Serena Nath is an IPilogue Writer and a 2L JD candidate at Osgoode Hall Law School.

Known for its cheap and trendy clothes, Chinese fast-fashion retailer Shein has seen great success over the past several years. Its low prices are typically attributed to its frequent and large-scale productions, but another reason for such low pricess may be intellectual property theft. Recently, . Artist Magdalena Mollman, also known professionally as Maggie Stephenson, filed a lawsuit in the U.S. District Court, Central District of California, on June 15 suing Shein for over $100 million in damages for unauthorized reproductions of her artwork “One is good, more is better.”

Mollman versus Shein

In 2019, with the U.S. Copyright Office and included Copyright Management Information (CMI) on her artwork. To obtain intellectual property protection, is common, as it allows for one to bring a lawsuit for infringement of a U.S. work, while also allowing for one to have their copyright on the public record and a certificate of registration. However, by also including on her work, Mollman acquired further IP protection for her artwork, as CMI is information about a copyrighted work, such as the terms and conditions for use of the work, the owner’s name, and the name of the work.

With copyright protections in place for Mollman’s art, she was able to control who produced replicates and sold her work. This including , such as Sephora, Urban Outfitters, and Elle Magazine to sell prints of art at differing prices, with the lowest price being $19. However, Mollman had not authorized Shein to sell prints of her artwork. Despite the lack of authorization, from 2019 to 2021, for as low as $4 per print, and with intentional removal of Mollman’s CMI, including her name and signature. Additionally, Shein reportedly added false CMI by featuring their own brand and logo in their reproduction of Mollman’s artwork which implied that Shein is the rightful author and copyright owner. As a result, for copyright infringement, vicarious and/or contributory copyright infringement, removal of copyright management information, and false copyright management information.

Intellectual Property Theft is Common for Shein

This lawsuit is simply the latest that Shein has faced since rising to popularity. Shein has a long history of being sued for IP infringement — a source even claimed that Shein’s parent company, Zoetop Business Co., has been named a defendant in at least 50 federal lawsuits in the U.S. for IP infringement. to steal their designs, and in doing so, was able to keep product prices low by spending very little on designing their products. Additionally, these smaller businesses would be less likely to bring an action due to a lack of financial resources. when Tiina Menzel, a German-based artist, discovered that Shein had been selling products with her art, she was unable to bring a lawsuit due to costs.

Interestingly, Shein has also been known to steal IP from larger businesses too, such as Dr. Marten, Levi Strauss, and Ralph Lauren. , streetwear brand Stussy Inc. sued Shein for copyright infringement, claiming that Shein was selling products using Stussy’s logo without authorization.

Fast-Fashion Drives Intellectual Property Theft

Shein’s latest lawsuit highlights the ongoing issue of IP theft in the fashion industry. IP from smaller companies/artists is frequently exploited by large fast-fashion companies, allowing them to mass-produce trendy products at a low cost, without consequence, for smaller artists typically lack the resources to legally battle large fast-fashion companies.  T . There must, then, be alternative legal solutions to protect small businesses from intellectual property theft, such as a sort of government-funded civil legal system. Without an adequate solution, Shein and other fast-fashion companies can continue to exploit small businesses with few consequences.

The post Fast-Fashion Continues to Harm Small Businesses and Artists appeared first on IPOsgoode.

In order for the turnover of styles and inventory to be profitable for fast-fashion retailers, costs must be cut somewhere. As such, intellectual property (IP) law and labour law issues have become increasingly ubiquitous for fast fashion brands and have drawn condemnation in the court of public opinion. For example, fast-fashion retailers, such as H&M, are increasingly facing scrutiny with respect to their .

Furthermore, international fast fashion retailer, , is no stranger to IP law disputes.

This time, Zara has set its sights on the innovative and contemporary clothing brand ACRONYM and has debatably copied its famous “functional strap” outerwear. Is it fair for Zara to copy a design that costs ACRONYM a significant amount of time and to produce?

As noted by the Toronto-based style law blog , which was co-founded by myself and IPilogue colleague Alessia Monastero, Zara’s repeat offences do not go unnoticed. In fact, two of Zara’s most notable IP disputes involve ACRONYM and .

In this case, ACRONYM founder, , has been selling its impeccably made coats for over 10 years. In fact, it has become known for its high-quality garments that are made to last. These designs feature a “functional strap” on the insides of the coats and contain a label that reads: “Interior crossbody strap allows wearer to carry over their shoulder.”

: ACRONYM, : Zara's Imitation Label

Aside from its creative designs, ACRONYM also uses a unique advertising plan, which markets the brand almost exclusively to fashion enthusiasts. For example, unlike mainstream brands, such as Chanel and Louis Vuitton, ACRONYM does not advertise on television, does not heavily seek out celebrities as ambassadors, nor aggressively use social media for promotion and marketing. Nevertheless, many have slowly started to become aware of the label due to Hugh’s partnerships with Stone Island and Nike.

The aim of copyright law, generally, is the protection of copyright owners to disallow others to copy one’s work without permission. The promise of this protection promotes creativity and the orderly exchange of ideas. However, it seems as though Zara does not entirely care about such protective mechanisms, since it is to copyright infringement. Perhaps, the revenues from selling copied designs en-mass offsets their litigation costs, though this is just speculation.

ACRONYM is protected by its , which was filed and published in 2003. Under this , ACRONYM “has the right to prevent third parties from making, selling or importing articles bearing or embodying a design which is a copy, or substantially a copy, of the protected design, when such acts are undertaken for commercial purposes.” Zara’s functional strap certainly meets all of these criteria.

The United States Court of Appeals in , stated, “[I]f, in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it to be the other, the first one patented is infringed by the other.”

Since the primary difference between the ACRONYM and Zara products is the quality of the material, an “ordinary observer” can very easily mistake the two labels since a reasonable shopper normally does not spend a lot of time examining the nuances of product quality. In essence, the products appear “substantially the same”.

Zara’s defence relies on a “sufficient distinction” between the two products. However, as seen in , the threshold for this is quite high. What constitutes as “sufficiently distinct” is often an additional part to the product or a substantial difference in the overall look. Given that Zara’s imitation does not, in fact, make a significant change to the original ACRONYM design, it is unlikely that a court will view it as being “sufficiency distinct”. Even if the court does find a distinction, it may decide to look at the prior art to ensure that no confusion will take place with respect to the product.

It nevertheless seems unfair that Zara is able to provide its consumers with a product that looks very similar to one that is being sold for almost 6 times its price point. However, since the onus remains on the party alleging the infringement to bring the issue forward, some labels may think that the cost of litigation –both time and effort– does not present a valuable trade-off.

Take ACRONYM, for example, with designs that are incredibly well made. While ACRONYM takes a detail-oriented approach to the quality, style, and longevity of their products, Zara’s research mostly consists of the latest trends and looking at the designs of other labels. As such, Hugh is not bothered by the copycats that have set their sights on the label, especially the fast fashion retailers that focus solely on style and very little, if at all, on quality. This is because Hugh does not feel as though he is losing the customers who prefer to purchase Zara’s cheaper imitation for the look as opposed to the quality. In fact, when asked his opinion on Zara’s imitation of the signature jacket, Hugh reportedly  with a simple: “LOL.”

Well played.

Saba Samanian is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post Zara: the Repeat Offender appeared first on IPOsgoode.