タグ: Unfair Competition Prevention Law

Hermes Wins Birkin & Kelly Bag’s 3D Trademark Infringement Lawsuit

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On March 9, 2023, the Tokyo District Court awarded HERMES INTERNATIONAL JPY5,640,112 for infringement of its trademark right pertinent to the 3D shape of the Birkin bag and Kelly bag.

[Judicial case no. Tokyo District Court – Reiwa3(wa)22287]

3D mark of Hermès Birkin and Kelly Bag

HERMES INTERNATIONAL, a French luxury fashion house, has owned Japanese trademark registration no. 5438059 for the 3D shape of the “Birkin” bag and no. 5438058 for the “Kelly” bag in connection with handbags (class 25) since 2011 by successfully demonstrating acquired secondary meaning as a specific source indicator of Hermès’ luxury bags.

Birkin and Kelly Bag Imitations

Hermes sued NAO INTERNATIONAL Co., Ltd. at the Tokyo District Court for violating its trademark right and the unfair competition prevention law by allegedly selling 214 Birkin look-alike bags and 184 Kelly look-alike bags in Japan with a price tag of JPY2,270 (approx. USD20) at their brick-and-mortal shops and online shop from December 20, 2019, to February 13, 2021.

Court decision

The Tokyo District Court found that the defendant’s bags respectively resemble 3D marks representing Hermès Birkin and Kelly Bag in an appearance on the ground that the defendant’s bags contain a basic and unique configuration enabling to distinguish Hermès Birkin and Kelly Bag from others. A difference in details is trivial and would not give rise to a distinctive impression in the mind of consumers.

Taking into consideration the fact that both bags are promoted for sale at the department store, the court has a reason to believe relevant consumers are likely to confuse the source of the defendant’s bags with Hermes.

Even though there is a severe price gap between the Hermes bag and the defendant bag, bearing in mind that authentic second-hand Hermès handbags are sold relatively at low prices, such a price gap would be anything but sufficient to negate the likelihood of confusion.

The court measured damages to recover (i) the defendant’s actual profits of infringing bags (JPY5,150,140) by reducing 20% (not attributable to goodwill on Hermès bags) for JPY4,120,112, (ii) “mental suffering” caused by an infringement for JPY1,000,000, and (iii) reasonable attorney fee for JPY520,000.

To read a full text of the Tokyo District Court decision (Japanese only), click here.

Louboutin 2nd Defeat in Litigation over Red Soles

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By order of December 26, 2022, the IP High Court ruled to dismiss an appeal taken by Louboutin against the Tokyo District Court ruling that denied a source-indicating function of Louboutin’s red soles.

[Appeal court case no. Reiwa4(ne)10051]

Appellant, Christian Louboutin SAS, brought an appeal against the Tokyo District Court ruling decided on March 11, 2022.

In May 2019, Louboutin sued Eizo Collection Co., Ltd., a Japanese company that produced ladies’ shoes with red-colored rubber soles, and sought a permanent injunction as well as damages in the amount of JPY4,208,000 under the Unfair Competition Prevention Law. The Tokyo District Court did not side with Louboutin by finding an insufficient reputation of Louboutin’s red soles perse as a source indicator and thus unlikelihood of confusion.
See details here.

The IP High Court paid attention to the following factors to assess the likelihood of confusion in the case.

  1. Relevant consumers of high-heels (women from their 20s to 50s) are most likely to try on multiple pairs of shoes at a physical store and select the ones that fit them prior to the purchase.
  2. The market for women’s high heels can be divided into three categories: (1) luxury brand products, (2) affordable brand products, and (3) inexpensive no-name products. Undoubtedly, Louboutin’s high-heels priced at JPY80,000 and over are classified into category (1). In the meantime, Eizo’s shoes priced at JPY17,000 or less belong to category (2).
  3. Every high-heel bears a brand name or logo on the insole so that consumers can easily distinguish its supplier.
  4. E-commerce websites post not only images of ladies’ shoes but also the brand and condition of respective goods in advertisements.

Based on the foregoing, the judge found, irrespective of the resemblance in color on the outsole, no likelihood of confusion between both shoes.

As for the reputation of Louboutin’s red soles, the IP High Court admitted certain consumers may recognize the red soles as a source indicator of Louboutin, however, the judge questioned if the soles have acquired a remarkable reputation among relevant consumers in general based on the research targeted women, in their 20s to 50s accustomed to wearing high-heels, residing in major cities that revealed only 51.6 % of the interviewees answered Louboutin at the sight of a high-heel with red-colored sole and a fact that Louboutin has not been an exclusive supplier of red sole shoes for women.

Louboutin Unsuccessful in Litigation over Red Soles

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On March 11, 2022, the Tokyo District Court dismissed allegations by Christian Louboutin who claimed red-soled shoes distributed by the defendant infringe their intellectual property right and are liable for damages under the Unfair Competition Prevention Law.

[Judicial case no. H31(Wa)11108]

Louboutin’s red soles

Christian Louboutin SAS alleged heels and pumps with red-lacquered leather soles (Pantone 18-1663) perse (see below) have been famous as a source indicator of Louboutin shoes as a result of substantial use for more than two decades in Japan.

To demonstrate the remarkable reputation of the position mark with a single color, Louboutin produced a lot of evidence. Japanese subsidiary generated sales of JPY3,305 million for Ladies’ shoes in 2016. More than 70% of the shoes are heels and pumps with red-colored soles. The company has yearly spent JPY15 million and more on advertisements in Japan. According to the interview conducted in October 2020, 65% of the 3,149 interviewees (females aging from 20 to 50) answered Louboutin when shown the above image.

Disputed goods

Allegedly, Eizo Collection Co., Ltd., a Japanese business entity, began to distribute ladies’ shoes with red-colored rubber soles bearing the wordmark “EIZO” for JPY17,000 from May 2018 (see below).

In the litigation, Louboutin sought a permanent injunction, disposal of the disputed shoes, and damages in the amount of JPY4,208,000.

It should note that Louboutin’s attempt to register the position mark representing ladies’ heels with red-colored soles in 2015 has been pending by the Japan Patent Office due to a lack of inherent and acquired distinctiveness as of now.

Court decision

The Tokyo District Court denied a certain degree of reputation and popularity of the red soles to indicate Louboutin shoes by stating:

  1. Red color has been commonly used on shoes to enhance the aesthetic appearance and attract consumers. Ladies’ heels with red-colored soles have been widely distributed even before the launch of Louboutin shoes in Japan.
  2. Under the practice in commerce, two decades and advertisement would be insufficient to find Louboutin’s red soles have played a role in the source indicator in Japan.

Besides, the court found the unlikelihood of confusion between Louboutin and the defendant’s shoes on the grounds that:

  • Given Louboutin’s shoes are known for high-end heels that cost JPY80,000 and more, relevant consumers would pay attention to selecting and purchasing suitable goods. Being that Louboutin’s shoes has the stylized mark “Louboutin” on soles as well, it is unlikely that relevant consumers connect the defendant’s shoes bearing the wordmark “EIZO” on soles with Louboutin.
  • Because of the difference in respective materials on soles (lacquered leather for Louboutin, and rubber for defendant shoes), there exists a distinction in texture and luster to the extent that relevant consumers can easily distinguish the quality and source of respective goods.
  • The interview targeted consumers who have purchased high-end goods and famous brands. Since the interview failed to show the defendant’s shoes to the interviewees, it would be irrelevant to prove a likelihood of confusion between the shoes.

Based on the foregoing, the court dismissed the plaintiff’s allegations under the Unfair Competition Prevention Law and did not side with Louboutin.