Who Will Reign Supreme in the Battle for the Trade Marks?
The internet age means that brands can develop a substantial following in jurisdictions where they have no physical presence. This can lead to problems with counterfeiting, and sometimes even more pernicious issues, where the brand’s products are not readily available for purchase in a particular jurisdiction. An ongoing case involving popular US streetwear brand Supreme, provides a salutary lesson to other brands on the importance of having a multi-national trade mark registration strategy, accompanied by rigorous measures to identify and combat infringement.
Supreme has grown substantially from its beginnings as a single New York skate store opened by founder James Jebbia in 1994. Owned by Chapter 4, the brand is now known the world over and it has developed a cult following. Indeed, the disorderly crowds that formed around its London store when new collections were released led the local authority to insist that Supreme address the problem with crowd-control measures, or face closure. This resulted in a ticketing system to regulate the number of eager shoppers able to enter the store on new-release days. Stories like this help to illustrate the pull of the Supreme brand. It also helps to explain why other companies may seek to capitalise on the popularity of the Supreme brand.
Supreme Italia and ‘legal fakes’
“Supreme Italia” and International Brand Firm Ltd (“IBF”) popped up a few years ago offering Supreme-branded products to customers in Italy and elsewhere. Neither Supreme Italia nor IBF have any connection to Chapter 4, although IBF successfully registered various figurative Supreme trade marks in Italy and other countries. Some commentators have characterised this paradoxical situation as IBF and Supreme Italia selling ‘legal fakes’, with the two entities carrying on a trade using the marks.
This prompted Chapter 4 to issue proceedings against Supreme Italia and IBF for trade mark infringement and unfair competition, a cause of action which is broadly analogous to passing-off under English law. The Italian High Court found in favour of Chapter 4, primarily on the basis that Chapter 4’s own Italian mark pre-dated that of IBF, but also because the level of public recognition of Chapter 4’s Supreme brand in Italy was such that Chapter 4 had acquired unregistered rights in the brand. Unfortunately for Chapter 4, this wasn’t the case in all contested jurisdictions.
Supreme Spain and the current state of play
The battleground shifted to Spain where “Supreme Spain”, linked again with Supreme Italia and IBF, had opened a number of stores (article in Italian), as well as a website, selling a range of items under the Supreme brand. Unlike in Italy, Chapter 4 registered its Spanish Supreme mark after IBF had registered its own Spanish mark. This put Chapter 4 in a weaker position when the case came before the Spanish courts. The Spanish courts were not persuaded that Chapter 4 owned unregistered rights in the Supreme mark in Spain. The lack of advertising and bricks and mortar shops certainly wouldn’t have helped Chapter 4’s case in this respect.
Having emerged victorious at first instance, Supreme Spain continues to operate its stores and website using the Supreme brand. No doubt Chapter 4 will look to appeal the Spanish court’s judgment. Conversely, IBF and Supreme Italia are appealing the judgment of the Italian court, which means that that case may remain unresolved for some time yet.
Lessons to be learned
There are additional factors at play in relation to the Supreme brand, which make the situation quite complex, such as the descriptive nature of the word “supreme” as a superlative designating quality. This has hampered Chapter 4’s efforts to register the mark at the EU Intellectual Property Office (“EUIPO”), with the EUIPO finding that the descriptive nature of the mark also meant it was devoid of distinctive character. These issues aside, there are some lessons to be learned from the difficulties Chapter 4 has encountered in Spain and Italy, for popular brands that have yet to meaningfully expand into new territories. Pre-emptive registrations of key marks may serve to benefit such brands in the medium to long term, particularly as a deterrent to unscrupulous retailers who might seek to profit on the brand’s reputation by trading in so-called legal fake products. When considering such registrations, brands should keep in mind any requirements to prove use of the mark in the relevant territory. Indeed, one of the difficulties which Chapter 4 encountered in Spain related to its inability to prove use of the Supreme mark in Spain. Careful planning, with an eye to future expansion, is key to ensure that brands aren’t caught out.