the MAE clauses, such as conditions generally affecting a country and national calamity. 

For ongoing negotiations for prospective transactions, the contracting parties should give careful consideration to crafting the MAE provisions in light of the COVID-19 outbreak. Sellers may want to add an express exclusion for COVID-19 and other pandemics, in which case the impact of COVID-19 will not allow buyers to terminate the agreements on the basis of an MAE. For example, some recent deals negotiated after the outbreak specifically include language such as “epidemic, pandemic or disease outbreak (including the COVID-19 virus)” as exceptions to the MAE clause. 

However, even when an MAE clause explicitly or generally includes language to exclude COVID-19 from the definition of an MAE (to the seller’s benefit), it may also include a disproportionate-effect exclusion (to the buyer’s benefit) to provide that such exception does not apply when the effect of COVID-19 outbreak has a disproportionate adverse effect on the target relative to the adverse effect it has on other companies operating in the same industry as the target.

What should a concerned party do now?

If a party to a mergers and acquisitions transaction is concerned about whether the COVID-19 outbreak could constitute an MAE and thus impact the transaction, it is advisable to consult with legal counsel to review the language of the MAE clause in the agreement to determine if exceptions to MAEs include the COVID-19 outbreak explicitly or generally. Then, a facts-based inquiry should be performed to evaluate how the COVID-19 outbreak has impacted the business of the target thus far and how it might do so in the long-term. Moreover, records and data demonstrating the financial impact, which may be needed later, should be accurately documented and properly maintained. 

In terms of other industry updates about the effect of COVID-19 on mergers and acquisitions, on March 17, 2020, the Antitrust Division of the Department of Justice (DOJ) announced that for mergers currently pending or that may be proposed, the contracting parties should add an additional 30 days to their timing agreements to allow DOJ to complete its review of the transactions after the parties have complied with document requests. This temporary change will remain in place during the pendency of COVID-19. 

Kathleen M. Porter is an intellectual property and technology lawyer, and a partner in Robinson & Cole LLP’s Business Transactions Group. Anna Jinhua Wang is a member of the firm’s Business Transactions Group. Michael Wirvin is a member of the firm’s Business Transactions Group and a member of its Managing Committee. 

Hermès revealed on Thursday that its sales fell by 7.7 percent in the first quarter of the year to $1.63 billion as the Coronavirus outbreak forced it to close up its workshops and stores across the globe. But while the stalwart French luxury brand’s revenue might be down, that 7.7 percent is less than the expected 12 percent drop, prompting analysts to call the financial results for the three month period  “the strongest organic growth performance of the luxury goods sector.” 

Reflecting on the quarter, Hermès reported that its Leather Goods and Saddlery business saw some of the smallest declines in sales (6 percent), beaten only by its Perfumes group (down 3 percent) and its “Other” business lines, which were actually up by 4 percent, thanks, in large part, to its Jewelry offerings. Ready-to-wear sales were down by 11 percent for the quarter, and Silk and Textiles fell by 20 percent, having been “more severely penalized by the decline in sales prior to the store closures.”

Sales in Mainland China remained relatively flat for the first three months of the year after benefitting from “a very good month of January due to the Chinese New Year,” the brand revealed on an investor call on Thursday, but sales dropped off in the country at the end of the month due to the COVID-19 crisis. Having reopened all of its mainland Chinese stores this month, Hermès says that local clients are returning to stores, and it is preparing for “a bounce back in demand,” which was seemingly foreshadowed by $2.7 million that it reportedly brought in on a single day when it reopened its Guangzhou flagship. 

Looking ahead, the 183-year old company says that “sales in the second quarter will be significantly impacted by the closures of a significant part of the network,” namely, the U.S. and Europe, with its ready-to-wear division is likely to suffer the most during the global health pandemic, as “it is seasonal and driven by store traffic.” As for leather goods, the brand says that its “investments in production capacity have been maintained,” and so, output is expected to remain the same as last year. 

Still yet, Hermès says that while its stores have been closed, it enjoyed a “strong” e-commerce performance in January and February, with its online channel has experienced 50 percent growth in the first quarter of the year, with sizable growth coming from China and Japan, in particular. 

“In the medium term, despite growing economic, geopolitical and monetary uncertainties around the world,” Hermès CEO Axel Dumas stated on Thursday that the group “confirms an ambitious goal for revenue growth at constant exchange rates.”

