By Katelyn Kohler
In January 2023, a jury ruled that luxury brand Thom Browne did not infringe or dilute adidas’ “Three-Stripe Mark” trademark. Despite the losing verdict, the legal and fashion communities remain engaged as the case evolves. The recent appeal filed in the 2nd Circuit has introduced a new chapter, sparking renewed debates about the power of adidas’ trademark rights.
Background and Allegations
adidas America Inc. and adidas AG (“adidas”) sued Thom Browne Inc. (“Thom Browne”) for alleged trademark infringement and dilution under the Lanham Act. The dispute centers on Thom Browne’s use of adidas’ signature three-stripe design trademark (“Three-Stripe Mark”) on its sportswear and athletic-style footwear. Interestingly, this is not the first time adidas has engaged in such legal battles. In fact, since 2008 they have initiated more than 90 lawsuits and entered into over 200 settlement agreements over the protection of this same mark. Notably, Thom Browne had previously employed a three-bar design on its apparel, changing to a four-stripe design following adidas’ objection in 2007.
The lawsuit claims that Thom Browne’s use of three and four stripes on its products holds the potential to mislead and confuse consumers who associate these patterns with adidas. Browne sought dismissal based on lack of stating a sufficient claim, lack of standing, and the court’s lack of jurisdiction over a pending case before the Trademark Trial and Appeal Board. While the court agreed that it lacked jurisdiction over an opposition involving an unregistered mark, it denied Thom Browne’s motion on all other aspects. This ruling allowed the other pertinent issues to proceed to trial.
Trademark Strength and Recognition
Interestingly, the Court had continued to emphasize the Three-Stripe Mark as a recognizable and widely acknowledged symbol of adidas which has gained substantial public recognition. The Court acknowledged that the media has often referred to it as adidas’ “iconic trio of stripes,” the “famous adidas three stripes,” and the “ubiquitous three stripes,” as well as citing multiple cases that have already favored the unitary Three-Stripe Mark. A unitary trademark is one that maintains a consistent and recognizable core design, even if it appears in different forms. This helps protect the trademark’s distinctiveness and prevents competitors from using similar variations that could potentially cause confusion among consumers. The Three-Stripe Mark’s ubiquity and global recognition have led to its inclusion in various forms of athletic and leisurewear, further establishing its association with the adidas brand.
adidas holds a total of 24 federal trademark registrations from the United States Patent and Trademark Office (PTO) for the Three-Stripe Mark. These registrations encompass various categories, including athletic footwear, clothing, and sporting goods.
Thom Browne further argued that adidas failed to define the Three-Stripe Mark adequately in its complaint. However, the courts have historically recognized adidas’ unitary Three-Stripe Mark across multiple registrations. As such, the Court found that not only did they plead a sufficient claim, but they also substantiated it with excess evidence.
Standing and Opposition Before the TTAB
adidas has supported its legal claims, including using the Polaroid Factors—a set of criteria used to assess trademark infringement claims. These factors consider the strength of the plaintiff’s trademark, similarity between marks, proximity of products, evidence of consumer confusion, and more. Furthermore, adidas has pursued a trademark dilution claim, asserting that the Three-Stripe Mark’s fame is a central component and that Browne will cause its recognition to dilute.
Thom Browne specifically contends that adidas America lacks ownership of relevant registrations, suggesting it cannot assert claims and only adidas AG may proceed. However, adidas America’s role as the principal distributor in the U.S. grants it a commercial interest in the mark, conferring standing under section 43(a) of the Lanham Act. Therefore, the plaintiffs’ standing was deemed legitimate.
Additionally, Thom Browne had also contested the court’s jurisdiction to address the pending opposition before the Trademark Trial and Appeal Board (TTAB). The court acknowledges its lack of jurisdiction to intervene in this ongoing TTAB matter. Since the Complaint doesn’t challenge any registered mark, but instead invokes section 37 for Thom Browne’s pending applications, the Court dismisses the invitation to pioneer such an expansion over the explicit language of the statute. The Court’s decision enabled the trial to proceed on only the infringement and dilution claims.
Jury Verdict
Despite adidas’ strong trademark recognition, the jury ruled in favor of Thom Browne on both claims. The Defendants contested the similarity between marks, highlighting Browne’s switch to using four stripes, and the distinction in product proximity due to their mainstream vs. luxury market positioning.
Some overlap exists between the brands as their paths had crossed in 2006. At that time, Mr. Browne featured three horizontal bars instead of four; Upon adidas’ request, he complied, adding a fourth stripe. adidas reengaged Thom Browne in 2018, coinciding with Browne’s creation of pre-game outfits for FC Barcelona and the Cleveland Cavaliers athletic teams. This marked Browne’s expansion into the active-wear category, aligning with broader trends among luxury brands as well as athletes’ preference for luxury attire.
While influenced by sport, Browne’s approach differs from mimicking adidas. Browne’s distinctive features include a stack of four bars on sleeves or pant legs, and a red-white-and-blue grosgrain tab—inspired by ribbons on sports medals. Despite being a luxury brand, Browne’s expansion into active-wear has raised concerns for adidas. Significantly, Browne asserts that their products target a distinct market with a higher price point which highlights a stark contrast between the brands. As a witness, Mr. Browne advised against using his $630 running shoes for actual running, unlike adidas, which was developed for sporting activities.
Nevertheless, the jury ruled in favor of Browne.
Recent Developments
Following the losing verdict, the German sportswear brand has lodged an appeal in the 2nd Circuit. On appeal, adidas asserts that the initial trial suffered from erroneous jury instructions, particularly the description of the Polaroid Factors over customer confusion and product proximity. Instead of accepting the plaintiffs’ request that the jury assess confusion during the “initial interest” or “post-sale” phases of consumer engagement, the Court instructed the jury that the inquiry was “whether the accused products and adidas products compete for the same consumers.” Therefore, adidas argues that such confusion is not limited solely to the “point of sale,” thereby weakening Browne’s defense about product differentiation based on social classes, price points, or markets.
In conclusion, the ongoing legal battle between adidas and Thom Browne explores complex legal principles at the intersection of luxury fashion and sportswear branding. This case further amplifies the critical role of trademarks and intellectual property litigation in preserving brand recognition amongst changing consumer perceptions. As both parties strive to safeguard their brand identities, the resolution of this dispute is likely to influence how businesses protect their trademarks.
The Appeals Court will review any potential jury instruction errors and possible lead to a new trial. The lingering question: Just how closely intertwined are luxury brands and mainstream sportswear in the modern marketplace? The Court will have to decide.
Katelyn Kohler is a second-year law student at Suffolk University in Boston, specializing in Sports & Entertainment, Labor & Employment, and Intellectual Property Law. She holds dual degrees from Ithaca College in Business Administration: Sports Management and Legal Studies. With a passion for these fields, Katelyn is dedicated to pursuing a legal career that combines her love for sports and the law.
