As first appeared in DC Journal
By Aron Solomon
A jury in New York recently ruled against Adidas, refusing to award the German sporting goods giant the $8 million it sought in damages against designer Thom Browne.
Adidas, founded in 1949 by Adolf Dassler, began producing sports shoes in his mother’s laundry room in Herzogenaurach, Germany. The company’s name combines its founder’s nickname, “Adi,” and the first three letters of his last name, “Das.”
Adidas quickly gained a reputation for producing high-quality athletic footwear, and by the 1960s, the company was sponsoring major sports teams and athletes around the world. Today, Adidas is one of the largest sportswear manufacturers in the world. While the company’s headquarters is still in Herzogenaurach, its cultural hub is in Berlin.
Having lived in Berlin, arguably the Adidas capital of the world, I can attest to Die Drei Streifen (The Three Stripes) being a national motto reverberating through Germany’s cities, anchored by stunning Adidas boutiques. The Adidas stripes are part of the literal and metaphorical fabric of the nation.
Berlin is also a major global fashion hub, which makes this battle between Adidas and Thom Browne much more interesting and goes right to the heart of Browne’s successful legal argument.
Browne has been using four stripes as part of his designs. Part of Browne’s argument is that comparing his brand with Adidas is comparing apples and oranges. While Adidas sells a sweatshirt for $40 (often available for half at discount stores), a Thom Browne cardigan can cost close to $1,500.
Adidas sought to frame its case entirely as an intellectual property issue based on stripes, which backed itself into a corner. If this is just about Browne infringing upon Adidas IP, the legal argument comes down to whether Adidas not only owns Drei Streifen but, well, all stripes.
New Jersey personal injury lawyer Karim Arzadi notes that the U.S. court understood the magnitude of the issue presented:
“It becomes a slippery intellectual property slope if a court allows Adidas to own stripes. While it’s understandable that Adidas and all large brands want to protect what they make, it’s never good when courts overextend a company’s IP rights.”
The court justifiably decided that Adidas couldn’t own the notion of stripes as applied to clothing. Counsel for Thom Browne successfully argued that stripes are a common design element and that Adidas did not have protectable IP rights over every stripe.
As the BBC noted, Adidas isn’t new at this. Since 2008, Adidas has initiated 90 lawsuits and agreed to more than 200 settlement agreements relating to its ownership of the three stripes and what is known as its trefoil mark.
Adidas will appeal the verdict and may win on appeal. While the trial court reached the right decision, an appeal court could find the three stripes so remarkably iconic that Thom Browne had tread on its IP, especially in light of a 2007 Adidas complaint against Thom Browne when the company was using three of its own stripes before changing to the current four.
About Aron Solomon
A Pulitzer Prize-nominated writer, Aron Solomon, JD, is the Chief Legal Analyst for Esquire Digital and the Editor-in-Chief for Today’s Esquire. He has taught entrepreneurship at McGill University and the University of Pennsylvania, and was elected to Fastcase 50, recognizing the top 50 legal innovators in the world. Aron has been featured in Forbes, CBS News, CNBC, USA Today, ESPN, TechCrunch, The Hill, BuzzFeed, Fortune, Venture Beat, The Independent, Fortune China, Yahoo!, ABA Journal, Law.com, The Boston Globe, YouTube, NewsBreak, and many other leading publications.