Intellectual Property Rights Analysis of Christian Louboutin’s Bullet Shaped

Chloe Barker

Katie Kruisselbrink

Madison Kuczynski

Texas A&M School of Law

2020

1 Abstract

Overtime, the industry has revolutionized not only the demand for cosmetics, but the product design, how the products enter the marketplace, and created a sort of hierarchy with general store-bought cosmetics at the bottom and luxury cosmetics at the top, often determined by the brand and the price of the products. Infamously known for its “” shade first entering the marketplace on the soles of shoes, Christian Louboutin has expanded from the fashion industry to the , presenting cosmetic products for the lips, nails, and eyes, available in not only the “Rouge” shade, but many others. With reference to the revolutionized industry, there is a heavy influx of brands creating a strongly competitive market. With the use of patent protection, many brands are now turning their cosmetic creations into intellectual property to receive the protections that come with that status. Louboutin’s creation of the bullet-shaped is a prime example of turning a cosmetic item into a “work of art” which exudes the probative presence of design protection. While not every brand can profit from the creation and costs of introducing such an “edgy” product, Louboutin’s entrance into the cosmetic industry serves as a key example of the competitive advantage that follows luxury brands, especially in the highly competitive cosmetic industry. This level of competition often results in the issue of counterfeits, which in the cosmetic industry, often provide vast negative impacts. The most counterfeited items are those produced by luxury brands, such as Louboutin. Through strategic business management and introduction in the market coupled with the brand’s luxury status, a brand such as Louboutin is ensured success.

2 Table of Contents I. THE COSMETICS MARKET AND THE PRODUCT AT ISSUE: LOUBOUTIN’S LUXURY LIPSTICK ...... 4 (A) GENERAL DESCRIPTION OF THE RELEVANT MARKET OF LUXURY COSMETICS ...... 4 (B) CHRISTIAN LOUBOUTIN’S BRAND RECOGNITION FOR SHOES ...... 5 (C) THE EXPANSION IN THE LUXURY COSMETICS MARKET ...... 7 (D) LOUBOUTIN’S EXPANSION INTO THE LIPSTICK MARKET ...... 7 II. PROCESS OF PROTECTION ...... 9 (A) THE IMPORTANCE OF IP RIGHTS FOR LOUBOUTIN LIPSTICK ...... 9 (B) IP PROTECTION FOR COSMETICS: NATIONAL (AND REGIONAL) REVIEW ...... 11 (1) United States’ Existing IP Protection for the Louboutin Lipstick ...... 11 (2) The European Union’s IP Rights ...... 18 (3) China’s IP Rights ...... 21 III. MANAGEMENT OF INTELLECTUAL PROPERTY ASSETS OF THE PRODUCT AND BUSINESS ...... 27 (A) STRATEGIES IN MARKETING: INFLUENCERS, ADVERTISING, AND SOCIAL MEDIA ...... 27 (B) LOUBOUTIN’S HISTORY OF ENFORCEMENT ISSUES ...... 28 IV. CONCLUSION ...... 30

3 I. THE COSMETICS MARKET AND THE PRODUCT AT ISSUE: LOUBOUTIN’S LUXURY LIPSTICK

(A) General Description of the Relevant Market of Luxury Cosmetics

Protecting one’s ideas and creations is the and priority of intellectual property laws. Intellectual property law creates an advantage via protection where there is novelty, originality and creation. As for a business, protecting intellectual property heightens the market value of the business through licensing, sale and commercialization, turns mere ideas into profit-making assets, and provides brand recognition via trademarks and geographical indications. 1 The global cosmetics industry is worth over $500 billion.2 Millennials are the biggest cosmetic shoppers and spend the most—on average 25% more than other shoppers.3

The first metal lipstick tube was patented in 1917 by inventor William Kendall.4

A basic lipstick tube, lipstick packaging has developed into far more complex designs. Now, each brand has its own unique packaging that allows consumers to identify a brand of lipstick just by

1 Intellectual Property: the basics, NI BUSINESS INFO (last accessed September 25, 2020) https://www.nibusinessinfo.co.uk/content/advantages-protecting-intellectual- property#:~:text=There%20are%20many%20advantages%20to,of%20protected%20products%20or%20services. 2 Cosmetic Industry Design Patents, INQUARTIK (last accessed August 30, 2020) https://www.inquartik.com/inqr- cosmetic-industry-design-patents/. 3 Theresa Avila, I’m About to Spend $90 on a Lipstick. Here’s Why That Might Actually Make Sense, MIC (Aug. 12, 2015) https://www.mic.com/articles/123672/i-m-about-to-spend-90-on-a-lipstick-here-s-why-that-might-actually- make-sense. 4 Cosmetic Industry Design Patents, supra note 2.

4 its component by using thematic colors, different exterior textures, mirrors, and as we will detail further here, changing the exterior to resemble a specific item.5

The lipstick market alone is valued at $13.1 billion.6 The classic lipstick tube is the most common type of applicator but in recent years, liquid lipsticks have risen in popularity.7 Lipsticks are often divided by the finish of the lipstick: matte, glossy, lip powder, etc.8 Some key players operating in the lipstick market include L’Oreal, Estee Lauder, , Christian Dior, and MAC.9 Some of the most popular retailers for luxury lipstick include , Nieman Marcus, Nordstrom, and Saks Fifth Avenue. Lipstick prices can range from just a few dollars to $62,000 for ’s lipstick because the tube is made of gold and diamonds.10

(B) Christian Louboutin’s Brand Recognition for Shoes

Christian Louboutin is most known for its iconic—and expensive—red outer-sole shoes. The red soles made Louboutin stand out among luxury brands. Christian Louboutin wanted to create a shoe that empowered women and came upon the idea for the red bottom shoes while watching his assistant paint her nails red.11 The color red is bold and sexy, and from there, the shoe gained popularity.12 Jennifer Lopez even released a song specifically about Louboutin in 2009. Possibly the most influential example is Carrie Bradshaw (Sarah Jessica Parker) in Sex and the City, with her bold fashion choices and devotion to her Louboutin shoes. The show and movies received enormous attention where Bradshaw served as a style icon to the viewers and wore Louboutin’s in many episodes. Louboutin now sells over 700,000 pairs of shoes a year13.

