GLORIA VANDERBILT licensing ruling released

In Netherby Ltd v Jones Apparel Group Inc, 2007 WL 104648 (SDNY April 5 2007), the US District Court for the Southern District of New York has ruled on a dispute relating to a licensing agreement involving the Gloria Vanderbilt brand and related marks. The plaintiff, Netherby Ltd, owns the GLORIA VANDERBILT trademark for clothing, as well as certain other marks associated with Gloria Vanderbilt. In 1988 Netherby licensed to the defendants, Jones Apparel Group Inc and Jones Investment Co Inc, the ability to use a number of marks that were expressly identified by the licence. Critically, however, the licence also covered "any other mark associated with Gloria Vanderbilt".

Several years after their entry into the licence, the defendants introduced a line of children's clothing under the GLO BY GLORIA VANDERBILT mark, which they registered with the US Patent and Trademark Office. The line was on the market for only nine to 10 months and, although the defendants subsequently sub-licensed use of the GLO GLORIA VANDERBILT mark in Canada, use of GLO in conjunction with GLORIA VANDERBILT was discontinued by 2000.

Instead, the defendants began using GLO as a standalone mark for denim clothing. In promoting their new line, however, they took a number of steps apparently calculated to invoke the goodwill associated with their past and ongoing use of the GLORIA VANDERBILT mark. For example, their press releases contained such statements as "Gloria Vanderbilt adds a spark to the hot junior market with the launch of its new line, GLO" and "Gloria Vanderbilt has made its mark as one of America's first mega brands in designer jeans. In 2001, GLO will add a youthful, sassy and carefree look for a young audience". The defendants also promoted GLO and GLORIA VANDERBILT clothing on a side-by-side basis through a website prominently labelled 'GLORIA VANDERBILT'.

Maintaining that the GLO mark was "associated with Gloria Vanderbilt" within the meaning of the licence, Netherby filed suit to recover royalties it claimed were due from the defendants. Following a bench trial, the court agreed that the defendants' use of the GLO mark was governed by the licence. Although the defendants claimed that they had carefully maintained a distinction between the GLO and GLORIA VANDERBILT marks because goods bearing them were sold to entirely different markets, the court was unconvinced. On the contrary, it found:

"Defendants' Glo mark ... is 'associated with' Gloria Vanderbilt for purposes of the ... [licence]. The court rests this conclusion on a combination of factors, including (i) the fact that GLO consists of the first three letters of Gloria Vanderbilt; (ii) defendants' registration and use of the mark GLO BY GLORIA VANDERBILT; (iii) the press releases announcing the launch of the GLO line in 2001, in which defendants unambiguously linked GLO to the GLORIA VANDERBILT trademark, brand and person; (iv) the close pairing of Glo jeans and Gloria Vanderbilt jeans on the Gloria Vanderbilt website for several years; (v) the connections drawn between GLO and the Gloria Vanderbilt brand in both trade and mainstream publications; and (vi) concessions by [the principal of one of the defendants] that his company sought to capitalize on the recognition of the Gloria Vanderbilt brand in launching the GLO line."

Although obviously dependent on the facts before the court, this outcome demonstrates in graphic fashion the potential perils of reliance on ambiguous documents, particularly for parties whose conduct lends itself to having those ambiguities resolved against them.

Theodore H Davis Jr, Kilpatrick Stockton LLP, Atlanta