In a note on Thursday, Bernstein analyst Luca Solca asserted that Hermès’ “better than expected results … stand up to its reputation,” but counters that luxury brands across the board can expect a “sharp decline in consumer demand – and possibly medium-term damage to consumer confidence and propensity to spend,” while Hermès, in particular, may suffer from a “reduced ‘rarity effect,’ perceived exclusivity, and – ultimately – brand desirability long-term,” should it focus too significantly on “higher leather goods volumes as silk declines.” 

In terms of demand for the house’s most coveted creations – i.e., its Birkin and Kelly bags – as of now, it has not dropped off from a resale perspective. In a discussion with Solca early this week, as reported by Bloomberg’s Robert Williams, Max Bittner, CEO of Paris-based luxury resale site Vestiaire Collective, said his company has seen “some initial indicators” that sales for those models are “better now” than in previous periods. 

At the same time, Jeffrey Berk, the co-founder of Prive Porter, an Hermès-only reseller, said that he is “moving more of the handbags than ever,” having told TFL last month that sales on his end are not faltering amidst the global health pandemic. In fact, the number of new customers that Prive Porter saw in March, alone, was up. “Our customers are super-affluent and are largely immune to the financial impact of this Black Swan moment, for right now anyway.”

Among the Alexander McQueen, Balenciaga, Gucci, Saint Laurent, and Valentino wares being offered up on München-based MyTheresa’s e-commerce website is an “oversized” bright yellow and black sweater from Italian fashion brand Alanui. With its intricately crafted geometric knitted jacquard made of wool, alpaca, and cashmere fibers, and accents of carefully woven fringe trim, MyTheresa describes the $2,500-plus Ravenstail Knitted Coat as “a wearable objets d’art,” one that comes straight from Alanui founder Nicolò Oddi’s workshop in Milan. 

Look beyond the extravagant craftsmanship of the sweater from Alanui, a brand that is “defined by its colorful jacquard knitwear that pays homage to Native-American iconography,” and there is a problem. According to a Juneau, Alaska-based nonprofit organization, the sweater runs afoul of the law, and so do MyTheresa and its parent company Neiman Marcus for selling it.

In the striking new lawsuit that it filed in a federal court in Alaska on Monday, Sealaska Heritage Institute, Inc. (“SHI”) asserts that MyTheresa and Neiman Marcus are on the hook for selling the allegedly infringing sweater, which not only hijacks a copyright protected pattern, but also co-opts the name of a “specific, defined, and famous style of weaving and pattern” that is associated with Native American groups, namely, the Tlingit, Haida, and Tsimshian, thereby, violating a number of federal and state laws. (Alanui is not named as a defendant in the lawsuit).

Due to the “substantial copying” embodied in the Alanui sweater, which comes directly from a woven piece of art, called “Discovering the Angles of an Electrified Heart” created by Clarissa Rizal, “an Alaska Native resident,” SHI a nonprofit that was “established to perpetuate and enhance the Tlingit, Haida, and Tsimshian cultures of Southeast Alaska” claims that the retailers are violating federal copyright law by selling it.

By making use of a design that is “substantially similar” to that of Rizal’s registered work, for which SHI is the “exclusive world-wide licensee,” MyTheresa and Neiman Marcus have allegedly infringed SHI’s various exclusive rights in the work (including its right to reproduce the work and to prepare derivate works based on the original), and as a result, have violated its federal copyrights in the work.

This same conduct of MyTheresa and Neiman Marcus also gives rise to a violation of the Alaska Unfair Trade Practices and Consumer Protection Act, according to SHI’s complaint, as Rizal’s work is “an authentic piece of Alaska Native handicraft created by a resident of Alaska,” and thereby, protected against such alleged “unfair methods of competition, and unfair or deceptive acts or practices in the conduct of trade.”

Rizal’s “Discovering the Angles of an Electrified Heart” (left) & Alanui’s sweater (right)

More than merely running afoul of copyright law, SHI claims that MyTheresa and co. have engaged in False Designation of Origin by using the “Ravenstail” name in connection with the sweater, as their use of “the famous and distinctive Ravenstail term in connection with the sale of the [sweater] falsely suggests [its] origin as being the Tlingit, Haida, and Tsimshian peoples, and is likely to cause confusion or deceive as to the affiliation, sponsorship, or approval of the defendants’ product.” 

Still yet, SHI goes on to also accuse MyTheresa and Neiman Marcus which is reportedly on the brink of filing for Chapter 11 bankruptcy protection of violating the Indian Arts and Crafts Act (“IACA”). A federal law that was passed in 1991, the IACA prohibits the “misrepresentation in the marketing of Indian arts and crafts products within the U.S.” In short: it prohibits non-natives from selling  “any art or craft product in a manner that falsely suggests it was produced … by an Indian or Indian tribe.” 