5 See Nicola Dall’Asen, 25 lipsticks we’d buy just based on the beautiful packaging, REVELIST (Aug. 16, 2017) https://www.revelist.com/makeup/lipstick-packaging/8885/paul--joe-pearl-lipstick/1 6 Lipstick Market Size, Share & Trends Analysis Report By Product (Shimmer, Matte), By Applicator, By Age, By Distribution Channel, By Region, And Segment Forecasts, 2019 – 2025, GRAND VIEW RESEARCH (July 2019) https://www.grandviewresearch.com/industry-analysis/lipstick-market. 7 Id. 8 Lipstick Market by Product Type (Matte, Glossy, Lip Powder, and Others), Form (Stick, Liquid, and Palette), and Distribution Channel (Supermarkets/Hypermarkets, Specialty Stores, and Online Stores): Global Opportunity Analysis and Industry Forecast, 2019–2026, ALLIED MARKET RESEARCH (Dec. 2019) https://www.alliedmarketresearch.com/lipstick-market. 9 Id. 10 Allie Flinn, 11 Weird But True Facts About Lipstick, BYRDIE (Dec. 19, 2018) https://www.byrdie.com/crazy- lipstick-facts 11 The Secret Behind the Red Soles of Christian Louboutin, CATAWIKI (last accessed September 15, 2020) https://www.catawiki.com/stories/4533-the-secret-behind-the-red-soles-of-christian-louboutin. 12 Id. 13 Y-Jean Mun-Delsalle, Q&A With Christian Louboutin, the French King of Sole, FORBES (Fe. 25, 2016) https://www.forbes.com/sites/yjeanmundelsalle/2016/02/25/qa-with-christian-louboutin-the-french-king-of- sole/#49f7c0bb271f.

5

In addition, the brand has entered many collaborations as part of their strategy to further endorse its products. For example, in 2012, Disney commissioned Louboutin to create a pair of shoes inspired by Cinderella slippers. These truly one-of-a-kind shoes were limited in pairs and were used to endorse the re-release of Cinderella the Diamond Edition.

In today’s modern-era, Louboutin strategically entered the technological market with the creation of Louboutinize, an easily downloadable application. Using their fortune and status to their advantage, Louboutin launched their app in 2012 to aid users in finding stores, saving products to a wish list, viewing the latest commercials/advertisements, access to new seasonal collections, and providing the user with the history of Louboutin products.

6 (C) The Expansion in the Luxury Cosmetics Market

Because of its famous shoes, the Louboutin brand has an unequivocal high status and competitive advantage in the luxury market. This has allowed Louboutin to successfully introduce related products, particularly in the beauty industry.

Louboutin first entered the cosmetic industry with its nail lacquer collection, which is a tactical market introduction because the original red bottom shoes were originally inspired by an assistant’s red , making this a wise related product. Another distinguishing factor about Louboutin’s nail lacquer is that, similar to its famous shoes, it commands a considerably higher price than even other luxury brands (such as YSL, Givenchy, Dior and Armani), making it the most expensive nail lacquer in the market.14 Louboutin’s nail lacquers were marketed in thirty different shades. Yet, the signature one is, not surprisingly, the red lacquer, “Rouge Louboutin”, which allows the wearers to match their nails to their shoes.15 In other words, Louboutin could easily align the design and desire of its new product with Louboutin’s reputation of confidence, power, and sex-appeal (often referred to the “brand promise”) of its iconic shoes. As illustrated in the picture below, the shape of the lacquer container itself is inspired by the heel of the shoe.

(D) Louboutin’s Expansion into the Lipstick Market

In 2015, Louboutin introduced its first eye-catching lipstick line inspired by Queen Nefertiti and the Art Deco movement, taking the shape of a bullet and enclosed with a crown cap including a

14 Marion, Christian Louboutin enters the make-up industry with a nail polish line, THE BRANDING JOURNAL (Aug. 4, 2014) https://www.thebrandingjournal.com/2014/08/christian-louboutin-enters-make-industry-nail-polish-line/. 15 Id.

7 small ring at the top. The lipstick comes in 38 shades each inspired by the brand’s shoes and bags and three different textures—Silky Satin, Velvet Matte, and Sheer Voile.16 At $90 for a single lipstick, these lipsticks certainly fall into the luxury category and are well above the average $35 price tag for luxury lipsticks.17 Louboutin’s lipsticks can be purchased from a variety of retailers such as Sephora, Neiman Marcus, Nordstrom, Saks Fifth Avenue, and Louboutin’s own website.

Generally, lipsticks are made using a combination of wax, oils, and pigment.18 According to Sephora, a retailer owned by Louis Vuitton Moet Hennessy19, the ingredients on the Louboutin velvet matte lipstick include various types of silicone, coffee, seed oil, cotton, various waxes, alcohols, and variations of pigment depending on the color of the lipstick.20 These ingredients are melted down, with the pigment added last, until the batch is free of air.21 Once it reaches this level, the mixture is poured into the component.22 While the lipstick formula is important, people buy Louboutin’s lipstick for its ornate and luxurious packaging more than the formula itself. Millennials, as the biggest spenders in the industry, spend the most time on social media creating an online presence, and thus it makes sense that Louboutin would care about beautiful packaging, enticing others to want what people on social media have.23

