United States: Buy It, Wear It, Love It … Just Don't Copy It: Chanel's Aggressive Actions To Protect Its Trademarks

Last Updated: February 10 2017
Article by Anurita S. Varma

"If you want to be original, be ready to be copied" — Coco Chanel, founder and namesake of the Chanel brand

Chanel, a billion-dollar fashion company that produces and sells luxury consumer products, identifies its products by the "Chanel" trademark and the "CC Monogram" trademark, which consists of two interlocking back-to-back letter Cs. Not surprisingly, Chanel has encountered several instances where it felt the need to initiate (or threaten) trademark infringement proceedings. This article discusses three such proceedings. First, let's get an idea of what "trademark infringement" means.

The Lanham Act, codified at 15 U.S.C 1051, et seq., is the primary federal trademark statute of law which prohibits trademark infringement. The USPTO defines trademark infringement as the unauthorized use of a trademark or service mark on or in connection with goods and/or services in a manner that is likely to cause confusion, deception or mistake about the source of the goods and/or services.

The lawsuit Chanel filed in 2016 provides some insight on what it takes to prevail on a trademark infringement claim. Chanel sued Northern California resident Teresa Charles for, among other claims, trademark infringement, alleging that Ms. Charles used the two Chanel trademarks on products she sells on Instagram, Shopify.com and Pinterest. See Chanel, Inc. v. Charles (N.D. Cal., June 9, 2016, No. 16-CV-00307-LB) 2016 WL 4491871.

To prevail, Chanel had to prove "(1) that [Chanel] has a protect[a]ble ownership interest in the marks; and (2) that [Ms. Charles'] use of the mark is likely to cause consumer confusion, thereby infringing upon the [Chanel's] rights to the mark." See id. at 4 (citing Dep't of Parks and Recreation for State of California v. Bazaar Del Mundo, Inc. 448 F.3d 1118, 1124 (9th Cir. 2006)).

As to the latter prong, eight factors are considered to determine the likelihood of consumer confusion: (1) strength of the mark; (2) proximity of the goods; (3) similarity of the marks; (4) evidence of actual confusion; (5) marketing channels used; (6) type of goods and the degree of care likely to be used by the purchaser; (7) defendant's intent in selecting the mark; and (8) likelihood of expansion of the product lines. See id (citing Jada Toys, Inc. v. Mattel, Inc. 518 F.3d 628, 632 (9th Cir. 2007)).

Ultimately, the California Northern District Court ruled in Chanel's favor, finding that it has a protectable interest in the two marks, as it owns more than 50 federal trademark registrations on the two marks, 42 of which are incontestable, and which date back to 1925. Id. at 5.

The court also considered the eight aforementioned factors to determine that Ms. Charles' continued use of the marks is likely to cause consumer confusion. First, the two marks are strong as they date back 80 years, are used by Chanel on a wide range of products, are associated by the public with Chanel-branded products, and yearly sales of the mark-bearing products total hundreds of millions of dollars. Second, the fashion and household goods sold by Chanel and Ms. Charles are nearly identical. Third, the two marks used by Chanel and Ms. Charles are identical. Fourth, Chanel and Ms. Charles market the products in similar ways through authorized online retailers. Fifth, Chanel and Ms. Charles target customers familiar with and interested in Chanel-branded products. Sixth, the goods are high-quality items. Seventh, Ms. Charles intentionally uses the marks to associate her products with Chanel's, thus taking advantage of the marks' public recognition and value. Eighth, both Chanel and Ms. Charles have expanded the types and number of products on which the Chanel marks are used. See id.

Ms. Charles was permanently enjoined from manufacturing, distributing, selling, promoting, importing or offering to sell any goods bearing the Chanel marks. Id. at 10. She was also ordered to remove all references to the Chanel marks from any platform she uses, and was permanently enjoined from claiming in any way to be associated with Chanel. See id.

It seems simple enough. Don't sell products using protected Chanel trademarks. But the following cases show that even with uncertainty as to whether the "consumer confusion" prong is met, an aggressive fashion powerhouse like Chanel might nevertheless prevail.

In 2014, Chanel sued Chanel Jones, an Indiana resident and owner of "Chanel's Salon, LLC" for several trademark-related claims, including federal trademark infringement. See Chanel, Inc. v. Chanel's Salon LLC, et al. 2014 WL 4348292 (N. D. Ind.).

