About a year ago, I wrote an article discussing the Christian Louboutin v. Yves St. Laurent decision, Christian Louboutin S.A. v. Yves Saint Laurent America, Inc., 778 F. Supp.2d 445 (S.D.N.Y.2011) (the “Mistaken Case”), and how it exposed the lack of communication between Customs and Border Protection (“CBP”) and the United States Patent and Trademark Office (“USPTO”). A link to that article can be found here. What I left out of my article was my confusion and disagreement with the court’s decision to purportedly cancel Christian Louboutin’s (“CL”) trademark (trade dress) for the red lacquered sole adorning its high heeled shoes (“Mark”).
In the Mistaken Case, the lower court made an overreaching and overbroad ruling that prohibited single color trademarks (trade dress) from being protected in the fashion industry. A couple of months ago, the U.S. District Court of Appeals for the Second Circuit overturned the lower court’s holding, which was based on, as Judge Cabranes put it, an “[i]n correct understanding of the doctrine of aesthetic functionality”. See Christian Louboutin S.A. v. Yves Saint Laurent America Holding, Inc., 696 F.3d 206 (2012) (the “New Case”).
It wasn’t until I was at a Christmas party explaining the case to some friends, one of which was rocking the long heels and red bottoms (CL shoes), that I decided to revisit the case. I was pleasantly surprised to have one of those “it’s not me, it’s you” moments, when I realized that it was the lower court that misunderstood the application of the aesthetic functionality doctrine, not me. The New Case, although punting on a decision regarding the aesthetic functionality doctrine, holds that a single color is worthy of trademark protection, even in the fashion industry, if it has acquired distinctiveness by establishing secondary meaning in the public’s eye. In other words, the mark or symbol has come to be known as a brand or source identifier.
The courts in the Mistaken Case and the New Case both made quick work of determining that the Mark had acquired distinctiveness by establishing secondary meaning. However, in the Mistaken Case, the court used the doctrine of aesthetic functionality to terminate the Mark. A mark is aesthetically functional when an ornamental feature of the mark effectively limits competition within the relevant market. I can understand the argument that by allowing CL a monopoly over the lacquered red sole, the Mark could limit competition. However, as the Mistaken Case failed to appreciate, and the New Case deftly articulated, it is the contrast; the arbitrary presence of the lacquered red sole that makes the Mark distinctive. With this in mind, the court directed the USPTO to amend the Mark so that it only applies in situations where the upper shoe contrasts with the lacquered red sole.
This decision was a win-win for everybody involved, including all the consumers out there who spent the premium for the long heels and red bottoms.