I initially wrote this post for Fordham's Intellectual Property, Media & Entertainment Law Journal. You can find the original publication here.
A cease-and-desist letter is a strategic device often used by major fashion houses as a form of protection of their trademarks and copyrights. Its purpose is to alert alleged infringers that they are using a brand’s trademark or copyright without authorization. Companies will often use cease and desist letters as an opportunity to confront acts of infringement prior to, or in lieu of, litigation. The letter will often request that the infringer “cease” and “desist” the infringing acts, but these letters should not be sent without careful consideration. While they can be effective in regulating intellectual property protection, a strongly-worded letter, or one to a litigious entity, could be met with a response in the form of a declaratory action seeking to invalidate one’s intellectual property; and that is exactly where Gucci found itself this summer.
Forever 21, Inc. (“Forever 21”) sold items bearing blue-red-blue and green-red-green stripes (the “striped marks”) for which Gucci America, Inc. (“Gucci”) owns several trademarks for different categories of goods. Gucci sent three unsuccessful cease and desist letters to Forever 21 alleging Forever 21 was infringing on its striped marks in categories including clothing and certain jewelry. Gucci’s third and final letter, dated February 13, 2017, demanded that Forever 21 “immediately ceas[e] any and all manufacture, importation, offering for sale, sale, shipment, advertising or display of the Striped Products . . . that are “confusingly similar” to Gucci’s blue-red-blue and green-red-green stripe marks.” The letter also requested that Forever 21 provide an accounting of all striped products sold and inventoried, as well as the identity and contact information for the persons or entities that designed, manufactured, and or distributed the Striped Products. In that same letter, Gucci also threated to file an action against Forever 21.
A lawsuit was in fact filed on June 26, 2017 in the United States District Court for the Central District of California, only it was filed by Forever 21 seeking: (1) declaratory judgment that Forever 21 was not infringing on Gucci’s trademarks; (2) cancellation of Gucci’s striped trademarks; and (3) denial of Gucci’s pending striped trademarks for additional categories of goods. In its complaint, Forever 21 alleged that consumers were not likely to be confused into believing the products sold at Forever 21’s stores were manufactured or otherwise authorized by Gucci. Forever 21 further claimed that Gucci’s striped trademarks lacked secondary meaning, were for aesthetic functionality, and were the products of genericism, and thereby required denial of its federal registration.
In response, Gucci filed a motion to dismiss stating that Forever 21 had failed to allege sufficient facts to support its claim for cancellation or denial of its trademarks. Gucci noted that “[a] complaint without even a single factual allegation addressed to the particular trademarks at issue, and that fails to identify the alleged third-party users or describe their allegedly similar products, must, on its face, be dismissed.” Gucci’s motion also argued that Forever 21 lacked standing to even seek cancellation of many of Gucci’s trademarks, because Gucci’s cease and desist letter only accused Forever 21 of infringement in the categories of clothing and jewelry, and not in the additional five categories Forever 21’s complaint sought to cancel. Finally, Gucci argued to the court that it did not have power to cancel a pending trademark application. On November 6, 2017, the court granted Gucci’s motion while granting Forever 21 the leave to amend its complaint to plead sufficient facts to support its claim of cancellation for lack of secondary meaning, aesthetic functionality, and genericism, as well as its claim for denial of Gucci’s pending trademark registrations.
On November 17, 2017, Forever 21 timely filed its amended complaint, hoping to cure the defects of its original complaint. In support of its claim for cancellation for lack of secondary meaning, aesthetic functionality, and genericism, Forever 21 attached 126 examples of items ranging from clothing, shoes, belts, hats, and other goods bearing either blue-red-blue or green-red-green stripes. Among the companies that Forever 21 points out as using Gucci’s striped marks were Louis Vuitton, Versace, Adidas, Tory Burch, J. Crew, and Gap. Acknowledging the District Court’s concern for its ability to deny pending registrations, Forever 21 cited Forschner Group v. B-Line A.G. as support for its belief that the court may ultimately determine Gucci’s right to register the mark in the additional categories.
For some, it may be surprising to learn that Forever 21 filed its amended complaint to maintain its action against Gucci for its striped marks. Aside from including significant amounts of photos of products with similar-colored stripes as Gucci’s striped marks, Forever 21 does little to build on its cancellation claims and how Gucci’s striped marks have not acquired secondary meaning or have been the victim of genericide. As such, it will be interesting to watch this case unfold as it serves as fair warning for what can happen when sending a cease and desist letter (or three).