Opportunity for Yves Saint Laurent To Go On Offensive

A previous article by CanadaFashionLaw discussed the pending trade-mark infringement case in the US between Christian Louboutin and Yves Saint Laurent.

To quickly recap, Christian Louboutin, a luxury brand notorious for its shoes that have red soles on the exterior of shoes, is suing Yves Saint Laurent in New York for trade-mark infringement, based upon Yves Saint Laurent inclusion of red shoes with red soles in a fashion show earlier this year.  At the time the action was commenced, Christian Louboutin was the owner of a registered trade-mark in the US for the red soles, however, trade-mark applications were still pending in Canada and Europe.



Interestingly, Christian Louboutin's trade-mark application has progressed in Canada to the advertisement stage, which signifies the start of the opposition period. 

This is significant as it may provide an opportunity for
Yves Saint Laurent to go on the offensive and attack the registrability
of Christian Louboutin's trade-mark.

In Canada, in order for a trade-mark to register, the trade-mark application is subjected to a rigorous and lengthy process.  At first, the trade-mark is filed with the Canadian Trade-marks Office.  The trade-mark application is examined by the Canadian Trade-marks Office for substantive and administrative issues.  Substantive objections may be raised at this point, for example the trade-mark may be "clearly descriptive or deceptively misdescriptive", the trade-mark is confusingly similar and therefore conflicts with a previously registered third party trade-mark etc.  Once (or if) the trade-mark application moves beyond the examination stage, the application is then advertised in the Canadian Trade-marks Journal.  This signifies the start of the opposition period. 

The opposition period places the onus on other brand owners to protect their own brand as it affords "any interested party" the opportunity to police third party trade-marks that may register in Canada.  If a brand owner wishes to contest the registrability of the trade-mark, it may oppose the trade-mark application.  An opposition is essentially a tribunal that has been set up within the trade-mark registration process.  It is akin to court in that pleadings are submitted, evidence is compiled, arguments are put forth.  There is also an opportunity for cross-examinations and oral hearings.  The Trade-marks Opposition Board determines whether the trade-mark application is registrable or not.  It can pose a significant obstacle to the trade-mark applicant. 

There a number of possible grounds of opposition identified in the Trade-marks Act.  Yves Saint Laurent may be most interested in the following:

a) the trade-mark is not registrable; and/or

b) the trade-mark is not distinctive.

If Yves Saint Laurent wishes to act, it must do quickly.  A statement of opposition must be filed with the Canadian Trade-marks Opposition Board within two months of the date of advertisement of the trade-mark application.  (However, there is always the possibility of requesting a limited extension of time). 

It will be interesting to see whether anything will materialize or is Christian Louboutin's exclusivity over its red soles will be statutorily recognized in Canada.

Below is a summary of Christian Louboutin's Canadian trade-mark application:


Trademark App. No. & DateWaresDescription
 red sole medium
1,469,797
February 17, 2010
Footwear namely shoes, ballet flats, boots, ankle boots, thigh boots, pumps, sandals, sneakers, clogsThe trade-mark consists of the colour red applied to the entire outer surface of the sole, as shown in the drawing.

Crunching Numbers on Ontario's Fashion Industry

On today, which is Canada Day, let's reflect on the Canadian fashion industry.  Or, more importantly, what does it mean to Canada's purse strings? 

The Ontario government released a report that looks at the economic contributions of the fashion industry to Ontario's economy.  Here's a quick look:

- Toronto's fashion industry employs more than 50,000. 

- Fashion designers generally live where they work: a survey indicates that 73% live in Toronto.

- Toronto is home to 550 apparel manufacturers that bring in $1.4 billion annually.

- Shopping opportunties abound in Toronto.  There are 4,600 retail stores in Toronto, which generate $2.6 billion in revenue.

- Toronto's LG Fashion Week draws crowds.  Almost 35,000 people attended the fashion week that debuted Fall 2011 fashion lines.  Given that the LG Fashion Week occurs twice annually, that's a lot of tourism.

- A survey indicates that Canada's fashion industry will need to hire 7,000 more people over the next 2 years.

Makes you proud to be a Canadian, eh? 

Sting Like a Bee: Federal Court Awards $2.5 million for Trade-mark and Copyright Infringement

On June 27, 2011, Canada’s Federal Court issued the largest anti-counterfeiting damages award for trade-mark and copyright infringement $2.5 million, in Louis Vuitton Malletier S.A. et al. v. Singga Enterprises (Canada) Inc.


