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Image: adidas

Seven years ago, adidas signed-off on a deal with a budding apparel brand called Aviator Nation. At the center of the parties’ binding covenant: an “express agreement [by Aviator Nation] that it would ‘not produce, manufacture, distribute, sell, offer for sale, advertise, promote, license, or market … any product[s] bearing [adidas’] three-stripe trademark or any design, mark, or feature that is confusingly similar to [adidas’] three-stripe mark” going forward. It turns out, adidas had taken issue with Aviator Nation’s use of a certain 3-stripe design on its apparel, and the parties had managed to avoid litigation thanks to a settlement agreement.

The potential peace that adidas and Aviator Nation – the now-nearly 14-year old brand launched by Paige Mycoskie (sister of Toms founder Blake) – had found by way of that April 2012 agreement did not last long, as roughly 6 months later, adidas claims that it “became aware that [Aviator Nation] was selling apparel featuring three parallel stripes” again. This time, such use, not only amounted a “violation of adidas’s common law and registered trademark rights,” adidas says it was a “breach of the parties’ settlement agreement.”

Again, the parties managed to settle their differences quietly and in a behind-the-scenes – and out of court – capacity, entering into “a letter agreement” in January 2013, “according to which [Aviator Nation would] stop selling the [newest bout of allegedly] infringing apparel.”

Now fast forward 5 years to May 2018. On the heels of adidas’ annual shareholder meeting – which drew some 540 shareholders and shareholder representatives to the Stadthalle Fürth arena in Fürth, Germany – and right in the midst of the Kanye West-induced “slavery was a choice” fiasco that brought adidas under fire due to its long-standing partnership with the rapper-slash-designer, adidas says it discovered that Aviator Nation was up to its old tricks again “offering for sale and selling apparel featuring a stripe design that is confusingly similar to [its] famous three-stripe mark.”

Yet again, Aviator Nation had (allegedly) run afoul of its agreement with adidas, prompting adidas’ counsel to alert the brand of this in July 2018, and a lengthy round of “substantial discussions and exchanges in an attempt to resolve [the] matter” ensued. A resolution would not come into fruition this time, though, as adidas claims that while they “attempted to negotiate an amicable resolution,” it discovered that Aviator Nation had brought even more allegedly infringing apparel to market, its latest act “in blatant disregard of its obligations under the 2012 settlement agreement.”

 Some of Aviator Nation’s apparel Some of Aviator Nation’s apparel

Without no resolution in sight, adidas filed a 388-page trademark infringement and counterfeiting complaint in federal court in Oregon this week, claiming that despite its “continued attempts[s] to resolve this dispute without the need for litigation even after learning of these flagrant violations,” and even in light of Aviator Nation’s increasingly “egregious infringement and dilution of adidas’ rights,” it has been unable to come to an agreement with Aviator Nation, and ultimately, was forced to seek court intervention.

According to the newly-filed lawsuit, Aviator Nation has “knowingly, willfully, intentionally, and maliciously adopted and is using confusingly similar imitations of [its] three-stripe mark …  on apparel that directly competes with apparel offered for sale by adidas.” This is particularly problematic, adidas argues, given that it has “invested hundreds of millions of dollars [in] building” in connection with its brand.

Such allegedly unauthorized use by Aviator Nation not only stands to confuse consumers as to the source of its apparel, but its “actions are in breach of its obligations under [its] contractual agreement [with adidas], and [are] irreparably harming adidas’s brand and its extremely valuable three-stripe mark.” More than that, adidas asserts that Aviator Nation is “eroding the public’s exclusive identification of this famous mark with adidas, tarnishing and degrading the positive associations and prestigious connotations of this famous mark, and otherwise lessening the capacity of the famous three-stripe mark to identify and distinguish adidas’s goods.”

With that in mind, adidas sets forth claims of trademark infringement and dilution, trademark counterfeiting, unfair competition, unfair and deceptive trade practices, and breach of contract, and is seeking monetary damages in a sum to be determined at trial and injunctive relief in order to bar Aviator Nation from using its three-stripe mark or any confusingly similar marks.

The case is the latest in a growing string of legal actions initiated by adidas in recent years all centering on its valuable three-stripe logo, a trademark that adidas says it began using on apparel as early as 1967 and has used consistently ever since.

A rep for Aviator Nation did not respond to a request for comment.

*The case is adidas America, Inc. et al v. Aviator Nation, Inc., 3:19-cv-02049 (D. Or.).