Monday 12 May 2008

The largest trademark verdict in US history? say lawyers at Kilpatrick Stockton who apparently helped win a $304 million victory for shoe company Adidas AG late last Monday. According to Kilpatrick Stockton's press release (c/o this blogger's friend Allison Mcdade at Dell):

"Adidas sued retailer Payless ShoeSource Inc. in 2001 in federal district court in Portland, Ore., for selling imitation footwear that looked like Adidas' three-stripe shoes. Following a 15-day trial, a nine-person jury took two days to decide that Payless had violated Adidas' trademarks. Payless claimed its shoes did not violate Adidas' trademark since they featured two and four stripes, not three. But lawyers
for Adidas argued the so-called knockoffs could cause confusion or dilution of Adidas's logo trademark. "Our entire position was that the three-stripe mark was a very powerful and strong brand," says Kilpatrick partner Bill Brewster. Also representing Adidas was partner Charles Henn Jr. and local counsel Stephen Feldman at Perkins Coie. Payless was represented by Lathrop & Gage partner William
Rudy and Spillane Shaeffer Aronoff Bandlow partner John Schaeffer. A spokesman for Lathrop & Gage referred comment to Collective Brands Inc., which owns Payless.
The Topeka-based company said in a statement that it is "reviewing the verdict and assessing its impact." "The company believes that the verdict was excessive and unjustified," the statement said. "The company will ask the court to set aside the verdict and, if it is not granted, intends to take all necessary steps to overturn it."

The trial was just the latest foray into Adidas' battle to enforce its international ownership of the three-stripe logo. On April 10 the European Court of Justice ruled against retailers C&A, H&M and others, whose lawyers argued that stripes were such common symbols they should be available for anyone to use. Gregor Vos and Antoon Quaedvlieg of Amsterdam-based IP boutique Klos Morel Vos & Schaap represent Adidas in that litigation. In the U.S., says Brewster, the Germany-based shoe manufacturer has won settlements over similar trademark claims against about a dozen retailers, including Target. Brewster adds that a pending claim against Kmart headed toward settlement. Kilpatrick, which has represented Adidas for about 15 years on trademark matters, now is preparing for another trademark infringement trial, this time against Wal-Mart. A lawyer for Wal-Mart, though, says the Payless win will have no impact on his trial. "It's similar issues but very different acts," says Baker Botts partner Russell Falconer. "Basically, they're different products at issue and different documents. The cases have nothing in common other than that they're both trademark infringement acts." Trial is scheduled for October."

This blogger notes that the latest ECJ judgement in Adidas's three stripe enforcement program hinted at a favourable result for the brand owner in Europe too.

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