Milan Fashion Week and Fashion Law Trends: How Fashion Brands Can Promote Sustainability While Protecting Their Brands

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For the last article in our fashion law section, we wanted to talk to you about one of the biggest trends of the moment: vintage and second-hand.

The fashion industry is the second largest polluter in the world after the oil industry and is responsible for 10% of all carbon emissions of humanity. These daunting numbers can be drastically reduced by tapping into vintage and second-hand needles. Indeed, the attempt to extend the life of clothing and accessories that have already been launched on the market is rapidly gaining momentum.

Upcycling consists of transforming pre-existing clothes, accessories, bags and fabrics into new products: it reduces waste and promotes creativity, and it has been recognized by Vogue as the biggest fashion trend of 2021.

There are several examples of upcycling in the fashion industry today. For example, in 2019, Arc’teryx launched a re-commerce program called Rock Solid Used Gear, consisting of the brand buying back used gear, cleaning and repairing long-life products, and resale of items at lower cost. Several other brands, such as Levi’s, North Face, Eileen Fisher and Patagonia, are now embracing upcycling in order to keep their used branded products in circulation longer and to tap into the growing segment of the resale market.

Another example of the sustainable adoption of circularity comes from Farfetch, the largest online luxury fashion retail platform, which announced in 2021 a collaboration with The Restory, a company providing modern tracking for fashion. luxury, creating Farfetch Fix (Farfetch Fix offers consumers “custom repairs to restore your designer shoes, handbags and small leather goods to their former glory”).

Given the examples above, it seems that most efforts focused on circularity come either from brands buying, revamping and reselling products bearing their name, or from third parties – such as Farfetch or The RealReal through a “suite of repair services” – which refurbish designer clothing and accessories without the involvement of the underlying brands.

While these efforts serve the same purpose of extending product life, one must recognize the difference between brand-authorized repair/resale scenarios and those performed independently by third parties. In fact, several lawsuits have shown that the tendency to modify or refurbish branded products and then sell them without the authorization of the original trademark owner or without properly informing consumers of the modifications can have serious implications. legal – this happened recently. in the case Chanel brought against What Goes Around Comes Around.

This raises a difficult question for brands: how can you promote eco-friendly upcycling while protecting your brand?

By registering the trademark, the holder obtains exclusive rights to it, i.e. the right to use his sign exclusively and to prevent its use by unauthorized third parties.

However, several jurisdictions allow the resale of a trademarked product once the trademark owner has placed that product on the market (in the US legal system this is called the “first sale doctrine”, while that in the European system it is the “principle of exhaustion”).

Nevertheless, it should be pointed out that the doctrine of first sale does not apply when the material state of the product has changed after its first sale (article 5 of the Italian Industrial Property Code), which consumers might believe have been authorized by the trademark owner. Therefore, if the process of refurbishing or repairing the product results in a material change to that product, the first-sale doctrine is unlikely to find application.

In light of the above, some services – such as re-trimming shoes, cleaning leather bags, or mending damaged seams on clothing or accessories – are not likely to conflict with the app. correctness of the first sale doctrine, thereby allowing a third party to provide such services. services without the need for the brand owner’s approval. On the contrary, when the third party intervenes on the products of the brand by permanently altering them, then resells them, the doctrine of the first sale does not apply.

However, according to article 21 of the Italian Code of Industrial Property, platforms offering repair and refurbishment services of branded products are free to advertise their services without risking infringing the trademarks of the brands. .

Given the different application of the first-sale doctrine depending on whether the change is tangible or intangible, and due to the continued expansion of the resale market – capable of making second-hand luxury goods more affordable and more easy to access – some brands have complained that their branded products are repackaged and then sold without their consent, thus preventing them from controlling and ensuring an excellent level of quality of these products.

Therefore, it is possible to anticipate potential problems when unauthorized third parties materially alter genuine products that enter the market in resale quality, thereby generating consumer confusion as to the origin of the products – particularly when the dealer is not aware of the changes. made to the goods, thus omitting to mention them in the list of goods.

According to a 2019 fashion industry report from McKinsey, product modification issues are likely to continue because “the life of fashion products is being extended as used, refurbished, repaired and rental business models continue to evolve», and particularly as consumers «demonstrate a desire to move from traditional ownership to new ways of accessing the product”. Therefore, the implementation of resale models and the transition to circularity will require a careful balancing of the interests at stake, namely the interests of brand owners, actual or potential competitors in secondary markets, consumers and the society.

Faced with an upcycler counterfeit, a brand still has ways to deal with the diversion without involving the Courts. For example, “informal enforcement” through demand letters, B2B discussions, or takedown requests can help remedy the breach. Trademark owners should engage the services of a trusted intellectual property attorney to develop an enforcement plan based on the facts of the specific infringement at issue.

On the other hand, brands can protect themselves from third-party abuse by proactively producing their own recycled products. IP consultants could additionally help brands establish recycling partnerships and product streams, also through licensing agreements, merchandising agreements, co-branding agreements and other contractual arrangements. .

By participating in the circular economy, fashion brands can contribute to sustainability by properly monitoring their brands downstream.

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