Did you know that there was a Supreme Court decision on the Nike AIr Force 1 that impacted why Nike and brands go after sneaker look alikes? Here is what happened (video with some more details on the way).

In 2009 Nike sued Already LLC, who does business as Yums, claiming that Yums’ “Soulja Boys” and “Sugars” sneakers infringed and diluted Nike’s “Air Force 1” trade dress. Yums did what most do and denied the allegations and filed a counterclaim alleging that the Air Force 1 trade dress registration was invalid. 

Months later Nike decided did not want to risk the potential of getting a ruling against the AF1 silhouette’s trade dress and wanted to end the lawsuit they started. Nike made a rather broad agreement with Yums that said they would not sue Yums in the future for trademark infringement or dilution based on any of Yums current sneakers designs or any colorable imitations after. Nike then asked the court to dismiss the case because they settled and there was no longer any “case or controversy” for the court to decide (aka no jurisdiction). The court agreed with Nike and dismissed Nike’s original infringement claims AND Yums counterclaim against the invalidity of the AF1 trade dress. 

Yums did not like that overall decision and wanted the court to rule on the AF1 trade dress so they appealed. The appeals court agreed with the ruling and the case ultimately went all the way to the Supreme Court of the United States of America in 2012. The Supreme Court ruled for Nike in 2013, stating that the broad agreement not to sue Yums made the counterclaim to invalidate the AF1 trade dress moot and there was no issue.

The Supreme Court’s decision here essentially allowed Nike to drop its lawsuit without having to defend counterclaims that challenged their intellectual property rights in the AF1. This decision had a significant impact on intellectual property litigation for Nike and other brands, and highlights the risks associated with commencing infringement actions against other brands. Nike and others have decided that the risks associated with going after brands might not be worth the risk of losing the trademark or trade dress. 

*Remember trademarks can last forever, while patents can only last 14-20 years. The patent for the AF1 ran out (think BAPE).

The case mentioned herein is Already, LLC, dba Yums, v. Nike Inc (January 9, 2013).

Supreme is in hot water over the images it used on the “Blessings Ripstop Shirt” from the S/S 2021 collection it just released. Over the weekend the National Office of Buddhism stated that it will be reaching out to Supreme about the image of Luang Phor Koon surrounded by yant script on Supreme’s jacket. See picture. The images are not registered copyrights in the USA or Thailand, but can still garner protection under Thailand law.

The picture on Supreme’s jacket is a sacred form of tattoo reserved for Buddhist monks and Brahmin. Since the images are not not registered in Thailand or in the USA it will make a lawsuit against the New York skate company a little trickier. Ownership of the image(s) is the main concern. Luang Phor Koon died in 2015, but allegedly gave his permission to print his image on products to raise funds for Wat Ban Rai temple. If the Wat Ban Rai temple can prove that it owns any of these images they will gain rights in the images for 50 years from the date it was created. With those rights it can then file suit against Supreme and VF Corp.

The manager of the Wat Ban Rai temple said that they will discuss the issue with Supreme to find out what the brand’s purpose is, and then decide what action can be taken against the brand.

I had a great conversation last week where we were geeking out over sneaker law discussing Converse’s trademark battle over the look and configuration of the Chuck Taylor sneaker. It made me look up the International Trade Commission’s ruling again for a refresher. The pictures provided in the ITC’s decision are interesting to see but the final ruling actually caused Converse a lot of trouble and led to a 6 year battle over trademark rights in the Chuck Taylor sneaker design.  *Just a note that this decision by the ITC below was overruled on appeal in 2018.

In 2014 Converse thought around 31 overseas manufacturers were importing infringing sneakers that looked like the Chucks into the US market and appealed to the International Trade Commission to try and ban the sneakers from coming in. Converse claimed that the two stripes on the midsole of the Chuck sneaker along with the toe cap, and the rubber toe bumper and the patterns on such were protected aspects of Converse’s registered trademarks and other rights they had in the sneaker, and that other copycat Chuck’s should be banned from being imported. The court had a different view that caused Converse trouble.

In 2016 the ITC agreed with the arguments made by the importers and noted that converse’s claim to the features of the Chuck Taylor design were not able to be protected by the trademark registration. It upheld the validity and enforceability of Converse’s outsole registrations, but invalidated Converse’s alleged trade dress in its upper designs. The ITC noted that the uppers lacked secondary meaning, or that consumers did not recognize the sneakers as only being Chuck Taylor brand sneakers. The ITC noted that it is particularly hard to trademark the configuration of a sneaker/product as a trademark. The sneaker or product configuration must acquire significance over time through use by that specific brand alone. Once it has acquired a “secondary meaning” in the marketplace and when consumers see those aspects of the sneaker they instantly attribute that to Converse Chuck Taylor sneakers, then it can garner trademark protection.

To go along with its decision the Court’s opinion included an appendix with pictures of old school basketball sneaker designs that had very similar features and look to the Chuck Taylors from the early 1900s. 

Maryland just passed the nation’s first tax on the revenue from digital advertisements sold by big technology companies like Facebook, Google and Amazon. The Maryland tax applies to revenue from digital sales the company generates from ads that are displayed inside the state. A company that makes at least $100 million a year in global revenue but no more than $1 billion a year will face a 2.5 percent tax on its ads. Companies that make $15 billion a year  or more will pay a 10 percent tax. Facebook andGoogle’s global revenues far exceed $15 billion. New York tried to pass a similar law last year but could not get it approved. Tech giants have been battling similar bills in each state and will likely challenge this in court. The pandemic has only increased the revenue for tech giants while states are struggling and looking for ways to bring in more money any way they can. Taxing the tech giant’s is the chosen route.

