This article is written by Pankhuri Bhatnagar pursuing Certificate Course in Intellectual Property Law and Prosecution from LawSikho.

Introduction

Louis Vuitton Malletier is a French fashion house and one of the world’s most prominent luxury products companies. For 6 continuous years (from 2006-2012), it was named as the world’s most valuable luxury brand, surpassing even brands like Chanel, Gucci, and Dior. The company was founded in 1854 by Louis Vuitton as a luggage business, but it was only in 1896 that his son created the brand’s famous monogram, the interlocking L and V in a floral pattern. The purpose of creating the monogram was to brand their business and to prevent copycats from infringing into their territory. Fast forward 12 decades, and it is now one of the most recognizable marks in the world! 

As the value of the mark grew, so did the range of products to which the mark applies. The brand now manufactures not just handbags and traveling luggage, but also jewellery, watches, shoes, fragrances, ready-to-wear outfits, and accessories. What sets it apart is the fact that each Louis Vuitton product offers “absolute and distinguished quality, attention to detail and a story behind every product”. Given their reputation, large product range, and the care and attention that goes into creating each design, it became necessary for the brand to protect its designs and brand name, from being copied or misused. As a result, the brand has over 18,000 intellectual property rights to its credit and pro-actively protects itself against all acts of infringement. This raises the question, how exactly does the brand manage such a huge IP portfolio and what all measures do they take to protect their intellectual property? The article seeks to explore and analyse the same.

What kind of IP protection do Louis Vuitton products have?

From the designs of the outfits to the patterns, shapes, logos, symbols, and names used in connection with it, there is a ton of creativity that goes into manufacturing fashion and luxury goods. In order to protect these creations of mind prevailing in the fashion industry, Louis Vuitton has acquired various types of legal protection for its work.

• Design rights

Registering the designs of their products helps in preventing third parties from copying the original and new, aesthetic, or ornamental aspects of their product design. The design can be a 3D feature such as the shape of a shoe or a 2D feature such as a pattern or material print. 

• Copyright

France, which is the brand’s homeland, allows for footwear and fashion articles to be given copyright protection. Even fashion shows and the fabrics used in high fashion dresses can be protected as a work of ‘artistic craftsmanship’.

• Trademark

This refers to the name, logos, and symbols of the brand used on the luxury goods, which helps in distinguishing the goods of Louis Vuitton from those of other brands.

• Patent

The brand owns a large number of patents for its products and processes, for example; a patent for inventing a packaging device for their product, inventing a wheeled suitcase with a retractable rod, etc.

Intellectual property protection strategy of Louis Vuitton

IP rights are legal tools that the brand can exploit in order to protect its creativity and innovation. It enables them to maintain a competitive advantage over other brands and to protect their image in the fashion industry. The website of Louis Vuitton claims that their intellectual property department manages more than 18,000 IP rights with the help of a dedicated team of 250 lawyers and law enforcement professionals across the world. At first, these figures might seem unusually large. However, taking into consideration the long history and reputation of the brand, quantity of the products in circulation all over the world and the number of registered and unregistered Intellectual property assets relating to the products, the brand’s immense focus on the protection of its intellectual property makes much more sense. Their IP legal department is based in Paris with regional offices across the world in places such as Dubai, New York, Tokyo, Hong Kong, Seoul, Athens, Istanbul, etc.

The brand utilizes both the “shield” and the “sword” strategy for protecting its intellectual property assets. 

1. Sword strategy: The brand utilizes its intellectual assets as “weapons” and aggressively attacks other actors who attempt to copy or infringe their protected assets in any manner.
2. Shield strategy: Registration of all works and acquiring an extensive IP portfolio also acts as a “shield” against possible copying of their designs by competitors and enables the brand to maintain its dominant position in the market.

Multiple IP registrations and protection

Many readers might feel that these umpteen registrations of designs are unnecessary. There are so many companies that have been in existence for decades, they don’t require 18,000 IP registrations! However, these multiple protection strategies have come in handy for the brand on numerous occasions. For instance, in 2017, Louis Vuitton filed a case against i-Fe apparel Inc. and others for selling duplicate goods which infringed their trademark. Instead of simply claiming infringement of the famous Toile Monogram Design, it turned out they had 9 separate trademark registrations which make use of aspects of that design. 