Despite such protection against misrepresentation, that is precisely what MyTheresa did, according to SHI, when it sold the lookalike sweater under the “Ravenstail” name, which “has for hundreds of years exclusively identified Tlingit, Haida, and Tsimshian products, specifically a textile woven in a specific manner and with a certain design,” and thus, “exclusively identifies products made by the Tlingit, Haida, and Tsimshian peoples.” 

Since “the defendants are not Indians, Indian Tribes, or Indian Arts and Crafts organizations as defined by IACA,” their sale of the sweater under the “Ravenstail” name is a violation of the IACA, according to SHI, which says that after learning that the defendants were selling the sweater back in August 2019, it alerted Neiman Marcus – by way of its “online customer service mechanism” –  of the “problematic and improper nature of the product.” However, despite “being made aware of the impropriety of their actions,” SHI claims that “the defendants continued to offer for sale and sell the infringing and offensive products,” and in at least some cases, are still doing so. 

With the foregoing in mind, SHI has set forth claims of copyright infringement, false designation of origin, and violations of the IACA and Alaska Unfair Trade Practices and Consumer Protection Act, and is seeking no small amount of damages. In connection with the IACA claim, alone, SHI argues that it is entitled to “not less than $1,000 for each day that the ‘Ravenstail Knitted Coat’ was sold, or offered or displayed for sale, for each aggrieved individual Indian, Indian tribe, or Indian arts and crafts organization.” Moreover, the IACA states that if a business violates the Act, it can face civil penalties of up to $1,000,000.

In a statement to the AP on Monday, SHI’s counsel Jacob Adams said that the newly-filed suit “is part of a larger movement to recognize the rights of indigenous people to their cultural items,” as these items have “for a very long time, been seen as kind of resources that anyone can use.” The result, Adams says “goes beyond inspiration to outright violation.“

While the case is a relatively unique one in which a claim of appropriation has a basis in copyright law (there are not any internationally-recognized legal rights to protect traditional apparel and accessories designs), the IACA is not entirely unheard of. In fact, it has been raised against fashion companies in the past, most famously in connection with the case that the Navajo Nation filed against Urban Outfitters in 2012. In that case, the Navajo Nation accused the retailer of violating the IACA by selling a whole host of products – from necklaces and jackets to underwear and flasks – with the “Navajo” name attached to them. 

The Navajo Nation, which is the largest Native American tribe in the U.S., alleged that such use of its name by the retailer violated federal and state trademark laws, as well as the IACA, while Urban Outfitters argued that “Navajo” is a generic term for a certain style or design, and not a designator of a single source (as required for trademark rights to exist), thereby, making its use of the term legally permissible. The case ultimately settled out of court. 

A rep for Neiman Marcus did not respond to a request for comment.

UPDATED (August 29, 2020): SHI has filed an amended complaint to include Milan-based fashion brand Alanui and its founder Caroltta Oddi, as well as New Guards Group and its parent company Farfetched as defendants.

*The case is Sealaska Heritage Institute, Inc., v. Neiman Marcus Group LTD, LLC, Neiman Marcus Group, LLC, Neiman Marcus Group, Inc., and MyTheresa.com, GmbH, 1:20-cv-00002 (D. Alaska). 

A British advertising watchdog is continuing its crack down on influencer marketing. On the heels of asserting this past summer that #BrandAmbassador is not a valid disclosure in accordance with the Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing, and more recently finding that even if an influencer is not explicitly paid for a post, she must disclose if she has some other connection with the brand at play, the British Advertising Standards Authority (“ASA”) is turning its attention to Instagram stories, and whether or not influencers are properly altering their followers of their relationships with brands. 

In a recently-released ruling, the British ASA revealed that after receiving a consumer complaint, it initiated a probe into fast fashion giant ASOS and Zoe Sugg – aka Zoella – after the heavily-followed YouTube personality posted a photo of herself wearing a dress from ASOS to her Instagram story in July 2019, along with the caption, “Lots of you loving the dress I’m wearing in my newest photos! It’s from @missselfridge. Swipe up to shop.” In addition to alerting her followers about where to purchase the dress (“swiping up on the story took users to a product page on the ASOS website,” according to the ASA), she included “additional text at the bottom right-hand side of the image, that stated ‘*affiliate.’”

