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Levi’s Legal Department: The Ultimate Pocket Protectors

Posted in Trademark Law

by Nathan Geronimo

Earlier this month, the Ninth Circuit addressed the standard for evaluating a claim for trademark dilution under the Trademark Dilution Revision Act of 2006 (“TDRA”), 15 U.S.C. §1125(c). The TDRA is meant to protect a property right in a trademark. Dilution prevents the use of a famous mark by others in any manner that lessens the uniqueness of the mark. Under the TDRA’s predecessor, the Federal Trademark Dilution Act (“FTDA”) and cases under the FTDA, to pursue a claim for trademark dilution, the offending junior mark had to be “identical or nearly identical” to the mark it was diluting. The new standard represents a more holistic approach, applying factors that focus on, among other things, the degree of similarity between the two marks.

In Levi Strauss & Co. v. Abercrombie & Fitch Trading Co., Levi Strauss & Co. brought suit against Abercrombie & Fitch, alleging that Abercrombie’s “Reuhl” pocket design diluted Levi’s trademark “Arcuate” pocket design. Both marks are featured on the pockets of jeans manufactured by the two companies. 

ArcuateLevi’s Arcuate Design

Levi’s “Arcuate” design consists of two connecting arches that meet in the center of the pocket, and is featured on garments accounting for over ninety-five percent of Levi’s sales revenue over the past thirty years.  

Abercrobie’s Reuhl Design

Abercrombie’s “Reuhl” design features two less-pronounced arches that are connected by a “dipsy doodle” which resembles the mathematical sign for infinity. The design on the Abercrombie jeans sits lower on the pocket than Levi’s Arcuate design.

Levi’s has litigated a number of trademark dilution and infringement cases based on its Arcuate design against such companies as Esprit US Distribution Ltd. and Fox Hollow Apparel Group. According to the pleadings in a recent case Levi’s filed against several Japanese business entities which sold products featuring the Arcuate design in San Francisco and New York, Levi’s Arcuate design is the oldest known apparel trademark in the United States. Levi’s has used the Arcuate design since 1873.

California’s Northern District Court dismissed the case against Abercrombie on the grounds that the marks were not identical or nearly identical, applying the old standard for trademark dilution under the FTDA. On appeal, the Ninth Circuit reversed the District Court’s ruling, finding that in passing the TDRA with new and distinct language, Congress intended to provide a new standard for trademark dilution claims, and that Playboy Enterprises, Inc. v. Welles and othercases applying the former “identical or nearly identical” standard no longer apply.

The Ninth Circuit found that several aspects of the TDRA are worth noting, the first of which is the fact that Congress did not make merely surgical linguistic changes to the FTDA in response to prior case law. Instead, Congress created a new, more comprehensive federal trademark dilution act. Congress omitted any reference to the “identical or nearly identical” standard of Playboy and its progeny, and instead defined “dilution by blurring” as the “association arising from the similarity between a mark or a trade name and a famous mark that impairs the distinctiveness of the famous mark.” 

Congress also included a non-exhaustive list of dilution factors, the first of which is “the degree of similarity between the mark or trade name and the famous mark.” Congress did not require an association based on the “substantial” similarity, “identity,” or “near identity” of the two marks. Instead, the word chosen by Congress, “similarity,” sets forth a less demanding standard than previously employed by courts under the FTDA. 

So what is the new standard for trademark dilution cases? Much like some of Levi’s fits, it is much more “relaxed.” A plaintiff must show that a junior mark is likely to impair the distinctiveness of the famous mark. 

The relevant factors include:

  • the degree of similarity between the mark or trade name and the famous mark;
  • the degree of inherent or acquired distinctiveness of the famous mark;
  • the extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark;
  • the degree of recognition of the famous mark;
  • whether the user of the mark or trade name intended to create an association with the famous mark;
  • and any actual association between the mark or trade name and the famous mark.

Under the old Playboy standard, Levi’s claim based on dilution of its pocket trademark must fail. However, under the new standard, Levi’s has a fighting chance. The Ninth Circuit’s interpretation of the TDRA, and the new, factor-based inquiry standard for trademark dilution means more litigation to show that application of the new factors support a finding that one mark dilutes another.  Litigation, as we know, can be very expensive. Let’s hope the parties have deep pockets!