Chanel Sues An "Upcycle" Jeweler: The Lanham Act Protects Goodwill
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| Source: The Chanel Complaint |
Long time no see! I was super busy this week, so I apologize for not having posted in a while. Let's get back to business as usual. The art of upcycling is not new. In fact, with the rise of eco-conscious consumers, various brands routinely upcycle their products as part of a larger effort to tackle the waste issue in fashion. Luxury brands have joined the chorus as well. Miu Miu recently undertook a large-scale upcycling project titled "#UpcycleByMiuMiu", remixing archival pieces. Despite good intentions, upcycling is not free of legal issues in the context of third-party manufacturers and sellers.
Last week, Chanel filed a complaint in the United States District Court for Southern District of New York against an "upcycle" jeweler for trademark infringement under the Lanham Act. The jeweler manufactures "chains, earrings, and bracelets" out of authentic Chanel buttons and sells them in the marketplace. In the complaint, Chanel emphatically points out that the jeweler misappropriated the goodwill of Chanel CC Monogram trademark ("Chanel Marks"), which is federally registered. With the federal registration coupled with a long history of actual use, Chanel's CC Monogram is incontestable as a mark. Chanel further alleges that the infringing act is willful because the jeweler knowingly "trade[s] on the recognition and commercial value of Chanel Marks" after being notified of the alleged wrongdoing by Chanel's legal team. Chanel is requesting the court to order an injunctive relief as well as a disgorgment of the ill-gotten profits "flowing from [the jeweler's] use of Chanel Marks".
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| Source: The Chanel Complaint |
To my knowledge, Chanel's logo-bearing buttons can be traced back to and identified with a specific season. That's how Chanel is able to authenticates its products, ferreting out fakes masquerading as genuine Chanel products. What's more, Chanel has been in the business of manufacturing and selling its own line of custom jewelry bearing Chanel CC Monogram. Chanel is also known for its tight control over distribution channels. Chanel is thus making it very clear that it never authorized the jeweler to use Chanel buttons. Chanel is particularly disturbed by the fact that, as displayed, there is no appreciable difference between "Chanel's genuine product and [the jeweler's] unauthorized product". Before initiating this lawsuit, Chanel had sent a cease-and-desist letter to urge the jeweler to at least make it conspicuous that the infringing product has no association with Chanel by means of a disclaimer in packaging. The jeweler did not implement any modifications to the effect.
I'm fairly certain that Chanel can prevail in this case. Chanel exhausted all the necessary measures before it finally took the issue to court. As a side note, I can't see how the jeweler's use of Chanel buttons can be seen as upcycling in the first place. (That's why I used the quotation mark!) The jeweler is just stealing the global renown and the attendant goodwill Chanel has built after years of artisanal craftsmanship and effective advertisement. The takeaway here is that, for prospective upcyling projects, you'd better make sure that you are not infringing upon brand trademarks of materials you are using. In the end, the U.S. trademark law deeply cares about the protection of goodwill.
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