16 Alexandra Tunell, Christian Louboutin Created the Most Glamorous Lipstick Ever, HARPER’S BAZAAR (Aug. 5, 2015) https://www.harpersbazaar.com/beauty/makeup/a11718/christian-louboutin-lipstick/. 17 Meghan Overdeep, Watch: You’ll Never Believe How Little It Costs to Make a Tube of Lipstick, SOUTHERN LIVING (June 4, 2018) https://www.southernliving.com/news/what-it-costs-to-make-lipstick 18 Liesa Goins, What’s in Lipstick?, RADIANCE BY WEBMD (last accessed Sept. 10, 2020) https://www.webmd.com/beauty/features/makeup-decoding-lipstick. 19 Walter Loeb, Sephora: Department Stores Cannot Stop its Global Growth, FORBES (Apr. 18, 2013) https://www.forbes.com/sites/walterloeb/2013/04/18/sephora-department-stores-cannot-stop-its-global- growth/#76ae08452e81. 20 https://www.sephora.com/product/velvet-matte-lip- colourP400560?skuId=1750140&icid2=products%20grid:p400560:product. 21 Lipstick, HOW PRODUCTS ARE MADE (last accessed Sept. 15, 2020) http://www.madehow.com/Volume- 1/Lipstick.html 22 Id. 23 Avila, supra note 3.

8 The container itself was designed to be beautiful yet utilitarian and can even be worn as a necklace.24

It is common knowledge that the makeup industry has flourished in the past ten to twenty years, with the introduction of numerous new high-end brands, many of which are very successful despite their products costing significantly more than average. Because of this success, luxury brands like Louboutin can project to achieve significant sales, and at the least, reach above the break-even point. Second, in routine with the unfamiliar and distinctive design of the nail lacquer, Louboutin achieved the same distinguishing factor with the design of the bullet shaped lipsticks.

In line with Louboutin’s future success in the cosmetics industry, in 2018, Puig and Christian Louboutin entered into a long-term licensing agreement under the Louboutin brand for the design, development, and distribution for Louboutin’s beauty line, while Christian Louboutin retains the IP rights.25

II. INTELLECTUAL PROPERTY PROTECTION

(A) The Importance of IP Rights for Louboutin Lipstick

With the heavy influx of new types and brands of cosmetics and fashion designers and celebrities moving from their own creative industries into the cosmetic world, the competition to create the best and most unique products has increased. Cosmetics are no longer simple and basic—they have become their own works of art, from their colors, to their shapes, ingredients, formulas, and even their packaging. With this increased competition comes a need to secure and protect one’s brand and products, which is why in recent years, creators have begun to turn their cosmetic creations into intellectual property and apply for the protections that come with that status.

24 Sharon Clott Kanter, Christian Louboutin Wanted to Create Lipsticks So Pretty They’re “Begging to be Stolen”, INSTYLE (Aug. 14, 2015) https://www.instyle.com/news/christian-louboutin-lipsticks-interview-so-pretty-theyre- begging-be-stolen. 25 https://www.puig.com/en/brands/christian-louboutin/.

9 In particular, when entering the international market, the first step is to file for protection in every country they wish to do business outside of their country of origin.26 With this, it is especially proactive for a business to file for protection in countries where copying may be common to ensure protection from the issues that could arise.27 By taking this step, brands place themselves at an advantage to quickly remove any counterfeit threats. As for luxury brands, who often have the majority of counterfeit issues due to scarcity of products and high prices, protection in countries where counterfeits may be an issue is a necessary element in their business strategy.

When it comes to its lipstick, Louboutin seems to have focused less on the formula, ingredients, and color of the lipstick, and more on creating a product packaging unlike any other.28 In particular, it does not appear that Louboutin has filed any patents (from our extensive research) directly or on behalf of the company for the actual lipstick formula and chemicals. However, we do not address the possible IP rights in the actual lipstick chemical components in this paper, due to this lack of information. Instead, we address the protection related to the trademark, design and shape of the products.

As illustrated in the images in this paper, Louboutin took great care to ensure that its lipstick packaging was distinguishable from other brands in the market. In addition, Louboutin carries several different shades of lipstick, all of which come packaged in one of three different unique containers with beautifully intricate lids—either a smooth gold container with scales at the bottom, a smooth black container with scales at the bottom tip, or a black container fully decorated with the scales.29

Because of the intricate and unique design of the bullet shaped lipsticks, Christian Louboutin protects the design of the packaging in the United States, the European Union Intellectual Property

26 https://www.trade.gov/protect-intellectual-property. 27 Id. 28 As is evidenced by its lack of trademarks, copyrights, and patents on formula. 29 Louboutin Homepage, http://us.christianlouboutin.com/us_en/shop-online-3/beauty/lips.html (last accessed Oct. 1 2020).

10 Office (EUIPO), Canada, Malaysia, China, and other countries.30 In particular, Louboutin holds registrations for the lipstick in a variety of aspects including the different lids, parts, and overall shape of the container.31

Below are the United States’, European Union’s, and China’s existing IP rights for the Louboutin lipstick. We chose to analyze Louboutin’s IP protection in these countries because they are currently amongst the largest and most relevant markets in terms of sale volumes for the company. Lastly, this paper addresses Louboutin’s issue concerning IP infringement claims and counterfeit products for the lipstick in the US, EU, Russia and China.

(B) IP Protection for Cosmetics: National (and Regional) Review

At the outset, we should repeat that the makeup industry can protect lipsticks with a variety of IP rights. These include patents, design patents or industrial design, trademarks, copyright, and unfair competition or passing off.

However, for a company to successfully apply for patent protection for its cosmetic, it must disclose all the various steps that are involved in making the specific product, or the parts of the products for which protection is sought.32 This disclosure includes the specific ingredients and compounds that go into making the cosmetic product. It is thus not surprising that many companies can be resistant to follow through with the patent process because of the necessary disclosures and prefer, instead, to protect their manufacturing process, and other relevant parts of their business process, with .33

As mentioned above, in this paper we do not analyze the possible protection of the Louboutin lipstick via patents nor trade secret due to the lack of relevant information on these aspects of the products. Any analysis in this respect would be based on necessary speculation, and thus would not be truly meaningful for the project. Instead, we focus on the existing protection for the product packaging in the three countries, or regions, that are analyzed in this Part: the US, the EU, and China.

