If you have an Instagram account, you are probably familiar with the repurposed jewelry trend. In my first assignment for my Intellectual Property: Licensing & Drafting class, I chose to focus on a case that profiles this industry. You can read my assignment below:
On February 2, 2021, Chanel filed suit against Shiver and Duke, LLC (“S+D”) for misappropriating its famous interlocking “C” monogram trademark and “Chanel” word mark. Chanel alleged that S+D had taken monogrammed “CC” buttons, meant only for Chanel-authorized clothing, and resold them as repurposed designer accessories. Chanel brings forth claims that S+D’s commercial interest is reliant on Chanel’s “iconic trademark on the jewelry” and use of the CHANEL name to “promote and market” accessories. Chanel alleges that S+D knowingly and willfully took Chanel’s marks, rather than creating their own unique product line. The complaint is brought under Section 32(1) of the Lanham Act, 15 U.S.C. for trademark infringement, unfair competition and trademark dilution. Applying the Lanham Act to the use of repurposed designer buttons and pieces for commercial use could set precedent for reclaimed designer accessories sold in an unauthorized manner. In the last couple years, many major design companies, including Chanel, have settled trademark infringement cases regarding upcycled goods. This case, in particular, is so important because it could be the first case brought to trial in the United States, without an outside settlement agreement. Businesses that repurpose vintage designer materials for profit may have to find new and distinct product lines that do not include federally registered trademarks. Although the case has not yet been decided, Chanel has provided a strong argument for their case and will likely pursued the court to decide in their favor.
Shiver and Duke is an accessory company that sells costume bracelets, chains and earrings, using Chanel buttons as the main charm and attraction; they prominently display and sell under the mark “CHANEL”. The buttons used by S+D were not provided with Chanel’s consent, and may not have been obtained from genuine Chanel products. Chanel provided representative examples of both Chanel’s genuine costume jewelry and S+D’s button jewelry. S+D markets and sells to the same consumer audience as Chanel, through a variety of channels across the United States, including a retail website. S+D has advertised and sold the repurposed accessories as authentic Chanel costume pieces. Chanel provided a printout of S+D’s webpage that displays images of bracelets with the interlocking “C” monogram being promoted as “Designer Chanel Stone Bracelet”. Chanel sent S+D a cease and desist letter, demanding that they halt sales, which S+D did not respond to, they instead made changes to their website to remove Chanel-titled marks.
In May of 2021, S+D produced a memorandum in support of their motion to dismiss for lack of personal jurisdiction or in the alternative, to transfer under forum non-conveniens. The district court denied the motion, because S+D had not shown by clear and convincing evidence that the case should be dismissed or transferred, and therefore the case will move forward in the Southern District of New York. Following the opinion and order denying the motion to dismiss, the court
directed counsel for all parties to appear at an Initial Pretrial Conference on October 18, 2022, in New York, New York. Subsequently, Shiver and Duke filed a motion for extension of time to answer the complaint, which they were granted on September 13, 2022.
American and European courts have given trademark owners the upper hand in brand protection cases. While this may be the first case to set precedent in the U.S., The Court of Justice of the European Union has found that repurposing and reselling designer goods has the ability to undermine the fame of designer brands. In a decision (CJEU C-337/95), the European Court held that trademark owners may oppose the use of their trademark by a reseller when “the use of the trademark for this purpose seriously damages the reputation of the trademark”. Europe’s precedent is similar to the US’s First Sale Doctrine, whose role is now being challenged when it comes to modified and upcycled designer goods. This case raises a fascinating issue that will affect major designer brands and smaller retailers in the upcycle space.
Legally Beau Monde 