The luxury of fashion law
This increased interest has caused the fashion industry to face challenges that were not common in past decades. Fashion law has become a brand new legal specialty that involves several issues of IP rights—particularly trademark law and copyright law, although it can also include patents and trade secrets. Patent and trade secrets become relevant when the fashion company has developed a new manufacturing process or method. For example, Lululemon® and its design patent on women’s yoga pants waistbands. The Canadian company that made yoga apparel fashionable filed a patent lawsuit in 2012 against Calvin Klein and its supplier G-III Apparel Group for direct and indirect wilful infringement of the company’s yoga pant design patents. The case was brought before the US District Court for the District of Delaware and was voluntarily dismissed a few months later, based on a settlement between the parties.
Fashion design ideas commonly involve protecting the designer’s brand or identity and the designs themselves. To that end, the designer’s brand or identity is usually protected with the application of trademark law. It is well known that a trademark is one of the most valuable assets of a company, and in the fashion industry a well-situated campaign or the latest trend of a top fashion house could have a big economic impact. The target market of fashion law is large retail chains, high fashion houses, models, designers, manufacturers, photographers and others.
They must have adequate protection under national legislation in order to promote the growth of the industry and the creativity of designers.
Additionally, it involves other legal practices such as corporate law, employment law and other areas such as the supply chain of goods, marketing strategies and public relations. The aim of fashion law is to provide legal advice to these customers and assist them in the enforcement of IP rights and the other side of the business such as corporate affairs and public relations.
One of the major issues that the fashion industry faces is the damage caused by the counterfeiting of goods and unfair competition. As of today, the most vulnerable goods are apparel: clothes, accessories and shoes. Counterfeit products have a competitive edge—they do not have the overheads of the legitimate products and are competitively priced, while remaining vastly more profitable, to the extent that, in some parts of the world, counterfeit products are far more common than originals.
Despite the fact that many people are aware that the loss of income reduces the incentives for creativity, the impact seems too distant and the victims too affluent for many people to give the matter a second thought. Although a counterfeited purse or pair of shoes may perhaps seem inconsequential for the vast majority of people, it is certain that such goods bear the name and reputation of a company, and consequently, they must have adequate protection under national legislation in order to promote the growth of the industry and the creativity of designers.
Counterfeiting is commonly reduced to a revenue issue, but the damage is not felt just by fashion designer right holders. The government loses tax revenue and incurs enforcement expenses. Sales taxes are avoided since counterfeits are generally sold irregularly. Also, fashion designers that lose revenue as a consequence of competition from counterfeiters pay less in taxes.
Due to IP protection and enforcement efforts, governments incur costs. It has been found that organised criminal and terrorist organisations are involved in counterfeiting and piracy.
The strategic management of IP rights will allow a fashion designer or company to effectively protect and promote its ideas, relationships, and talent. This, in turn, will enable fashion designers to enter or expand in the market, obtain a bigger market share and improve profitability. Fashion attorneys must be capable of understanding the unique elements of the fashion industry and to feel passionate about that gleaming world.
María del Pilar López is the partner responsible for overseeing the firm’s IP matters. She can be contacted at: plopez@zurcherip.com
Esteban Monge is an attorney at the IP practice of Zürcher Lawyers. He can be contacted at: emonge@zurcherip.com