(1) United States’ Existing IP Protection for the Louboutin Lipstick

Design Patents

In general, an applicant can obtain a design patent in the US for the if the appearance and design of the packaging are found to be new and unique.34 Christian Louboutin has three design patents in the US that are specifically for the lipsticks.35 Notably, these design patents are for the unique containers/packaging, including the pointed bottom and crown shaped

30 WIPO IP Portal, GLOBAL DESIGN DATABASE, https://www3.wipo.int/designdb/en/index.jsp#. 31 Id. 32 Noah Adam, Patent Rebel, https://patentrebel.com/can-cosmetics-be-patented/. 33 Id. 34 Id. 35 WIPO Global Design Database, supra note 30.

11 top, which are inspired from the profile and accessory of Egyptian queen Nefertiti as mentioned previously.36 Louboutin is known to sell its lipstick in trios on chains to form a necklace.37 However, the necklace design is not patented. Based on existing literature, there may be a question as to whether someone else owns the rights to this or a similar design.38

Below are pictures with the design patents that have been granted to Louboutin in the United States for its lipstick packaging.39

36 Id. 37 Saks Fifth Avenue, https://www.saksfifthavenue.com/christian-louboutin-rouge-louboutins-lip-color- trio/product/0400096280253 (last accessed Oct. 1, 2020). 38 Justia Patents, Lipstick Necklaces (Jul. 6, 2010) https://patents.justia.com/patent/20110072850. 39 Id.

12

Trademarks

In the United States, Louboutin has three registered logo trademarks (see picture below) for cosmetics. This includes protection for the lipsticks, lip-glosses, perfume, nail polish, eye makeup,

13 bath products, and skincare.40 The first two marks were registered in 2010 and the third one was registered in 2017.41 The first registration is for the full name “Christian Louboutin” in its classic scripted font that are model after the iconic signature of the designer. The second registration is the brand’s full name “Christian Louboutin” in bold capital letters. The last registration is for the “CL” initials in scripted font.42

Figure 1

Figure 2

40 USPTO, Trademark Search, http://tmsearch.uspto.gov/bin/showfield?f=doc&state=4808%3Aiyletn.2.1. 41 Id. 42 Id.

14 Figure 3

A comprehensive search through the US trademark database did not find any specific registration for the bidimensional or 3-d shape of the container or cap. However, as we elaborate below, these shapes can be protected as non-registered trademarks in the US.

Unregistered Trademarks and Trade Dress

The United States provides protection against unfair competition practices, such as actions that cause economic injury to a business through deceptive or wrongful business practices. Thus, even though Louboutin did not register the specific shape of its lipstick packaging in the US, Section 43(a) of the Lanham Act protects these shapes as unregistered marks as they are distinctive of the Louboutin’s products43 and have certainly acquired secondary meaning.44 Accordingly, Louboutin could bring an infringement claim even though its trade dress is unregistered and could succeed if the infringing products created a likelihood of confusion.45 Moreover, based on the notoriety of the Christian Louboutin mark, the mark itself and the famous color used on many of the products could suffice to show that the item has become famous and thus can also be protected beyond the

43 See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 (1992) (“[I]t is common ground that § 43(a) protects qualifying unregistered trademarks”); see also Matal v. Tam, 137 S. Ct. 1744, 1752 (2017) (“[E]ven if a trademark is not federally registered, it may still be enforceable under § 43(a) of the Lanham Act, which creates a federal cause of action for trademark infringement.”). 44 Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529 U.S. 205 (2000). Trademark Manual of Examining Procedure October 2018, 1212 Acquired Distinctiveness or Secondary Meaning, TMEP (Oct. 2018), https://tmep.uspto.gov/RDMS/TMEP/current#/current/TMEP-1200d1e10316.html. 45 New West Corp. v. NYM Co. of California, Inc., 595 F.2d 1194, 1201 (9th Cir. 1979).

15 likelihood of confusion.46 Below is an example of the trademarked red-bottom shoes and the Christian Louboutin logo.47

Copyright

Copyright protection attaches regardless of whether the work is registered as a copyright or receives other IP protections, regardless of the nationality or domicile of the creator. From a search in the Copyright Registry, there are no registered copyrights for Christian Louboutin. As copyright law provides protection for original works of authorship and creative designs, the lipstick design is protected as an original work of authorship in the category of pictorial, graphic, and sculptural works.48 Copyright protection lasts for the life of the author plus an additional 70 years.49

However, under US law, copyright only protects features that can be separately identified from and exist independently of a useful article. Within a design, there are certain materials that cannot receive protection, such as material that was previously published, material that was previously registered, material that is in the public domain, and/or material that is owned by an individual or

46 For example, see Nirvana, LLC v. Marc Jacobs International, LLC, No. LA CV18-10743, 2019 WL 7817082 (C.D. Cal. 2019) (holding that due to Nirvana’s fame, frequent use of the smiley face, and likelihood of confusion using the mark, Marc Jacobs could not use their smiley face); see also Lions Gate Entertainment, Inc. v. TD Ameritrade Services Company, Inc., 170 F.Supp.3d 1249 (C.D. Cal. 2016) (holding that the TD Ameritrade advertisement was not likely to cause confusion as to the actual producer of the tangible product sold in the marketplace. Further, the type of the non-rivals goods or services is one of the factors observed when deciding if there is a likelihood of confusion). 47 For case law regarding the red sole, see Christian Louboutin S.A. v. Yves Saint Laurent Am. Holding, Inc., 696 F.3d 206 (2d. Cir, 2012) (holding that Christian Louboutin’s red outsole trademark was valid and enforceable, and that such trademark protection was limited to uses in which the red outsole contrasts with the color of the remainder of the shoe. Therefore, Yves Saint Laurent was not prohibited in using a red sole as part of a monochrome red shoe). 48 Copyright Law of the United States and Related Laws Contained in Title 17 of the United States Code, CIRCULAR 92 (June 2020), https://www.copyright.gov/title17/title17.pdf. 49 Copyright.gov, How Long Does Copyright Protection Last?, https://www.copyright.gov/help/faq/faq- duration.html (last visited Oct. 1, 2020).