The Players 

Louis Vuitton Malletier S.A. and Burberry Limited, the intellectual property owners and only authorized manufacturers and distributors of Louis Vuitton and Burberry products, respectively, along with their exclusive Canadian distributors, Louis Vuitton Canada, Inc. and Burberry Canada Inc., combined forces to launch a suit for trade-mark and copyright infringement.

The defendants are a mélange of corporations and individuals whose illegal activities were interwoven throughout Canada.  Singga Enterprises (Canada) Ltd., along with the officer and director and principal, operated a warehousing, importation distribution and online business that imported, sold and distributed counterfeit goods from Burnaby, B.C. 

Altec Productions, along with its directing minds, operates out of Markham, Ontario.  Singga referred customers interested in bulk purchase to Altec for a commission. 

Carnation Fashion Company, along with its owner, also operates out of Burnaby, B.C.  Although no direct connection was found between Carnation and the remaining defendants, Carnation operated a warehouse that was located directly behind Singga.


The Sting

Louis Vuitton and Burberry became aware that from at least as early as January 2008 that Singga manufactured, imported, advertised and sold counterfeit products throughout Canada on a large scale.  The plaintiffs hired a private investigator who posed as as interested bulk buyer.  Compiled evidence indicated that the defendants imported the counterfeit products from China and warehoused them throughout Canada (Vancouver, Edmonton, Toronto and Halifax).  The defendants preferred to deal in bulk orders and also made the products available for sale online.  On several occasions the defendants acknowledged that the products were counterfeit.  The defendants even offered up services to custom-make counterfeit goods, as long as a photograph of the original product was provided. 


The Decision

Without a doubt, the evidence demonstrated that the defendants knowingly infringed the plaintiffs’ intellectual property rights.  The defendants’ sale of substantially inferior quality products caused irreparable harm and damage to the plaintiffs’ goodwill and reputation. 

The plaintiffs were awarded injunctive relief, delivery up, damages for both trade-mark and copyright infringement, statutory damages, punitive and exemplary damages and costs on a solicitor and client basis via a summary trial. 

The court found that the individual defendants were culpable and could not use their respective corporations as a shield from liability.  There were individually fined, in addition to their companies. 

All in all, cumulatively the defendants were ordered to pay $2.5 million to the plaintiffs. 


How Did it Reach $2.5 Million?

Allocating damages awards in anti-counterfeiting cases is challenging because of the unknowns: 

How can you quantify the depreciation of goodwill? 

Do the diverted profits to the counterfeiters actually reflect lost profits for the brand owner? 

Is it likely that the plaintiffs and the defendants would have the same consumers? 

Is it possible to obtain evidentiary documentation that supports all of the anti-counterfeiting activities, sales and profits? 

Bottom line: accurate quantification of damages in anti-counterfeiting cases is difficult. 

In 1997 the Federal Court devised a scale of quantification that could be applied in determining damages awards in anti-counterfeiting cases to overcome the quantification hurdles: $3,000 for flea markets, $6,000 for retail stores and $24,000 for manufacturers/distributors for each single count of infringement.  Recently the court has adjusted these amounts to account for inflation. 

In this instance, the court recognized that the infringement was on a large scale, was well-orchestrated, continued over a long period of time and involved the importation of counterfeit goods from China.  The court determined that the damages needed to be considered at a high level.  Moreover, damages should be awarded to each plaintiff individually. 

The court held that damages should be assessed at the importer/distributor level and, accounting for inflation in 2009, an award of $30,384.11 should be granted per each trade-mark infringing activity to each of the four plaintiffs. 

The court determined that the defendants’ conduct demonstrated that they were dismissive of the rule of law and clearly could benefit from deterrence, which is the goal of awarding statutory damages.  As such, the court also awarded statutory damages for copyright infringement at the highest end of the scale for each instance: $20,000.  

Deeming the defendants’ conduct egregious, outrageous, reprehensible, the court did not shy away from awarding punitive and exemplary damages.

Solicitor and client costs were also awarded. 

Osgoode Hall Law School Takes Note of CanadaFashionLaw

I continue to be amazed and flattered by the support within both the legal and fashion community that CanadaFashionLaw is receiving. 