Thus, the brand’s separate IP registration strategy allowed it to raise 9 separate claims for trademark infringement, counterfeiting, and dilution. The defendants were found guilty of infringing all and this resulted in greater monetary compensation for Louis Vuitton! Further, this strategy also helps the brand in catching culprits who make slight alterations to the various aspects of the Toile Monogram Design.

Zero tolerance policy against counterfeiting

Owing to its status and reputation as a luxury brand, Louis Vuitton is one of the most counterfeited brands in the fashion world. Statistics say that in 2004, 18% of the counterfeit goods snatched in the European Union were Louis Vuitton fakes! The company has a team of investigative agencies and lawyers to combat counterfeiting and spends almost half of its communication budget to this end. The company claims to have great respect for the creativity that goes into making its products and has established a zero-tolerance policy for counterfeiting. They also claim that counterfeiting goes beyond the mere act of selling a cheap, duplicate bag to tourists in a faraway location; the consequences go far beyond and could threaten the survival of the brand. 

Consequences of counterfeiting: As recognized by Louis Vuitton

1. Violation of the skills, talent, and creativity of all the artists and craftsmen to whom the company owes its immense success. 
2. Undermining the investments and knowledge which went into developing the products and the company
3. Infringement and “robbery” of all the registered intellectual property rights 
4. Customers might be fooled by duplicate goods of lower quality, which would adversely affect the reputation of the brand
5. The sale of duplicate goods may be used to fund illegal or immoral activities, as the actors behind counterfeiting are already engaged in illegal activities
6. The counterfeit products are often manufactured in dangerous working conditions contrary to labour laws
7. There may also be instances of underage and forced labour in unregulated working conditions which may be a violation of human rights. Thus, the “cheap” bags are actually hiding a high price paid by the community

Their fight against counterfeiting can be traced back to the year 1896 when Georges Vuitton created the unique and distinct monogram design in order to prevent exploitation of the brand’s success at the hands of imitators. Fast forward to recent years, and it was reported that in the year 2017, the company initiated more than 38,000 anti-counterfeiting procedures! These included civil, criminal, and customs actions and proved to be helpful in getting rid of some criminal networks and provided much needed relief to the labourers who were engaged in working for such networks. 

Contributory liability principle

Keeping in mind the above impact which counterfeiting can have on society as a whole, Louis Vuitton pioneered the application of the “contributory liability principle”. This initiative was taken in 2003 and the purpose was to target all the “counterfeiting intermediaries” who were involved in providing services to the underground counterfeiting networks. This included courier companies, landlords of places used for counterfeiting, and payment facilities among others. The program proved to be quite effective and eliminated certain hotspots for counterfeiting such as the New York Canal Street.

The rationale behind introducing the contributory liability principle

1. Selling duplicate goods leads to the indirect funding of criminal activities at the expense of the brand’s customers and harms the community as a whole.
2. There is a need for all the actors unknowingly involved in the process, to conduct their business activities with due diligence and share responsibilities along the value chain.
3. The brand holds the string belief that responsibilities and opportunities ought to be shared in both the virtual as well as the offline world, and every actor owes a duty of care to protect his customers from fraud or misleading practices.

Explicit disclaimer on their website

The official website of Louis Vuitton clearly states that their original products are sold exclusively through 2 channels:

1. The Louis Vuitton boutiques, owned and staffed by LV, present in various locations across the world.
2. The e-commerce section of the official website.

Purchasing goods beyond these 2 channels would be entirely at the risk of the buyer and the company does not guarantee the quality or authenticity of these products. This provision has served to save the brand’s reputation from being tarnished in case of fake goods and shifts the responsibility to the buyer, in consonance with the age-old principle of “Let the buyer beware”.

Registration of domain names and combating cyber squatting

Despite the number of precautionary measures in place, miscreants always find a way to create menace, whether offline or online. Although Louis Vuitton has registered its official website domain, many miscreants have bought domain names containing the brand trademark such as uslouisvuitton.co, louisvuittonbag.site, and louissvuittonprices.com which are deceptively similar to the original name and capable of confusing the customers. Some other website names clearly indicate that they may be engaged in selling counterfeits such as replicalouisvuitton.com, 2013cheaplouisvuittons.com, buycheaplvbagsonline.com, replicabolsalouisvuitton.com, cheapluxurylouisvuitton.com, etc. 

The brand pro-actively takes notes of such websites that keep popping up and institutes legal action against the domain name owners for trademark infringement and cybersquatting. The brand’s IP department has an Internet division responsible for tracking these websites. In 2013, the brand took action for cybersquatting against 98 such domain names. In 2017, more than 6000 litigious websites were reported and shut down and approximately 12,000 online auctions were terminated.