16 legal entity other than the claimant who is named in the application.50 Since 2017, however, US case law has expanded copyright protection for fashion related items with the case Star Athletica, LLC v. Varsity Brands, Inc.51 The case expanded the previous position related to the design elements that can be protected based on whether a design of a useful article can be identified separately from and capable of existing independently of the utilitarian aspects of the article. In particular, following Star Athletica, there is no longer need to distinguish between conceptual and physical separability and the design of a useful article is eligible for copyright protection if the feature: (1) can be perceived as a two or three dimensional work of art separate from the useful article and (2) would qualify as a protectable pictorial, graphical, or sculptural work either on its own or in some other medium if imagined separately from the useful article.52

Accordingly, the Louboutin lipstick packaging can receive protection as a sculptural work and its use as a necklace can also be protected because both satisfy the current tests. This conclusion is additionally supported by Silvertop Associates v. Kangaroo Manufacturing where the court held that although a design uses elements that might in and of themselves not be protectable alone, the design, considered as a whole, is separable and eligible for protection.53

Overall Protection in the United States

In conclusion, Louboutin lipstick enjoys protection in the US in the form of design patents, registered and unregistered trademarks, and copyright. These protections can also overlap allowing the company the possibly to enforce the separate rights at the same time, especially useful in case of infringing products or counterfeits. For example, a lawsuit for infringement of the design,

50 Help: Limitation of Claim, COPYRIGHT.GOV (last visited Oct. 1 2020) https://www.copyright.gov/eco/help- limitation.html. 51 Star Athletica, LLC v. Varsity Brands, Inc., 137 S. Ct. 1002 (2017). 52 Id. 53 Silvertop Associates Inc, v. Kangaroo Manufacturing Inc., 931 F.3d 215 (3d. Cir. 2019).

17 trademark, and/or copyright if the packaging and its use are copied by another company, individual or entity.

(2) The European Union’s IP Rights

Industrial Design

In the EU, members may seek protection in the form of industrial designs, trademarks including protection of unregistered trademarks and unfair competition, copyright, and extended protection due to possible overlap between these rights. In 2002, the EU simplified and harmonized a convenient process to acquire industrial design protection among the members, referred to as the Community Design which offers unitary protection through a single application per Regulation No 6/2002.54 Industrial design rights provide protection of the appearance of a product resulting from attributes such as its shape, colors or materials. 55 For community design protection, Community Design courts and the OHIM are the respective entities who decide whether a design will receive protection under the regulation.56 Accepted applicants are granted exclusive rights to use the design and prevent any third party in the EU for up to 25 years.57 The adopted regulation also allows for protection unregistered designs from deliberate copying under certain circumstances.58 In 2007, the EU also acceded to the Geneva Act of the Hague Agreement, allowing applicants to easily register their design with a single application to the World Intellectual Property Organization, allowing EU companies to receive two forms of protection for industrial design.59 Christian Louboutin is not registered for any designs in the EU for any of its products.60 Although the lipstick is not formally protected, the design still receives protection as an unregistered design from deliberate copying of the product. Although, Unregistered Community Design protection only lasts for three years after introduction to the public.61 Similar to copyright, an overlap of rights is shown here due to the nature of receiving protection and the form of protection from intentional copying of the design. While the design may no longer qualify for the three-year protection term of unregistered community designs, the design will still receive protection under copyright law, which is examined below.

Trademarks

54 European Commission, INDUSTRIAL DESIGN PROTECTION, https://ec.europa.eu/growth/industry/policy/intellectual- property/industrial- design/protection_en#:~:text=Industrial%20design%20rights%20protect%20the,EU%20through%20a%20single%2 0procedure (last visited Oct. 1, 2020). 55 Id. 56 European Commission, Industrial property: Registration of “Community Designs” from 1 April 2003 – frequently asked questions, MEMO/03/77 (Apr. 1, 2003), https://ec.europa.eu/commission/presscorner/detail/en/MEMO_03_77. 57 See supra note 65. 58 Id. 59 Id. 60 Design View, Christian Louboutin, TMDN (last visited Oct. 1, 2020) https://www.tmdn.org/tmdsview- web/welcome#/dsview/results?page=1&pageSize=20&criteria=W&offices=AT,BG,BX,CY,CZ,DE,DK,EE,ES,FI,F R,GB,GR,HR,HU,IE,IT,LT,LV,MT,PL,PT,RO,SE,SI,SK,EM,WO&territories=EU&designerName=Christian%20L ouboutin&indicationOfProduct=louboutin. 61 Design Protection, EUROPEAN UNION, https://europa.eu/youreurope/business/running-business/intellectual- property/design-protection/index_en.htm (last visited Oct. 2, 2020).

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As for trademarks, Christian Louboutin has registered for numerous trademarks, applicable to their cosmetics and other related designs. Below are the few registered with EUIPO and the WIPO.62 Protected under trademark protection, trade dress is the products overall appearance including size, shape, color, texture and graphics. Using trademark protection, the EU allows companies to receive permanent registration of the shape of goods or the packaging of goods to distinguish goods among competitors.63 This form of protection allows for furthered exclusivity of the product.

