On September 5, 2012, the United States Court of Appeals for the Second Circuit, in Christian Louboutin S.A. v. Yves Saint Laurent Am. Holding, Inc., No. 11-3303 (2d Cir. 2012), held that a single color can be used as a trademark in the fashion industry. The highly anticipated ruling is a significant victory for the fashion industry and ensures that French designer Christian Louboutin has a valid and enforceable trademark on his contrasting red-soled shoes.
Since their introduction to the fashion world in 1992, Louboutin’s high-end shoes have become well known and recognizable for their bright, lacquered red bottom outsole. In 2008, the U.S. Patent and Trademark Office granted Louboutin a trademark in its “lacquered red sole on footwear” (the “Red Sole Mark”). In early 2011, Louboutin learned that competing French fashion house Yves Saint Laurent (“YSL”) was marketing and selling a “monochrome” line featuring one color on an entire shoe, including an all red shoe with a red insole, heel, upper and outsole. In April 2011, Louboutin filed trademark infringement, dilution, and unfair competition claims against YSL in the United States District Court for the Southern District of New York and sought a preliminary injunction to bar YSL from marketing and selling any shoes, including YSL’s monochrome red shoe, bearing outsoles in a shade of red similar to the Red Sole Mark. In response, YSL counterclaimed to cancel the Red Sole Mark on the grounds that it was not a protectable mark because it was merely “ornamental” and “functional.”
In August 2011, U.S. District Judge Victor Marrero denied the injunction and held that the Red Sole Mark was invalid because single color trademarks are inherently “functional” and can never serve as a
protectable trademark in the fashion industry. Judge Marrero noted that any commercial purposes that may support extending trademark protection to a single color “do not easily fit the unique characteristics and needs – the creativity, aesthetics, taste, and seasonal change – that define production of articles of fashion.” Additionally, Judge Marrero found that “allowing one artist or designer to appropriate an entire [color] shade . . . would unduly hinder not just commerce and competition, but art as well.”
On appeal, the Second Circuit disagreed and held that Judge Marrero’s per-se rule that a single color can never serve as a trademark in the fashion industry is inconsistent with the Supreme Court’s decision
in Qualitex Co. v. Jacobson Products Co., 514 U.S. 159, 162 (1995), which held that single colors alone can sometimes serve as valid trademarks. Indeed, single color trademarks have been protected for years where the trademark holder can show that consumers associate the color with their brand or service, as opposed to finding it merely to be decorative or visually pleasing (e.g., Tiffany blue box, Owens-Corning pink fiberglass insulation). The Second Circuit found that the Qualitex decision requires an “individualized, fact-based inquiry” into whether consumers associate the single color with the trademark holder’s brand or service. Further, the Second Circuit held that the “functionality” defense is an affirmative defense that courts must consider only after determining whether the trademark merits protection.
Turning to the Red Sole Mark, the Second Circuit analyzed Louboutin’s advertising expenditures, media coverage, and sales success, as well as consumer surveys submitted by both parties, and held that Louboutin’s red soles have acquired limited “secondary meaning” as a distinctive symbol that identifies the Louboutin brand only when used as a red outsole “contrasting with the remainder of the shoe.” The Second Circuit ordered the U.S. Patent and Trademark Office to modify the Red Sole Mark to apply to situations only where the red lacquered outsole contrasts with the upper of the shoe. Accordingly, the Second Circuit upheld Judge Marrero’s denial of the preliminary injunction as to the YSL monochrome red shoe because “the red sole on YSL’s monochrome shoe is neither a use of, nor confusingly similar to, the red-sole mark.”
The ruling offers relief to the fashion industry in ensuring that unconventional uses of color as a brand and source identifier will stay protected, at least where secondary meaning exists. Additionally, the Second Circuit’s decision also provides useful guidance for competitors to offer competing products utilizing such colors without infringing color trademarks.