Terms of using their official website

The terms and conditions of their official website also play an important role in protecting the intellectual property contained in the website pages. The terms clearly lay down that the website pages and all the content on them (including text, graphics, photos, artwork, the software, codes, formats, devices, links, and files linked to it) are protected by IP rights such as copyright and trademarks, and Louis Vuitton is either the owner or the licensee of that content. 

People who are using the website can only do so for personal and private use, as opposed to using the material for their own commercial purposes. Thus, the illustrations are shown on the brand’s website, description of outfits, the design of the website, and other related aspects are all protected by intellectual property rights and prevent competitors from exploiting that content. Acceptance of these terms and conditions is also by default, as anyone who accesses the website is deemed to have irrevocably accepted the associated terms and conditions. The only remedy to not be bound by the terms is to avoid using the website altogether.

Aggressively taking legal action

The most important technique used by the brand to defend its intellectual property is to be extremely vigilant in monitoring any unauthorized exploitation and taking quick legal action against the same. The company has a reputation for filing an extraordinary ordinary number of cases, even against persons and companies belonging to a different industry! A few of their interesting and controversial legal battles are summarized below:

• Britney Spears

The brand does not even spare musicians and artists and once filed a suit against Britney Spears for counterfeiting! Louis Vuitton claimed that the music video of the song “Do something” shows a pink Hummer which has a design resembling their “Cherry Blossom” design and logo. Britney was held to not be liable, however, MTV online and Sony BMG were heavily fined and ordered to stop circulating the video.

• Simple living 

In 2007, LV sent a cease and desist notice to an art student who had created a satirical illustration of a malnourished child holding a designer bag, which the brand claimed infringed its IP rights. The courts ruled in favour of the brand and held that the picture was a clear violation of copyright. However, the student continued to use the picture claiming artistic freedom and in May 2011, a Hague court ultimately held that Nadia Plesner, the student has the right to freedom of expression and is not liable.

• Parody products

A pet products company in Nevada called Haute Diggity Dog introduced a new line of parody products named “Chewy Vuitton”. This obviously did not go over well with the Louis Vuitton officials who filed a lawsuit for copyright infringement and trademark dilution. They also proceeded to take action against fashion brands like “Sniffany & co” and “Chewnel”. However, the US court of appeals came to the decision that the Chewy Vuitton product line was differentiated from the LV products, and constituted a successful parody. As such, there was no IP infringement. 

• South Korean restaurant case

There was a fried chicken restaurant in South Korea by the name of “Louis Dak”. In a trademark battle with the brand, the court found that the name was too similar and the restaurant logo also closely mirrored LV’s designs. The restaurant owner immediately changed the name to “Louisvui Tondak” and was served with a notice for non-compliance with the court’s order. Thus, as a general practice, it is best to remain on the safe side and avoid mirroring the identity of a well-known company.

Conclusion

It takes a lot more than just mere money to create a brand, especially an internationally well-renowned luxury brand like Louis Vuitton. Promoting the unique and distinct characteristics which the brand has to offer and protecting its image from getting tarnished by cheap replicas is one the most crucial things a company can do for building a successful brand image. While most businesses only focus on Trademark registration and perhaps, design rights, Louis Vuitton has left no stone unturned in protecting its legacy. It has more than 18,000 registered intellectual property rights consisting of design rights, trademarks, patents, and copyright. It also maintains an IP department of 250 legal professionals across the globe for the strict enforcement of these rights.

From the above discussion, we may conclude that the company follows both a shield (defending against exploitation by registering works) and a sword (attacking other actors who infringe these rights) approach in protecting its IP assets. Its zero-tolerance policy against counterfeiting also reflects the respect the company has for the creativity of its artists and employees. The company engages in numerous litigations, even against actors of unrelated industries like restaurants and barber shops which attempt to use their registered designs! The zeal with which they defend their IP assets is admirable and other industry leaders may take a cue from the brand, in how to proactively take a stand to protect their brand reputation.

References

• https://core.ac.uk/download/pdf/9403814.pdf
• https://eu.louisvuitton.com/eng-e1/magazine/articles/brand-protection#preserving-creativity
• https://www.knobbe.com/news/2019/01/divide-and-conquer-how-louis-vuittons-brand-protection-strategy-might-increase

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