Unregistered Trademarks and Unfair Competition

While Christian Louboutin has registered the specific trademarks noted above, the company also receives protection for the shapes in the lipstick product as unregistered marks. In the EU, unregistered marks still receive protection against intentional copying. The EU competition laws are designed to promote innovation while also limiting unfair business practices. There are specific rules on agreements that restrict competition with terms on price fixing, market sharing, customer allocation, production limits, and distribution agreements between suppliers and sellers.64 These contracts and agreements are specifically forbidden unless they are justified as benefitting

62 TM View, Christian Louboutin, TMDN, https://www.tmdn.org/tmview/#/tmview/results?page=1&pageSize=20&criteria=C&basicSearch=Louboutin&fOffic es=EM,WO&fNiceClass=3 (last visited Oct. 1, 2020). 63 Cesar J. Ramirez-Montes, The Elusive Distinctiveness of Trade Dress in EU Trademark Law, 34 EMORY INT’L L. REV. 277 (Dec. 10, 2019) https://law.emory.edu/eilr/content/volume-34/issue-1/articles/elusive-distinctiveness-eu- trademark-law.html. 64 Competition rules in the EU, EUROPEAN UNION (Sep. 25, 2020), https://europa.eu/youreurope/business/selling-in- eu/competition-between-businesses/competition-rules-eu/index_en.htm.

19 consumers and the economy.65 The laws also limit large firms and companies from using their bargaining power to impose conditions that would limit their suppliers or customers from doing business with their competitors. The laws also work to curtail misleading information to consumers and aggressive marketing techniques used to influence consumer decisions. The unfair commercial practices directive was initiated to amend the former EU laws on unfair commercial practices from 2005 and works to provide practical examples from case law to limit unfair competition practices.66

Copyright

As for copyright, the EU offers copyright protection without registration. The product must be a literary, scientific or artistic work, allowing automatic protection beginning the moment the work is created, without a formal application process.67 The Cofemel decision held that in order for designs to receive copyright protection, the only requirement that must be fulfilled is the originality requirement.68 Here, originality has two requirements for determining whether a design is a “work” under Cofemel. First, the design must imply the existence of an original object, such as reflecting the personality of the author, manifesting free and creative choices rather than confined by technical formalities, rules or other restraints. The second requirement is that the qualification as a work is reserved for the elements which are an expression of the creation. This second requirement is met where the object can be identified with sufficient precision and objectivity, so that both third parties and authorities can know the protected objects precisely.

Louboutin’s lipstick with its original shape consisting of the bullet-shape, studded crown, and ring on top allowing fun and convenient use as a necklace or other uses, exudes originality and creativity. Here, the lipstick is an expression of the original creation of the design itself, seen in the patents formerly shown in this paper.

65 Id. 66 Unfair commercial practices directive, EUROPEAN COMMISSION, https://ec.europa.eu/info/law/law- topic/consumers/unfair-commercial-practices-law/unfair-commercial-practices-directive_en. 67 Copyright, EUROPEAN UNION (May 8, 2020) https://europa.eu/youreurope/business/running-business/intellectual- property/copyright/index_en.htm#:~:text=Nobody%20apart%20from%20you%20has,a%20work%20of%20joint%2 0authorship. 68 Case C-683/17, Cofemel v G-Star Raw, ECLI:EU:C:2019:721, 12 Sept. 2019.

20 Overall Protection in the EU

An overlap of protection in the EU is the substance of much conversation about how designs are often over-protected. Often, designs are simultaneously protected through design law, trademarks, copyright and unfair competition rules.69 While this over-protection is often scrutinized, designs such as the Rouge Louboutin lipstick with its distinct characteristics, originality, and creative uses, are sufficiently protected in the EU. In many circumstances, qualification for protection of one form results in protection under another.

(3) China’s IP Rights

Design Patents

In China, the patent system covers three different types of patents—the invention patent, the utility model, and the design patent.70 Louboutin has design patents that cover its cosmetic product’s packaging.71 Design patents create protections that last for 10 years from the date of filing.72

China does not have many “trade dress” provisions like other jurisdictions, so protection for aspects like the size, shape, color, structure, pattern, and marketing for products is usually sought through either copyright or design patents.73 Design patents cover the overall shape and style of a product’s packaging, and the product seeking the design patent must comply with “absolute novelty,” meaning that the design has never been publicly published prior to the current patent application.74

Companies are able to file applications with the State Intellectual Property Office (SIPO).75 In order to properly file intellectual property in China, companies must ensure they register both the English name and the Chinese character and pinyin names.76

Louboutin filed two design patents for its lipstick as well as trademarking the “Louboutin” word mark seen on the product. The trademark information is unavailable to access without paying for a subscription to the register,77 however Louboutin filed design patents in 2015 for both the body

69 Cecilia Carli, Design and Trade Dress: The Importance of Appearance; A Comparative Perspective Within Europe and Beyond, IV MALTA L. REV. http://www.elsa.org.mt/wp-content/uploads/2015/02/4.-Carli-Cecilia-Design-and- Trade-Dress-The-Importance-of-Appearance-A-Comparative-Perspective-within-Europe-and-Beyond.pdf. 70 Helika Jurgenson, IP Protection in China for the Cosmetics Industry http://www.youripinsider.eu/ip-protection- china-cosmetics-industry/. 71 Id. 72 Id. 73 Id. 74 Id. 75 Id. 76 Id. 77 China Patent & Trademark Office, https://www.chinatrademarkoffice.com/index.php/search/xbshow/G1208629/18/1.

21 of the lipstick and the lid.78 The patents registered in China are fairly identical to those filed in the United States and European Union.79 Below are Louboutin’s registered patents related to the lipsticks in China.

