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Clifford Chance

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Intellectual Property

Talking Tech

Stripe Wars: Inside the Thom Browne vs Adidas Trademark Case

Intellectual Property Consumer Fashion 30 January 2023

In 2021, Adidas America, Inc., and Adidas AG, (known for its athletic and sportswear clothing and footwear) filed a suit against Thom Browne Inc, a luxury American menswear brand primarily known for its tailored suit jackets and trousers.

Adidas' complaint alleged trademark infringement and trademark dilution after Thom Browne released apparel bearing its "Four Bar" and "Grosgrain" designs (featuring four stripes) on footwear and high-end activewear collections. Adidas cited similarities between the stripes included on Thom Browne designs and the adidas three-stripe motif. Following a trial before the U.S. District Court for the Southern District of New York, an eight-person jury found in favor of Thom Browne, specifically that it did not infringe on or dilute any of adidas' trademarks and the Court dismissed the complaint from adidas in its entirety.

Adidas' Arguments

Adidas first implemented the use of the three-stripe motif, (the "Three Stripe Mark") in 1952 on its running shoes, and since then, it has been a prominent aspect of adidas branding. The Three Stripe Mark is featured on clothing and shoes and is the subject of several trademark registrations and applications owned by adidas (see, e.g., figure 1). The Three Stripe Mark is prominently featured on a wide range of adidas products, (see, e.g., figure 2), including footwear and clothing, serving as a significant element in the brand's visual identity. In 2005, Thom Browne introduced the use of three parallel stripes on certain products, including athletic wear. After communication between the two brands in 2008, Thom Browne altered its design to feature four parallel stripes on its garments, as opposed to three (see, e.g., figure 3). 

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Details of The Claim

Although the number of stripes on the Adidas Products (three) and the Thom Browne garments (four) differ, adidas claimed that the four-stripe motif on Thom Browne Products was likely to confuse customers into thinking that the Thom Browne Products were made and sold by, or otherwise connected with adidas. Adidas contended that this confusion began before the point of sale, i.e., when customers saw the Thom Browne Products online, in store, or through social media posts. In the claim, adidas argued that "consumers “are likely to assume that [Thom Browne’s] goods originate from the same source, or that they are affiliated, connected, or associated with [adidas]", because "Thom Browne uses stripes in a manner that is “similar to [its] three-stripe mark in appearance and overall commercial impression."

Adidas requested (i) $7.8 million in damages, (ii) additional punitive damages, and (iii) a proportion of the proceeds from infringing sales of the Thom Browne Products if successful in its claim. Because adidas asserted claims of trademark infringement and dilution against Thom Browne, adidas had the burden of proof.

The Instruction on Trademark Infringement

When assessing the claim of trademark infringement, the jury was instructed by the judge to consider their personal experiences in determining the likelihood of confusion between Adidas products bearing the Three Stripe Mark and Thom Browne products. Additionally, the jury was asked to evaluate the following factors:

  • Trademark Strength: the perceived strength of the Adidas Three Stripe Mark, taking into account factors such as advertising, media coverage, sales success, and customer studies linking the mark to adidas.
  • Degree of Similarity: the degree of similarity between the Adidas Products and the Thom Browne Products.
  • Target Consumers: whether the Adidas Products and Thom Browne Products compete for the same customer base.
  • Actual Confusion: whether there is evidence that consumers are confused about which company offers the Thom Browne Products.
  • Product Quality: the quality of the Thom Browne Products in comparison to the Adidas Products, taking into account that confusion would be more likely if the products are of similar quality.
  • Consumer Attention: the degree of care and attention that an ordinary consumer would use when encountering the Adidas Products and the Thom Browne Products.
  • Bad Faith: whether Adidas demonstrated that Thom Browne acted in bad faith, with the intention of causing consumers to associate Thom Browne Products with the Adidas Products.

Burden of Proof for Trademark Dilution

To demonstrate that Thom Browne had diluted the adidas trademark, adidas had to demonstrate that the Thom Browne designs on the Products were likely to "dilute" the distinctiveness of adidas' Three Stripe mark by eroding the distinctiveness in the eyes of the public. To show this, adidas had to demonstrate that:

  • The Three Stripe Mark was famous, i.e., widely recognised by the general consuming public as designating adidas as the source of goods bearing the mark. 
  • The Three Stripe Mark was famous before any of the accused Thom Browne Products were first sold, and
  • Thom Browne's use of its Four Bar and Grosgrain designs on the Thom Browne Products was likely to dilute the distinctiveness of adidas' mark.

To support this, adidas cited the collaboration between Thom Browne and European football club FC Barcelona, and (ii) a reference made by GQ magazine in 2018 which dubbed Thom Browne as "the other Three Stripes’ company" to illustrate the likelihood of confusion between the two brands. Legal counsel for adidas also presented evidence that almost 30% of people surveyed believed that the Thom Browne Products were associated with adidas. However, when instructing the jury, the Court noted that the survey was limited to consumer opinions post sale, rather than pre-sale as well (adidas contended that confusion could take place both in pre- and post-sale scenarios). Legal counsel for Thom Browne countered that the two brands were very different to one another, therefore limiting the possibility of confusion in the marketplace.

The Verdict

In its 12 January 2023 verdict, the jury concluded that Thom Browne was not liable on adidas' claim for trademark infringement or for trademark dilution.  adidas has reportedly indicated that it intends to appeal the verdict.

What this Means for You

The Three Stripe Mark is a well-known and iconic part of adidas' branding, and the company has a history of protecting this classic brand asset. Therefore, companies should be cautious when using stripes as a key feature of their designs. Although adidas was unsuccessful in this case, it has successfully defended its rights in the Three Stripe Mark in previous legal actions. Documents included in the case demonstrated that adidas has filed more than 90 law suits and has entered more than 200 settlement agreements since 2007 in relation to the Three Stripe Mark.

However, the Thom Browne decision sheds light on the use of stripes in a way that may be permissible. It is important to note that both brands primarily target distinct market segments, especially in view of the difference in price point. In addition, Thom Browne is primarily a high-end menswear designer, whereas adidas designs for all audiences, with a target market of those who are, arguably, interested in wearing the apparel for sports and fitness rather than making a "fashion statement". The outcome of the jury's decision may have been different if the two brands targeted the same segment of consumers within the exact same market. Brands should consider this difference when performing trademark clearances or assessing potential trademark claims against third parties.Top of Form

Although the conclusion in this case was favourable for Thom Browne, there are ongoing proceedings between the parties in the United Kingdom, in which Thom Browne has attempted to cancel nineteen adidas trademarks, with a counterclaim from adidas. This matter will be reported on by a judge, as opposed to a jury as in New York, which could produce a different result. The outcome of the cases in the United Kingdom are yet to be seen, but brands should continue to be aware of using designs that are similar to rights protected by trademarks on their own apparel to avoid the risk of costly litigation.

References

[1] Listing for ADICOLOR CLASSICS OVERSIZED SWEATSHIRT​, Adidas.co.uk (https://www.adidas.co.uk/adicolor-classics-oversized-sweatshirt)

For further analysis on pressing legal issues in the fashion industry today, read our previous Talking Tech articles:

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