Osgoode Hall Law School, a top tier Canadian law school, sets itself apart in the intellectual property community with its creation of IPOsgoode, an intellectual property law and technology program.  IPOsgoode "cultivates interdisciplinary, comparative and transnational research, collaboration, policy-thinking and practice". 

CanadaFashionLaw.com was recently featured on IPOsgoode.  Below is the excerpt: 

by Andrew Baker

Ashlee Froese, Osgoode Hall Law School alum of 2006 and IPilogue contributor, has launched CanadaFashionLaw, which has garnered immediate attention from both the fashion industry and the legal community, receiving over 500 unique hits in its first three days.

CanadaFashionLaw covers the business and legal issues surrounding the fashion industry by not only exploring contemporary legal issues, but also by providing commentary on the existing policy framework of intellectual property within the fashion industry.

In her third post, Froese explains how Canada’s poor performance in the The Office of the United States Trade Representative’s 2011 National Trade Estimate Report on Foreign Trade Barriers presents obstacles for the Canadian fashion industry with regards to US willingness to trade.  She goes on to explain that other countries, such as France and Italy, have specifically drafted domestic intellectual property laws for fashion design, which provide greater legal clarity.  The US is also considering specific protections for the fashion industry as it reforms its copyright law.

CanadaFashionLaw has also covered two interesting cases in Canada and the US, respectively.  Froese has reviewed the recent Supreme Court of Canada trademark case, Masterpiece Inc v Alavida Lifestyles Inc. 2011 SCC 27, explaining that the decision demonstrates the usefulness of conducting trade-mark availability searches (the Masterpiece case was also reported on by co-counsel for Masterpiece in the IPilogue).  The blog is also following a pending suit by Christian Louboutin against Yves Saint Laurent for allegedly copying its distinctive red-soled shoe design trade-marked in 2008.

Already, CanadaFashionLaw has caught the attention of the legal community with NY State Attorney, Vincent Lotempio, recently interviewing Froese on his blog.  The interview discusses fashion industry-specific policy solutions within the framework of trade-mark law thereby highlighting many of the unique and interesting problems arising at the intersection of fashion and law.

Guide to Canada's Fashion Weeks

Think fashion only happens south of the border?  You would be wrong.  Here's a quick reference guide to Canada's various fashion weeks:

LG Fashion Week
Dates: March 28 to April 1, 2011; October 17 to 22, 2011
Location: Toronto
Overview: This is Canada's biggest fashion week.  In its 12th year, LG Fashion Week brings together media, industry, consumers and buyers.


Rogue Fashion Week
Dates: Simultaneous to LG Fashion Week
Location: Toronto
Overview: Not satisfied with staying within the confines of LG Fashion Week, Rogue Fashion Week sees designers take matters into their own hands.

Toronto Alternative Arts and Fashion Week
Dates: April 26 to 29, 2011
Location: Toronto
Overview: This fashion week looks at emphasizing the interplay of fashion with arts, photography and music. 


Frugal Fashion Week
Dates: July 21 to 24, 2011
Location: Toronto
Overview: This charitable initiative seeks to profile and support local retail and design communities.


Montreal Fashion Week
Dates: February 7 to 10, 2011; September 6 to 9, 2011
Location: Montreal
Overview: Ce défilé de mode est probablement le plus grand compétiteur de LG Fashion Week.


Vancouver Fashion Week
Dates: April 12 to 17, 2011
Location: Vancouver
Overview: Reflecting Vancouver's international flare, west-coast based designers share the spotlight with foreign designers from Korea, China and India, for example.


Western Canada Fashion Week
Dates: March 24 to 31, 2011; September 22 to 29, 2011
Location: Edmonton
Overview: This fashion week celebrates the fusion of art, design and musical culture for a unique collaboration of the creative minds.


Atlantic Fashion Week
Dates: June 13 to 19, 2011
Location: Halifax
Overview: Entering into its 5th season, this fashion week is determined to let the rest of Canada and the world know what the eastern provinces are made of.


Eco Fashion Week
Dates: February 22 to 25, 2011
Location: Vancouver
Overview: This green machine celebrates environmental sustainability and eco-friendly industry practices.


Ottawa Fashion Week
Dates: March 18 to 20, 2011
Location: Ottawa
Overview: This fashion week looks at talent in the nation's capital.


Alberta Fashion Week
Dates: May 19 to 21, 2011
Location: Alberta
Overview: This fashion week highlights fashion designers from throughout Canada.