The problem with Sugg’s post, according to the ASA, a self-regulatory organization tasked with ensuring that advertising across all media in the United Kingdom is free of misleading, harmful or offensive advertisements? The “affiliate” disclosure was “obscured by the direct message icon.” 

In response to the ASA’s investigation, which named both ASOS and Sugg by way of her legal entity Zoe Sugg Ltd, a representative for ASOS “accepted that the disclosure in the story was not sufficiently prominent,” but said the company “believed that in principle the disclosure ‘affiliate’ should be considered adequate to signpost where there is a purely affiliate relationship in place between a brand and influencer.” 

In its decision, dated April 22, the ASA paid specific attention to the use of the term “affiliate.” Citing a September 2019 research report conducted for the ASA by Ipsos MORI on “Labelling of influencer advertising,” the watchdog pointed to “findings [that] demonstrated the challenge of obviously differentiating all types of advertising content – including traditional brand ads from other content on social media platforms,” and asserted that “although the word ‘affiliate’ was obscured on the Instagram story,” it considered whether the term itself “would be sufficient to obviously identify an ad as such.” 

While both ASOS and Sugg – who is “an ASOS affiliate which meant that she could earn commission from ASOS sales through a third-party influencer network” – cited “various examples” in the ASA research report that “they believed supported their argument that ‘affiliate’ was a sufficient label to communicate that content was an affiliate ad,” as distinct from a regular ad, the ASA was unpersuaded. The agency asserted that “in no example where ‘affiliate’ was used in isolation did more than 45 percent of participants recognize it as an ad.” With that in mind, the ASA stated, “We considered that the term ‘affiliate’ was therefore unlikely to be sufficiently clear as a standalone label to ensure affiliate ads were obviously identifiable.”

“We concluded that [post] was not obviously identifiable as an ad,” the ASA states, noting that because Sugg “would receive a commission for any sales generated by ASOS.com from purchases made through the link” that she shared, the post was, in fact, an ad that “did not make clear its commercial intent, and therefore breached the Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing.”

As such, the ASA has ordered that “thead not appear again in the form complained about,” and that going forward, ASOS and Sugg “ensure that affiliate links are obviously identifiable as marketing communications and made clear their commercial intent upfront, for example, by including a clear and prominent identifier such as ‘#ad’ at a minimum.” As is customary for the ASA, there was not a monetary penalty associated with the decision. 

More than merely cracking down on instances of obviously out-of-bounds ads, the ASA is, in actuality, defining the boundaries in connection with what is still an objectively novel form of marketing. Far newer than the traditional television and print advertising models, where the rules are largely well-defined as a result of years of use, influencer marketing has developed relatively quickly into a multi-billion dollar globally-reaching industry, one that was expected to amount to $6.5 billion in value as of 2019. As is often the case with the proliferation of new technologies, the law has struggled to keep up with the rapid rise of the influencer economy and the developments that continue to occur within this sphere. As a result, this is a space that is still rife with uncertainties, a large-scale lack of bright line rules, and an wide array of unchartered examples of how the various legal rules and guidelines that do exist, all of which vary by jurisdiction, will be enforced (or in many cases, not enforced).

In addition to providing guidance of the use of the terms “Brand Ambassador” and “Affiliate,” the ASA has also shed light on how many followers it takes to reach “celebrity” status in the eyes of the Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (hint: 30,000 is apparently enough). Meanwhile, the Competition and Markets Authority published – and has taken various famous figures to task over – its influencer-specific guidance in January 2019, called, “Social media endorsements: being transparent with your followers,” which requires that “any form of reward, including money, gifts of services or products, or the loan of a product, is ‘payment’ – whether you originally asked for it or got sent it out of the blue” be disclosed by way of clear language, such as “#Ad, #Advert, and using the ‘Paid Partnership’ tool on Instagram in addition to these hashtags.”

UGG’s rather litigious parent company Deckers Outdoor Corp. is suing the similarly lawsuit-happy Steve Madden on the basis that its fellow footwear company hijacked one of its protected designs. According to the complaint that Deckers filed in a California federal court on Tuesday, Steve Madden is on the hook for trade dress infringement, unfair competition, and design patent infringement in connection with its manufacture and sale of a fluffy, slingback slipper, one that Deckers claims looks a bit too much like one that its’ UGG brand has sold – and heavily promoted – in recent years. 