Chanel claimed that Ms. Jones commercialized the famous "Chanel" mark for her beauty salon business, by using the mark in connection with the name of her salon, and the salon's products and services. Chanel warned that there is "no absolute right to exploit one's given name commercially ... if such use is inconsistent with Chanel's rights." See id. Indeed, Ms. Jones was not using her entire name, only the portion that was identical to the famous Chanel trademark. Ultimately, Chanel forced Ms. Jones to sign a consent judgment that permanently barred her from using the Chanel trademark and required that she remove all mentions of the trademark, i.e., she was essentially prohibited her from using her name commercially in any way, ever.

The alleged trademark infringement in this case is distinguishable to that of Ms. Charles. An argument can be made that Ms. Jones' use of the mark "Chanel's Salon" is not likely to cause confusion as to the source of the mark. Although both Chanel and Ms. Jones offer products that are nearly identical, i.e., beauty-related products, it appears that the two marks — "Chanel's Salon" and "Chanel" are not exactly identical. The lawsuit also did not mention whether the font of the "Chanel" mark used by Ms. Jones in connection with her salon was identical to the widely-recognized font and image used by Chanel on its products, i.e., the mark in all capital letters — "CHANEL." Thus, an argument could be made that customers familiar with the "Chanel" mark would not be confused as to the source of the "Chanel's Salon" mark and would recognize it as separate and distinct from Chanel.  Additionally, it is unclear whether Ms. Jones was intentionally using the "Chanel" mark to associate her salon with Chanel to take advantage of the "Chanel" mark's public recognition and value. Interestingly, a Google Search for "Chanel's Salon" in Indiana reveals that Ms. Jones has since changed the name of her salon to "Up Scale Beauty Salon LLC," indicating that Ms. Jones likely targets customers interested in upscale products and services, which appears to be similar to Chanel's customer base. Despite the uncertainty as to whether certain factors of the "consumer confusion" test were met, the fashion powerhouse was nevertheless able to prevail against the pro se Indiana salon owner.

Shortly after the lawsuit against Ms. Jones, in 2015, Chanel was likely involved in trademark infringement proceedings through Instagram1 against a 20-year-old named Chanel Bonin. Ms. Bonin started the account "@Chanel" on Instagram in 2011, approximately three years before Chanel started its Instagram account, "@chanelofficial."

Several of Ms. Bonin's posts depicted products bearing the famous "Chanel" and "CC Monogram" trademarks. For example, one post showed a rainbow-colored hairclip with the word "Chanel" on it. Another post showed a drawing of a girl wearing a shirt with the "CC Monogram" trademark on it. Additionally, there were comments on Ms. Bonin's posts referring to her account as "the Chanel account." 

Although it is unclear whether Chanel did in fact initiate proceedings against Ms. Bonin through Instagram, Ms. Bonin's account was temporarily disabled, and when Ms. Bonin returned to Instagram in January 2016, she claimed her account was "hacked," changed her Instagram name to "@chanel82732" and the posts showing Chanel's trademarks had mysteriously disappeared.

Again, the alleged trademark infringement by Ms. Bonin is distinguishable to that of Ms. Charles. Ms. Bonin did not appear to be selling any Chanel products. Also, although Ms. Bonin's account name was "@chanel," her profile picture was a picture of herself, and her name "Chanel Bonin" was listed under the picture. Customers who are familiar with Chanel would likely assume that the account belonged to a girl named Chanel Bonin, not the fashion powerhouse. Furthermore, it is unclear whether Ms. Bonin's post of a hairpin with the word "Chanel" on it shows her intent to take advantage of the "Chanel" mark's fame and recognition. Her intent could have been to post a picture of a hairpin with her name on it. The picture of a drawing of a girl wearing a t-shirt with the "CC Monogram" on it, however, likely shows an intent to associate with the famous mark, although it did not appear that Ms. Bonin was in any way commercializing or marketing the mark. Thus, it is unclear whether Ms. Bonin's actions would rise to the level of creating "consumer confusion" under the two-prong test. Nevertheless, the fashion powerhouse again prevailed, without even having to file a lawsuit.

With the rise of social media, Chanel will likely have to continue fighting the battle to protect its trademarks, but it has certainly set a precedent as to who will win the battle.

"In order to be irreplaceable, one must always be different."  — Coco Chanel

Footnotes

1 Certain social media platforms, such as Instagram, provide an in-house process for reporting intellectual property violations.

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