In an article in Issue 192 (NZLawyer 7 September 2012), this author discussed the ruling of Judge Marrero that a single colour can never serve as a trade mark in the fashion industry[1].

In Round 2 of this legal saga[2], Christian Louboutin (“Louboutin”) has won a technical victory against its rival Yves Saint Laurent (“YSL”). The Federal Appeals Court reversed District Court Judge Marrero’s earlier ruling and upheld Louboutin’s trade mark registration to the colour red for outer soles.

Judge Jose Cabranes, who wrote for the unanimous three-judge panel, explained that Judge Marrero's conclusion was based on an incorrect understanding of the doctrine of aesthetic functionality:

"We see no reason why a single-colour mark in the specific context of the fashion industry could not acquire secondary meaning – and therefore serve as a brand or source identifier – if it is used consistently and prominently by a particular designer that it becomes a symbol”.

Based on the evidence submitted by Louboutin, it was plain to the Appeals Court that the red sole had the requisite distinctiveness to merit trade mark protection.

Harley Lewin, lawyer for Louboutin welcomed the decision: “We are happy to have achieved a victory … We are pleased that our central premise, that colour on the red sole can be a trade mark … we consider this to be a significant win, not only for Louboutin, but for the fashion industry in general”.

However with magnanimous diplomacy, the Appeals Court affirmed Judge Marrero’s order to the extent that it also declined to protect the use of red lacquered soles “in all situations”.

Judge Cabranes expressly noted, for instance, that YSL’s use of a red outsole on monochromatic red shoes would not infringe on Louboutin’s trade mark because the evidence demonstrated the red sole to be an identifying mark of Louboutin only when used with a different coloured top:

“it is the contrast between the sole and the upper that causes the sole to ‘pop’ and to distinguish its creator”

Consequently, the Appeals Court modified Louboutin’s trade mark registration to a red lacquered outer sole that contrasts in colour with the rest of the shoe.

For its part, YSL has also described the ruling as “a total victory for us”. David Bernstein, the lawyer who represents YSL said that “it makes it clear that trade marks can’t be used in an anti-competitive way”.

In summary, this pragmatic decision has safeguarded Louboutin's trade mark rights by maintaining the validity of its colour mark, albeit limited to contrasting colour. By the same sleight of hand, the ruling has also preserved YSL's commercial freedom to continue to retail its monochromatic red shoes.

The case has been remitted back to Judge Marrero to consider YSL’s ancillary claim for damages for alleged interference with its business. It would be unsurprising if the parties reach a more harmonious resolution to offset legal costs. It appears to this author that the ruffled feathers of two fickle fashion beasts have more or less been victoriously soothed.

This article was published in NZLawyer, October 2012.