Karen Millen loses right to trade under her name

18-08-2016

Karen Millen loses right to trade under her name

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UK fashion designer Karen Millen has lost the right to trade under her name following a judgment at the English High Court.

In a ruling handed down on Tuesday, August 16, the High Court ruled that Karen Millen Fashions, which is now owned by an Icelandic consortium, owns the rights to the name and confusingly similar variations.

Karen Millen founded her business, a women’s clothing stall, in 1983 with her partner Kevin Stanford. They opened a chain of shops that traded under the name Karen Millen.

In 2004, Millen agreed a share purchase agreement (SPA) with an Icelandic consortium.

The consortium was funded by Icelandic bank Kaupthing and led by the investment group Baugur, the owner of fashion conglomerate Mosaic Fashions, which would go on to buy Karen Millen later that year.

The SPA contains a number of covenants related to Karen Millen’s (the person) future conduct including clause 5.1.7, which states that Millen is not permitted to use the name ‘Karen Millen’, ‘KM’ and ‘K Millen’ or any other confusingly similar name in the US and China.

In 2011, Millen said that she wanted to return to the fashion business under the name ‘Karen’ to sell homeware and accessories.

She added that another clause, 5.1.4, could not apply to registered trademarks, applications, or rights to apply for registered trademarks obtained after the SPA, and that the clause had to be assessed against the backdrop of the Karen Millen brand in 2004, when it had more limited goodwill. 

This led to litigation about her intentions in the UK and Europe. A lawsuit was filed by Millen in 2011 but the case settled in 2015. However, the ruling did not address the position in the US and China.

The current suit, which specifically addresses the position in the US and China, was brought in October 2014. It concerns the trademarks ‘Karen’, ‘Karen Millen’ and ‘KM’.

Handing down the ruling, Richard Meade QC said: “I am not sorry to reach this conclusion.”

He added: “In general, the claimant has acted responsibly (although largely unsuccessfully) in seeking a decision as to the parties’ rights before she begins trading.

“But blocking the defendants from registrations for the very mark the rights in which were, in substance, bought under the SPA has been petty, and escalated the complexity of the worldwide dispute unnecessarily.”

Karen Millen, Baugur, trademark, trademark application, SPA agreement, Karen Millen Fashions, Mosaic Fashions,

WIPR