In its newly-filed complaint, Goleta, California-based Deckers asserts that “competitor” Steve Madden has actively sold a lookalike pair of “Fuzz” slippers “in an effort to exploit Deckers’ goodwill and the reputation of [UGG’s Fluff Yeah shoe],” and that such “bad faith and unlawful acts have misled and confused consumers, and were intended to cause confusion or to cause mistake, or to deceive as to the affiliation, connection, or association of the [allegedly infringing footwear] with Deckers, and the origin, sponsorship, or approval of the product by Deckers,” with such elements of confusion and mistake being central to a claim of trademark – or here, trade dress – infringement.

Deckers claims that this is not merely a run-of-the-mill example of legally above-board inspiration, and instead, is a case of infringement, as the design of its UGG Fluff Yeah Slide is protected by federal trade dress – a subset of trademark law that extends to the overall image of a product, such as the color, shape, size, and/or configuration, as long as the design has the same source-identifying function as a traditional trademark – and Madden’s infringes upon those rights.

In the case at hand, Deckers alleges that its trade dress for the Fluff Yeah shoe consists of “a slipper and sandal combined into a statement shoe made famous  by the UGG brand [with a] platform, sling back slide; a platform sole with a furry footbed and furry perimeter sides; a wide vamp having a furry exterior; an open toe; and an elastic heel strap extending from one side of the vamp to the other.” 

Interestingly, Deckers claims that in addition to the Fluff Yeah trade dress being “non-functional in its entirety, visually distinctive, and unique in the footwear industry,” the product configuration trade dress is “unique and inherently distinctive,” the latter part of which stands in contrast with the holding in the Walmart v. Sarmara Brothers case in 2000, in which the Supreme Court determined that in an “action for infringement of unregistered trade dress, a product’s design is … protectable, only upon a showing of secondary meaning.” In other words, a product design trade dress can never be inherently distinctive, and thus, must be subject to acquired distinctiveness.

UGG’s Fluff Yeah shoe (left) & Madden’s Fuzz shoe (right)

Despite asserting that the shoe design is inherently distinctive, the footwear group – which also owns Teva, Sanuk, Hoka One One and Kookaburra – goes on to claim, nonetheless, that the Fluff Yeah has acquired distinctiveness. For instance, Deckers alleges that the shoe, itself, “is one of the most well-recognized and commercially successful styles of UGG brand,” with UGG having sold “millions of dollars worth” of the style. As a result of such sales paired with widespread media attention (which is largely the result of the brand gifting the eye-catching slippers to big-name celebrities, including supermodels Gigi and Bella Hadid), and UGG’s advertising of the particular style, all of which act as factors used to establish secondary meaning.

With the foregoing in mind, Deckers claims that “the Fluff Yeah trade dress has achieved a high degree of consumer recognition and secondary meaning, which serves to identify Deckers as the exclusive source of footwear featuring said trade dress,” and thus, “by producing, distributing, advertising, and offering for sale confusingly similar reproductions of [it] … [when] there are numerous other shoe designs in the footwear industry, none of which necessitate copying or imitating the Fluff Yeah trade dress,” Madden has infringed its trade dress rights and also engaged in unfair competition in violation of California state law.

In addition to citing claims of trade dress infringement and unfair competition, both of which center on a likelihood that consumers will be confused as to the source of and/or UGG’s connection to or endorsement of the allegedly infringing products, Deckers points to a design patent that it holds for the “ornamental design of the upper and midsole” of the Fluff Yeah slipper. It claims that while Steve Madden was put on notice of its rights in the shoe design (as a result of the initial “patent pending” label that UGG used in connection with the shoes before its patent was issued), the New York-headquartered footwear brand opted to copy the shoe “knowing the objectively high likelihood that such actions constituted patent infringement,” making its acts “willful” and the case “exceptional” in nature, and thereby, warranting an increased damages award. 

As for the strength of Deckers’ design patent infringement claim, design patent expert and University of Oklahoma College of Law professor Sarah Burstein notes that “design patents protect the actually-claimed design, not larger design concepts.” As such, Burstein says that she does “not think [that Madden’s lookalike slipper] is close enough to infringe Deckers’ patent, as a matter of law.”

Deckers is seeking injunctive relief to permanently bar Madden from further “infringing” its footwear design, has asked the court to force Madden to recall and destroy any and all existing pairs, and is also seeking an array of monetary damages. 

A rep for Steve Madden was not immediately available for comment.

*The case is Deckers Outdoor Corporation v. Steve Madden, LTD., et al, 2:20-cv-03670 (C.D.Cal.)