A federal appeals court in New York has sided with Thom Browne in the latest round of a closely-watched trademark case waged against it by adidas. In a summary order on Friday, as first reported by TFL, a panel of judges for the U.S. Court of Appeals for the Second Circuit affirmed a final judgment from the lower court in the stripes-centric case that followed closely from an eight-day trial in New York in January 2023, in which a federal jury found that Thom Browne did not engage in trademark infringement or dilution of adidas’ three-stripe mark by offering up apparel and footwear bearing a four-stripe motif.
On the heels the jury’s verdict and corresponding judgment from the district court, adidas waged an appeal with the Second Circuit, arguing that Judge Jed Rakoff of the U.S. District Court for the Southern District of New York gave incorrect instructions to the jury about how to gauge consumer confusion, thereby, favoring Thom Browne, and similarly erred in excluding the testimony of one of adidas’ experts during the parties’ trial.
The Second Circuit’s Order
Following arguments before the a Second Circuit on April 17, a panel of judges for the appeals court affirmed the lower court’s judgment, thereby, sealing the victory for Thom Browne. Best known for its signature shrunken suiting, Thom Browne garnered the attention of adidas after it introduced a multi-stripe mark of its own, which it began applying to a growing number of sportswear apparel and footwear items.
Jury Instruction: On the issue of the jury instruction, counsel for adidas argued that Judge Rakoff erred in telling jurors to consider “whether [Thom Browne’s] accused products and adidas products compete for the same consumers” when adidas was not arguing point of sale confusion. “Adidas expressly said it was not asserting confusion at the point of sale, and instead, limited its theories of confusion to initial interest confusion and post-sale confusion,” adidas’ counsel Charles Henn of Kilpatrick Townsend & Stockton told the Second Circuit panel last month. As such, Henn argued that the judge should not have prompted the jury to consider whether the parties compete for the same consumers.
Counsel for Thom Browne, Robert Thomas Maldonado of Wolf Greenfield, argued in response that the court “made it clear that this was a pre-sale and post-sale confusion case.” Moreover, he told the panel that “the instruction on competitive proximity is not an instruction that is limited to point-of-sale cases, [and instead,] competitive proximity is relevant, even in post-sale cases.”
Siding with Thom Browne, the Second Circuit held that adidas “cannot show an error, let alone a prejudicial one, in the district court’s charge.” In fact, the appeals court stated that the district court instructed the jury “multiple times to confine its inquiry to initial-interest and post-sale confusion,” noting that “the differences between adidas’s proposed instruction as to the third Polaroid factor and the instruction the district court gave are immaterial: adidas could not articulate a meaningful distinction between ‘competitive proximity’ and ‘competition for the same consumers.'”
Evidentiary Objections: At the same time, adidas failed to win over the Second Circuit on its evidentiary objections, which saw the sportswear giant take issue with the court’s exclusion of testimony of one of its experts, William D’Arienzo, and its inclusion of the testimony of one of Thom Browne’s experts, who was permitted to testify on “the appearance of [adidas’s] Three-Stripe Mark as a historical matter in numerous situations.” Finding no abuse of discretion on the part of the district court, the Second Circuit panel again affirmed the judgment of the lower court.
Next steps: Adidas is not without options, as it can petition to cert on this motion, Martin Schwimmer, a partner in the Trademark and Copyright Practice Group at Leason Ellis, tells TFL.
No New Trial for adidas
Not the only development in the case, Judge Rakoff sounded off on a pending motion on Friday. In response to adidas’ October 2023 bid for a new trial, Judge Rakoff stated in a brief order that “upon full consideration of the parties’ various submissions in connection with this motion and the record of the evidentiary hearing held on December 21, 2023, the court hereby denies Adidas’s motion.” The judge noted that “an opinion setting forth the reasons for this ruling will be issued in due course, at which time judgment will enter.”
The case is adidas America, Inc., et al., v. Thom Browne, Inc., 1:21-cv-05615 (SDNY).
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