Let's avoid this Fashion Faux Pas : Trademark and Passing Off
Why proving goodwill in fashion trademark cases remains the ultimate luxury problem.
I recently reported on decreasing inflation in Europe—down approximately 4.2% in the Eurozone—despite ongoing tensions between Ukraine and Russia. As a result, I was surprised to see Chanel increase the price of one of my favorite face creams by $5 (USD).
Many dermatologists—both in publications like Tatler and in real life—recommend reducing the frequency of facials after age 40. At 36, going on 37, I find myself considering that advice.
For those in the IPR space or beauty industry cohorts, a five-dollar increase in a cream within six months is significant.
Perhaps I should start buying these creams earlier.
This situation reminds me of the well-known Louboutin trademark case involving the red sole being marketed by lower-end retailers on shoes without proper attribution as homage works. The issue was that the company—a billion-dollar fashion giant—could not prove that any goodwill was being appropriated through the use of its red sole emblem.
The first element required to establish an actionable claim for “passing off” (i.e., trademark violation) is goodwill. Consumer confusion alone is not sufficient to prove trademark infringement.
A company must demonstrate that it has established goodwill or a relationship with consumers—meaning that the product allegedly “passing off” (in the Louboutin case, a non-branded heel with a glossy red sole) damages the positive relationship between the brand and its customers.
Let’s be realistic: fashion is a fiercely competitive ecosystem. Proving that a consumer has a meaningful or positive rapport with a fashion brand is extremely challenging, if not nearly impossible—as demonstrated in the Louboutin red sole case. As Bentley and Sherman note in their seminal text, goodwill is “the attractive force that brings in custom,” meaning it must have a measurable impact on consumer behavior.
Culturally, many factors influence a consumer’s purchasing decisions. For example, a company’s commitment to corporate social responsibility may drive loyalty, as seen with brands like Whole Foods, which has cultivated goodwill in the organic grocery market. For goodwill to exist, consumers must choose goods or services based on the reputation the business has developed.
It is particularly difficult for fashion brands to prove a positive influence on consumers, especially given the scrutiny many face. Fast-fashion giants such as H&M and Forever 21, for instance, have been criticized for failing to meet public expectations regarding ethical standards and manufacturing practices.
Goodwill can also be associated with distinctive brand identifiers such as NIKE, MARLBORO, or ROLLS-ROYCE, where the brand name itself carries strong recognition. However, in the Louboutin case, the legal team was unable to effectively argue along these lines, likely due to time constraints and the nature of the proceedings.
Additionally, courts in Europe are generally reluctant to grant monopolies over descriptive elements, as established in Reddaway v. Banham. Therefore, even if consumers associate red-soled shoes with Louboutin, the court did not find this sufficient to establish exclusive rights.
Another potential argument for Louboutin (LVMH) could have been based on goodwill associated with “get-up” or packaging—specifically, the brand’s distinctive aesthetic and advertising style, which appeals to a luxury market segment. However, this would still require proving misrepresentation—that the defendant was misleading consumers or unfairly exploiting the brand’s reputation.
While this argument might have been somewhat stronger, it is unlikely that Louboutin could have demonstrated that competitors selling red-soled heels without attribution were materially damaging its goodwill. Homage designs—styles that evoke or reference high-fashion designers—are not inherently unlawful and may, in some cases, even enhance the visibility and desirability of the original brand.
Ultimately, although Louboutin remains strongly associated with red-soled stilettos, it could not prove that the defendant’s actions caused harm to the goodwill it had established with consumers.
