Stussy is the latest brand to name Shein in a trademark infringement and counterfeiting lawsuit. According to the complaint that it filed in a federal court in California on Thursday, Stussy alleges that its trademarks – including (but not limited to) its stylized brand name – are “widely recognized and understood as standing for [its] excellent reputation and products” and that by using them without its authorization on apparel and footwear, Shein is “knowingly and intentionally” infringing those marks “for the purpose of causing confusion and diverting customers” away from Stussy for its own benefit.
In the newly-filed lawsuit, Stussy claims that Shein is on the hook for trademark infringement and counterfeiting, trademark dilution, and unfair competition in connection with its sale of products that bear “copies and close reproductions of the STUSSY trademarks.” By making use of the “Stussy” mark in a way that is “virtually identical to the genuine STUSSY marks” on apparel and footwear, for which Stussy maintains federal trademark registrations, Stussy claims that the Chinese fast fashion giant’s use goes beyond trademark infringement and meets the higher bar of counterfeiting. However, “in order to hide [its] counterfeit products,” Stussy claims that in at least some instances, Shein “avoids using the term ‘Stussy’ in connection with [the listings for] its counterfeit Stussy products.”
As distinct from other trademark cases, the harm at play as a result of Shein’s alleged sale of Stussy trademark-bearing goods is heightened here, per Stussy, due to the significant value of the brand’s trademarks. The STUSSY marks – which “have come to represent and symbolize the excellent reputation of [its] products and valuable goodwill among members of the public throughout the world” – are “more valuable than ordinary marks,” the 42-year-old skate/surf brand claims, given that “Stussy’s business model is to create an exclusive brand with limited distribution.”
As a result of this model, which sees it offer up a limit drops of its wares in order to court enduring and outsized demand, Stussy argues that there is “much unmet demand for [its] products and for products with [its] look.” And while it has carefully crafted its strategy to include such limited product quantities, Stussy argues that Shein has “attempt[ed] to fill the market for Stussy’s products” by way of its copycat wares.
Shein has “impaired Stussy’s valuable goodwill, created a likelihood of confusion, actually confused the public and otherwise adversely affected Stussy’s business” by way of its alleged infringements,” causing Stussy to “suffer great damage and injury,” including loss of profits and other damages. With that in mind and given that Shein has allegedly “earned illegal profits as the result of [the] aforesaid acts,” Stussy is seeking to disgorge Shein of any corresponding profits. Additionally, Stussy is seeking injunctive relief to temporarily and permanently bar Shein from infringing or diluting its trademark “or using or causing the use of any word, term, name, symbol, device or combination thereof that causes or is likely to cause confusion, mistake or deception.”
The case come as companies, such as Stussy, Supreme, and other streetwear/skatewear, have built sizable businesses on a model that sees them regularly “drop” limited quantities of new products, a tactic that has since been adopted across much of the fashion industry and beyond. The result has come on the form of enduring demand – and a robust resale market for such goods – but at the same time, has brought with it widespread copying aimed at filling the gap intentionally left by these brands when it comes to consumer demand.
Supreme, for instance, has been plagued by sweeping efforts to piggyback on the striking demand for – and relatively limited supply of – its branded wares, with companies like Supreme Italia, for instance, playing on global demand for Supreme and its markedly unhurried expansion efforts outside of a few U.S. cities and a smattering of international capitals, in order to “win over less-informed fans of the streetwear brand and convinced retailers and shops that they were purchasing originals,” Italian intellectual property attorney Silvia Grazioli of Bugnion SpA stated in connection with one of Supreme’s cases against Supreme Italia-creator IBF.
While a seemingly inevitable side effect of the strictly limited-edition product strategy that dominates the streetwear/skatewear space is a thriving market for counterfeit goods, brands like Stussy and Supreme have taken to litigation to protect their valuable indicators of source, with Stussy somewhat consistently filing trademark-centric lawsuits dating back to at least 2000, and Supreme’s corporate entity Chapter 4 Corp., on the other hand, escalating its fight against fakes in recent years by way of a growing number of suits filed in the U.S. beginning in 2018.
A rep for Shein was not immediately available for comment in response to the Stussy lawsuit.
The case is Stussy, Inc. v. Shein Corp., 8:22-cv-00379 (C.D.Cal.).
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