Fashion, Intellectual Property

IP Perils Of The Almost Famous

Smaller brands often struggle with how to protect their first commercially successful product from an IP perspective.

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M2Malletier’s classic Fabricca bag (photo by M2Malletier via Fashionista)

Anyone who has entered a high-end department store or luxury brand boutique is quickly confronted with the reality that handbags are a big business. Prime selling real estate is occupied by an ever-rotating mix of classic and trendy handbag styles, all of which bear prices that tend to remind older folks of what their first new car cost. Price aside — or perhaps because of the price itself — there is no doubt that handbag purveyors enjoy healthy profits on their wares, and that handbags are staple items of commerce for the world’s leading luxury and near-luxury brands. But where there is profit there is also a willingness to copy, and it is not surprising that handbag disputes are a reliable source of work for IP lawyers as well as fodder for the fashion and IP media.

While handbags are important for established brands as visible and portable sources of advertising (subsidized by customers more than happy to serve as walking billboards), it is also true that designing a hit handbag can be a career-launching milestone for a new-to-the-scene designer or design team. Unlike larger brands that have the wherewithal and legal resources to police infringers, however, smaller brands often struggle with how to protect their first commercially successful product from an IP perspective.

On the one hand, these smaller players face the same time of counterfeiting risk that the larger brands do, with blatant knock-off artists able to flood the market with cheaper alternatives seemingly overnight. While there may be some comfort (and a hint of feeling flattered) for a small brand to know that their products are worthy of being knocked off just like those of the bigger fashion houses, there is also another layer of risk that smaller players can be forced to encounter — that a larger player will also try to copy some of their design elements as well. This not-uncommon behavior can be a source of great frustration to an up-and-coming company, and while complaining about things in an impotent rage can be cathartic, a more reasoned response is often necessary — with the outside IP lawyer usually tasked to help manage the process.

A good recent illustration of this dynamic is found in the story of M2Malletier’s ongoing dispute with the well-known fashion house Carolina Herrera. M2Malletier is a Barcelona-based seller of various handbags, which has received much acclaim and celebrity patronage for its expensive wares. Understanding the importance of IP protection, the company trademarked one of the signature elements of its bags, its linear bar or “needle” bag handle.

Perhaps in the spirit of healthy competition, but surely with an eye towards the commercial popularity of luxury handbags containing metal handles, Carolina Herrera recently launched an Insignia Bag with a variation on a linear bar handle. Arguing that colleagues and customers have already indicated that they are confused about the source of the Carolina Herrera bag (the whole point of trademark law), the M2Malletier crew commissioned a cease-and-desist letter to Carolina Herrera. From the looks of things, the parties agreed to disagree about the validity of M2Malletier’s claims, and have retreated to their separate corners until the next step is taken by one or the other.

Making the dispute more interesting, and perhaps providing an indication of how a smaller brand can fight back against counterfeiters big and small in the court of public opinion, the owners of M2Malletier have also taken their cause to social media. For example, an Instagram post saw the company “deeply shocked” at Carolina Herrera’s “unfair advantage” of the brand’s “signature handle.” Cue the chorus of sympathetic exclamations (in various languages no less), by fans of M2Malletier. As a piece of marketing, using social media to complain about being knocked off is a solid strategy. It can be a springboard to additional free media attention to the company’s plight, while reinforcing that the company’s goods are desirable. Throw in the low cost relative to actual legal action, and it is no surprise that social media airings of these types of complaints are becoming more prevalent in the fashion industry. Especially since smaller brands often get a sympathetic ear in the press and market, relative to larger trademark bullies or counterfeiters.

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Turning back to the legal front, it seems like M2Malletier is facing an uphill battle, compounded by their lack of U.S. trade dress registrations on the “signature handle” as found on their handbags. Proving trade dress infringement can be a costly and difficult endeavor for even the best-capitalized brands, and it is often a rite-of-passage for smaller brands when they realize that while they may have invested in some IP protection beforehand, they will often need to make even more in the way of IP investment if they ever want to be in a position to launch an enforcement campaign. Especially when the counterparty is better-funded, and more famous to boot. To that end, we are also seeing more companies in the fashion industry try and file design patents on their creations, in order to give themselves a potential alternate path to victory in any future IP dispute.

Ultimately, for smaller brands tasting sweet success is often accompanied with the bittersweet realization that their IP protection needs bolstering. While it is best to anticipate IP issues in advance, many times smaller brands do not have the resources or sophistication to do so, and are left in a reactive position when forced to encounter encroachments by copyists up and down the commercial chain. The smart brands, and the ones most likely to flourish in a sustainable manner, take the lessons they learn on the IP front and act on them. Because while nothing is worse for a smaller brand than irrelevancy, it is also true that some of the twistiest IP problems are encountered by those who are almost famous.

Please feel free to send comments or questions to me at gkroub@kskiplaw.com or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome.

Spanish Luxury Handbag Brand M2Malletier Claims CH Carolina Herrera Stole Its Signature Handle [Fashionista]

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Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique. The firm’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.

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