Big win for New Balance and all brands in China around January 5, 2021. Shoutout to @thefashionlaw and @Nicekicks for highlighting the decision and for the great pictures comparing the two brands above. As you can see by the pictures New Barlun is clearly doing exactly what the trademark laws are designed to protect. Other brands and companies cannot use your brands notoriety and success and create a confusingly similar version for them to profit. To me, this is blatantly what was going on here. 

Further, New Balance has been battling and litigating against New Barlun on many levels for almost 20 years now. You might not have heard of them before but they are infamous for copying brands like New Balance in order to gain a following and create a name for them . In 2016 in a separate unfair competition case last year and received a favorable verdict and $1.53 million in damages for copying the “N” design. The blatant disregard for New Balance’s intellectual property and the court rulings means that the continued infringement is intentional and done on purpose. It was great to see the court agree and mention that in this ruling and issue a nice big verdict against them. 

The $3.85 million verdict was one of the largest trademark infringement decisions in China for sneakers to date. The Chinese IP and trademark system are complex and very different from the United States. It can be difficult to even find these infringing companies, not to mention getting them in court. When you do, the damages have not been large enough to actually be a real deterrent in my opinion. The large ruling from January is a positive sign that the legal system in China is respecting trademarks and brands intellectual property more than they have before. It certainly doesn’t mean copycat brands wont exist, but it could help to deter some.

Another important and relevant thing to note from the long trademark battle between New Balance and New Barlun is that the Shanghai Huangpu District Court also found New Barlun’s distributor, Shanghai Lusha Fashion Co., guilty of infringement too. The distributor was ordered to pay only $15,000 in damages but they were deemed liable for infringing New Balance’s trademark and IP rights and it’s good to see this precedent. I would like to see the damages a little higher but it’s a start. This is an important decision for brands protecting their IP rights in China. It is also important to note because a similar case is on the dockets in California courts between Nike and La La Land related to manufacturers and distributors liability.

On that note, La La Land was due to submit their answer to the court yesterday on February 11 but was granted an extension until March 4 to respond. To date, they have still denied all the charges against them despite Nike having invoices that La La Land sent to Warren Lotas for millions from several releases. It will be interesting to see this defense strategy.

On Feb. 6, 2018, Mascotte Holdings, Inc., one of Kanye West’s companies, filed trademark applications with the USPTO to register the marks for “RED OCTOBER” and “RED OCTOBERS.” The applications are filed in class 25, which covers footwear, pants, shirts, etc. However, these applications looked slightly different because the goods and services listed in class 25 here are extremely broad and covered almost everything possible in class 25. From sneakers and T-shirts, to G-strings, ear muffs, snow suits, and capes. This was done on purpose to reserve the trademark in as many possible goods in that class before they narrow it down by actually using the mark, but most importantly it prevents others from doing the same. 

The applications were also filed on an ‘intent to use’ basis. Meaning, that Kanye and his team are claiming that they have not used the marks in commerce as of the date filed, and will have to show evidence that they have used the trademarks commercially at some point in the future before the USPTO can approve and register the two marks. This seemed a little weird to me at first because I know that Nike and Kanye released the Nike Air Yeezy II “Red Octobers” in 2014. However, when you think about it legally it makes more sense. Kanye listed his own company as the owner on the two applications here so he could have exclusive ownership rights to these trademarks, not Nike or Adidas. Filing a new application stating that the goods with these marks on them have not been used yet distances himself and this trademark application from the 2013 Nike Yeezy release and makes a better case for his exclusive ownership if Nike tried to make any claim to ownership or file an opposition to these applications. Exclusive ownership of the ‘RED OCTOBER’ mark is obviously beneficial to Kanye and his company.

Despite the above, the question many were asking at the time of this filing in 2018 was whether Nike would allow Kanye to register this trademark so he can use it with Adidas or another company or if they would file a motion to oppose this registration. Well, the trademark process came and went and Nike did NOT file a motion to oppose either of these trademark. The USPTO issued a Notice of Allowance for both marks on Feb. 26, 2019. Now, the only thing left to do by Kanye and his team is to actually use the ‘RED OCTOBER(S)’ trademarks commercially on the items listed in class 25 above. The USPTO gives you six months after the NOA to use the mark, but you are allowed to pay a fee and request an extension of time for another six months if you cannot show use. You can request a maximum of five extensions total. So, you could have another 36 months to actually use the trademark in commerce, while keeping your original filing date from more than three years earlier.

Brands do this and file early before using the trademark so that they can get an earlier filing date and essentially mark their territory over a specific trademark before others can. This first use date can be very important in the event a conflict develops with another mark. Simply put, Trademark registration in the US is based on first to use the trademark. There are two ways to qualify as a first user of a trademark; 1) Actual use of the trademark on a product that is distributed in the marketplace ( or first use of a mark in connection with advertising and marketing if it is a service mark); or 2) Intent to use the trademark at a later time. In the later, the applicant files the mark first before it is used by another party, and puts the mark into actual use at another time.

The advantage of filing an intent-to-use application (option 2 above) is that your filing date will serve as the date of your first use of the mark— assuming you actually use the mark and take the other steps necessary to register the mark. This first use date can be very important in the event a conflict develops with another mark. If you filed your intent to use trademark application before another party began to use a conflicting trademark, you’ll get priority in registration over the conflicting trademark should there be a dispute. This approach allows you to reserve a trademark before you’re ready to launch your product, service, business or whatever uses the mark. 

As of today, Kanye and his team are on extension request #3. The Feb. 26, 2021, deadline to file extension #4 is right around the corner. I haven’t heard about anything with the “RED OCTOBER” mark coming out this month so it’s likely that an extension will be filed and only one more remain. That means that within the next year we will see something from Kanye and his team, or the trademark will be abandoned.