Figure 1

Figure 2

Figure 3

78 WIPO Global Design Database, supra note 30. 79 Id.

22

Figure 4

Trademarks and Other Protections

While design patents seem to be Louboutin’s most popular form of IP protection in China, there are also several trademarks registered to Christian Louboutin within the “class 3” cosmetics protections.80 Four of these Louboutin trademarks cover the company’s cosmetics products.81 While these do not include trademark protections for the actual lipstick product itself, the

80 Trademark Office of National Intellectual Property Administration, PRC, http://wcjs.sbj.cnipa.gov.cn/. 81 Id.

23 trademarks serve to protect the Louboutin name and overall brand.82 For images of registered Christian Louboutin trademarks in China, see figures below.83

Figure 1

Figure 2

Figure 3

82 Id. 83 Id.

24

Figure 4

25 Figure 5

Unfair Competition

China has an Anti-unfair Competition Law that serves to restrict unfair competition in advertising.84 This Anti-unfair Competition law is used to supplement other laws when specific intellectual property laws do not have the ability to fully protect products.85 This kind of law prevents operators from disrupting the market competition order or harming the legitimate interests of other business operators or consumers.86

Overall Protection in China

Beginning in 2008, China committed to strengthening and ensuring judicial protection of IP rights. 87 Over the years, China has taken several measures to reach this goal, including the organization of three IP courts in 2014 in Beijing, Shanghai, and Guangzhou.88 In addition to the creation of IP courts, China implemented a more severe system of punitive damages in hopes of

84 China’s Anti-Unfair Competition Law: Cracking Down on Malicious Infringement in Advertising, WORLD TRADEMARK REVIEW https://www.worldtrademarkreview.com/brand-management/chinas-anti-unfair-competition- law-cracking-down-malicious-infringement. 85 What Does the Anti-Unfair Competition Law Mean for IP?, MANAGING IP https://www.managingip.com/article/b1l3xdxbmmbgds/what-does-the-anti-unfair-competition-law-mean-for- ip#:~:text=In%20China%2C%20trade%20dress%20is,leading%20others%20to%20misidentify%20their. 86 Id. 87 China’s Commitment to Strengthening IP Judicial Protection and Creating a Bright Future for IP Rights, WIPO MAGAZINE https://www.wipo.int/wipo_magazine/en/2019/03/article_0004.html. 88 Id.

26 decreasing and discouraging counterfeiting and trade secret appropriation.89 All of these steps taken to advance IP protections in China are important to the sale of Louboutin’s lipstick. Because it is patent protected in China, anyone who attempts to counterfeit the product will be subject to suit. Louboutin has taken advantage of these strengthened protections in China in order to protect its name, brand, and products.

III. MANAGEMENT AND ENFORCEMENT OF INTELLECTUAL PROPERTY RIGHTS

The third section of this paper analyzes Louboutin’s marketing strategy and discusses the contract and enforcement issues related to its products and agreements. As discussed below, Louboutin’s marketing strategy is unique in the industry and utilizes not only unsolicited advertisements from popular culture icons, but also its bold designs and the renowned red sole make it an easily identifiable brand world-wide. Due to its popularity, there have been several issues with IP protection enforcement. Other brands and counterfeiters seemingly want to emulate Louboutin in hopes of gaining the same sort of popularity and economic success as Louboutin. Louboutin is no stranger to fighting counterfeit battles, and with the creation of its lipstick and beauty products it has already faced instances of counterfeiting. Because of its solid IP protection base throughout the world, Louboutin has been largely successful in fending off these copycats, and will likely continue to be successful in the future.

(A) Strategies in Marketing: Influencers, Advertising, and Social Media

Today, social media provides as one of the sole forms for marketing and advertising. While many brands use marketing via their own social media platforms or selective advertisements, others collaborate with celebrities, bloggers, influencers, politicians and other high persons of interest. Winning over notable style icons as these significantly impacts a brand, often endorsing a brand’s status as a luxury brand. A key element here is that we now entertain a world where consumers idolize these individuals and are motivated by their clothing choices. These individuals heavily influence the fashion of their supporters or “fans”, which has only increased during the social media uprising in the past ten years, tremendously benefiting luxury brands like Louboutin and providing a sort of free advertising. While there is no doubt many are compensated for advertisements, brands with identifiers in their clothing receive free advertising when influential individuals sport the attire throughout their daily lives, catching the eye of fans or paparazzi, subsequently appearing on social media or in magazines. These “style icons” provide an extreme advantage to the brands they wear and partner with, which with the help of social media, now provides a majority of brand marketing.

Aside from the sort of free advertisement noted above, many celebrities and influencers do have contracts with the brands they represent in social media. But this does not apply when individuals purchase the items themselves versus a brand providing items free of cost intending the individual to advertise the items on their social media platforms. Brands can protect themselves from partnering with an ineffective individual or an individual that may potentially hinder the brand by

89 Id.

27 including a few terms into the agreement as well as the terms covered by the Federal Trade Commission Act.90 It is best for the brand to get an agreement with the individual in writing. A few important terms to include are the individual must provide a disclosure for anything material that is not obvious to the reader, the individual must make sure the content used is original to them outside of content the brand provides, effective dates and compensation for the individual, terms regarding any giveaways or promotions, and other rights that the brand may have over the content the individual publishes. Without a contract consisting of these terms and furthered protection, the brand runs the risk of being personally liable for the individual’s negative and negligent actions while representing the brand.91

As mentioned above, for Louboutin specifically, an example of advertising outside of social media is Jennifer Lopez’s release of her song specifically about Louboutin in 2009. As one of the most familiar musicians/actresses around the world, the song serves as a free marketing tool. This form of organic endorsement is not unfamiliar for Louboutin, mostly due to their refrainment from paid social media efforts.92 As also mentioned above, the most influential example is Carrie Bradshaw (Sarah Jessica Parker) in Sex and the City, with her bold fashion choices and devotion to her Louboutin shoes. The show and movies received enormous attention where Bradshaw served as a style icon to the viewers, especially supporting Louboutin with countless episodes where she sports Louboutin shoes.

For the reasons described above, Louboutin’s introduction of the bullet shaped lipstick to the cosmetic industry will benefit from the company’s competitive advantage and establishment as a luxury brand. After the success of the nail lacquer in the cosmetic industry, it likely that the lipstick will find success in the industry as well. Louboutin’s business strategy and endorsements show that the brand has wisely navigated the market with the introduction of their products, and because of this, recognizes that any further introduction of related products will also prosper.

