11 Oct

A “spectacular outcome” for H&M as Dutch Supreme Court rules in decades-long dispute with adidas

  • Dutch Supreme Court rejects adidas appeal in dispute over H&M’s two stripes mark
  • Attorney representing H&M describes conclusion as “spectacular outcome”
  • adidas says it is disappointed in decision, will continue to use legal means to protect its mark

The Dutch Supreme Court has rejected an appeal by adidas, ending a decades-long dispute with H&M Hennes & Mauritz over its use of a two-stripe mark.

The dispute stretches back to 1997 and focuses on H&M’s use of a two-stripe mark. adidas had previously been the beneficiary of victories based on its three stripe marks at the District Court of The Hague in November 2017 and the Arnhem-Leeuwarden Court of Appeal in January 2018. For its part, H&M argued that such a “blanket ban on the use of two stripes was an unreasonable restriction” and the dispute continued at appeals level.

On 28 January 2020, the Court of Appeal of The Hague ruled that H&M can use a specific two-stripe sign (as part of its ‘Work Out’ clothing line) on its sports clothing without infringing the three-stripe trademark of adidas. That decision hinged on the scope of protection of adidas’ three-stripe mark, which is defined by the spacing between the stripes in relation to the width of the stripes. H&M’s sports clothing was deemed to fall outside the scope of adidas’ infringement claim, because the spacing between the two stripes was smaller to a relevant extent than the stripes themselves.

Specifically, adidas opposed the use of a motif consisting of two vertical and parallel stripes of equal width, placed at equal distance from each other, where the spacing between the stripes was visually more or less equal to the width of the stripes. The Court of Appeal of The Hague held that the condition that the spacing between the stripes was visually more or less equal to the width of the stripes was not met.

It also assessed whether there was a likelihood of confusion between H&M’s two-stripe sign and adidas’ three-stripe mark. In that analysis, it held that H&M’s two-stripe sign and adidas’ three-stripe mark were similar only to a very low degree. Further, the court did not deem the claim relating to a trademark with a reputation to be assignable.  Important in this analysis was survey evidence submitted by H&M, which countered adidas’ consumer survey results on consumer confusion by highlighting the market leader effect (which means that,  because adidas is a market leader in sportswear, a certain percentage of respondents will answer ‘adidas’ in any case when asked about the origin of a piece of sportswear).

That led to an appeal by adidas to the Dutch Supreme Court, which on Friday handed down its judgement (ECLI:NL:HR:2021:1474). Its conclusion was that the complaints about the judgment of the Court of Appeal “cannot lead to the annulment of that judgment”, with the Supreme Court not required to substantiate why it has reached this decision. It added: “In assessing these complaints, it is not necessary to answer questions that are important for the unity or development of the law (see Article 81 paragraph 1 of the Judicial Organization Act).” Thus it rejected the appeal and ordered adidas to pay the costs of the cassation proceedings, estimated on the part of H&M at €23,000 until this judgment, plus statutory interest on these costs if these are not paid for 14 days.

Speaking to WTR,  Gino van Roeyen, attorney-at-law at LAWNCH – who has represented H&M in the case since 1997 – characterised the decision of the Supreme Court as “a spectacular outcome and one that is good to receive after almost 25 years.” He added: “The Supreme Court rejected adidas’ appeal in cassation on the ground that it could clearly not lead to cassation, which was the reason why the appeal was dismissed without providing detailed reasoning. The Court of Appeal had looked carefully at the evidence and the crux of the matter was in the interspace between the two stripes sign as used by H&M in its 1997 Work Out collection, which was found not to be encompassed in the claims as filed by adidas in this case. The court conclusion was favourable to H&M as it found a clear evidence of a different configuration on that interspace in view of the claims.”

In a statement supplied to WTR adidas said: "adidas is disappointed by the 8 October decision of the Dutch Supreme Court which dismissed the appeal which adidas had filed against the earlier Court of Appeal’s decision which ruled that use of a particular two-stripe marking on H&M apparel did not infringe adidas’ well-known three-stripe mark. The decision is surprising given three lower court decisions in this case, which all confirmed infringement of adidas’ three-stripe trademark. The three-stripe trademark of adidas has been used consistently for many years on adidas apparel products and is highly distinctive. It is well-known worldwide. adidas will continue to use and promote the three-stripe trademark extensively, in order to further enhance the distinctiveness and reputation of the mark. Meanwhile, adidas will continue to use legal means provided by relevant laws including trademark law and anti-unfair competition law to protect its legitimate rights."

Trevor Little

Author | Editor

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Trevor Little