A legal battle over Balenciaga’s $275 air freshener-esque key chains has come to an end. On the heels of the first mediation session between Car-Freshner Corporation and Balenciaga in connection with rival lawsuits over the fashion brand’s “deliberate” infringement of Car-Freshner’s trade dress-protected LITTLETREES design. On Tuesday, Car-Freshner moved to put an end to the fight, stating that both it and Balenciaga have agreed to voluntarily dismiss their claims, meaning that the parties managed to settle their differences in mediation.
Balenciaga and its pricey lookalike key chains made headlines in October when Car-Freshner named them in a trade dress infringement and unfair competition lawsuit, asserting that Balenciaga jacked its LITTLETREES design, which thanks to 66 years of continuous use by Car-Freshner has become a “staple of American culture, familiar to millions of consumers who encounter these products and marks in a wide variety of commercial contexts.”
Not merely a case of legally-permissible inspiration (as opposed to actionable imitation), Car-Freshner argued that Balenciaga’s copies were exact. Everything from “the contours of the [Balenciaga design], which track exactly the shape and dimensions of a genuine LITTLETREES Air Freshener” to “the specific colors, which are [same as the ones] associated with some of the popular scents of the LITTLETREES Air Fresheners” was directly reproduced without license or authorization.
Such conduct by Balenciaga was carried out “willfully, in bad faith, or with malicious intent,” Car-Freshner asserted in its complaint. And beyond that, it “betrays reckless disregard for the plaintiffs’ trademark rights,” and was done for the purpose of attempting to“mislead the public into believing that [its] products emanate from Car-Freshner.”
Balenciaga – which was, at the time, already in the midst of a since-settled lawsuit for allegedly copying a souvenir-inspired bag (in which creative director Demna Gvaslia was blasted for his “willingness to copy the work of others”) – responded to Car-Freshner’s lawsuit by denying any wrongdoing on its part and lodging a claim of its own.
The Paris-based brand denied nearly all of Car-Freshner‘s claims, and asserted that in reality, Car-Freshner lacks any trade dress rights because the tree-shaped air freshener design is functional. Balenciaga’s counsel pointed to a since-expired 1962 utility patent issued to Car-Fresher as proof that the tree shape is, in fact, useful (as bar to trademark registration), as opposed to merely indicative of the Car-Freshner brand. More than that, the brand asked the court to declare that it is not infringing or diluting Car-Freshner’s trade dress rights, and that it is also not engaging in unfair competition.
The court will now review the parties’ agreement to call in quits on the case, and ultimately, will agree to formally dismiss the case.
As for what the confidential terms of the settlement entail: potentially an agreement that Balenciaga will not reintroduce the keychains without licensing the design from Car-Freshner this time, a retroactive licensing fee paid by Balenciaga for the keychains it sold without a license, and … maybe even a share of the profits that Balenciaga made in connection with the sale of the allegedly infringing products.
* The case is CAR-FRESHNER Corporation and Julius Sämann Ltd., v. Balenciaga America, Inc., 1:18-cv-09629 (SDNY).