(B) Louboutin’s History of Enforcement

Counterfeit issues are not new to Louboutin, or the makeup industry as a whole. , Anastasia Beverly Hills, and many other well-known makeup brands have fought off counterfeit cosmetic products.93 Counterfeit makeup not only tarnishes a brand’s reputation but can lead to serious health problems for its users.94

90 Advertising and Marketing on the Internet: Rules of the Road, FEDERAL TRADE COMMISSION (last visited Oct. 1, 2020) https://www.ftc.gov/tips-advice/business-center/guidance/advertising-marketing-internet-rules-road. 91 Influencers are required to disclose paid partnerships with companies and Dior and influencers came under fire in 2016 for what seemed to be an undisclosed social media ad campaign. See Fashion and the (Big) Business of Gifting, THE FASHION LAW (Jan. 13, 2019) https://www.thefashionlaw.com/fashion-and-the-business-of-gifting/. 92 Tyler Cumella, Why Natural Celebrity Endorsement Sells [4 Examples], MEDIUM (Aug. 28, 2017) https://medium.com/@tyler.cumella/why-natural-celebrity-endorsement-sells-4-examples-6029042a3523. 93 Benefit sues counterfeiters over fake cosmetics, TRADEMARKS & BRANDS ONLINE (last accessed Aug. 25, 2020) https://www.trademarksandbrandsonline.com/news/benefit-sues-counterfeiters-over-fake-cosmetics-5434; Anastasia Beverly Hills Sues Over Stolen or Counterfeit Makeup on Offer Up, CITY NEWS SERVICE (Sept. 4, 2019) https://www.nbclosangeles.com/news/local/anastasia-beverly-hills-brow-lawsuit-counterfeit-makeup/1964886/; 94 See Claire Coleman, ‘Using Fake Make-Up Glued My Eyes Together’: The Women Who Discovered the Dangers of Buying Counterfeit Beauty Products Online After Terrifying Scare with Knock-Off Designer Eye Shadows, DAILY MAIL (May 27, 2015, 8:11 PM), https://www.dailymail.co.uk/femail/article-3099936/Using-fake-make-glued-eyes-

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Just like many popular, and particularly high-end brands, Louboutin has dealt with counterfeiting in its shoes, fragrances and makeup and is rather notorious for protecting its brand. Because Louboutin received its luxury status from the red-bottom shoes, the shoes offer a sort of “walking advertisement” signifying status and separating the “haves” from the “have-nots.”95

Louboutin famously brought suit against Yves Saint Laurent, another luxury brand, for trademark infringement. Louboutin is known for its red outsole on its shoes and the red bottom is what identifies a pair of shoes as Louboutin. Louboutin obtained a trademark for the red sole and subsequently, YSL created shoes that were entirely red, including the outer-sole. Louboutin filed suit asserting, among other claims, trademark infringement and counterfeiting. The court explained that generally, a single color is not inherently distinctive but here, the red sole acquired a secondary meaning. The court held that Louboutin cannot obtain a trademark for the entire shoe being red, but where the red sole contrasts with the color of the rest of the shoe, the trademark applies. Thus, a single color can sometimes serve as a trademark in the fashion industry where it has acquired secondary meaning. Louboutin has repeatedly taken on other counterfeiters of its famous red- bottom shoes. The brand also prevailed against Amazon in a European Union Case where the court held that Amazon is liable if it sells and ships counterfeit shoes made by third parties.96

Louboutin also won a lawsuit out of Moscow against four Russian companies that were selling counterfeit Louboutin fragrances.97 The Russian company argued that the perfume products were legally imported and that there was a lack of similarity between Louboutin’s trademarks and the Russian companies’ trademarks.98 The appellate court disagreed and upheld the lower court’s decision to award Louboutin damages and injunctive relief.99 Further, the brand has handled numerous other lawsuits across the European Union.100

In addition to the many instances of counterfeit Louboutin shoes, Louboutin’s luxury lipsticks recently dealt with counterfeit issues. Louboutin filed suit in in the Guangzhou IP Court against Guangzhou Wentan Trading Co., Ltd., alleging the Chinese manufacturer infringed its design patent-protected lipstick packaging by creating and selling lipstick products identical or similar to the designs of Louboutin.101 The court issued its first preliminary injunction since it was created

women-discovered-dangers-buying-counterfeit-beauty-products-online-terrifying-scare-knock-designer-eye- shadows.html; see also Marci Robin, Woman Says a Counterfeit Kylie Cosmetics Lip Kit Caused This Horrifying Allergic Reaction, ALLURE (Feb. 14, 2018) https://www.allure.com/story/counterfeit-kylie-cosmetics-lip-kit-allergic- reaction. 95 Mun-Delsalle, supra note 13. 96 Christian Louboutin Prevails Against Amazon in European Union Counterfeiting Case, THE FASHION LAW (Sept. 4, 2019) https://www.thefashionlaw.com/christian-louboutin-prevails-against-amazon-in-european-union- counterfeiting-case/. 97 Louboutin Handed Victors in Russian Counterfeit Cosmetics Case, THE FASHION LAW (Aug. 17, 2016) https://urldefense.com/v3/__https://www.thefashionlaw.com/louboutin-victorious-in-russian-counterfeit-cosmetics- case/__;!!KwNVnqRv!SHh7uCgXvgUWhbz8c1PaO5IU0g6YNQ8x_u9BvgCSOTaRkzCLNklmgiUyw275YkpFgN jIlas$. 98 Id. 99 Id. 100 Id. 101 Christian Louboutin Wins First Round in Chinese Patent Lawsuit, THE FASHION LAW (July 13, 2016) https://www.thefashionlaw.com/christian-louboutin/.

29 in 2014 and ordered Guangzhou Wentan Trading Co. to immediately stop producing the lipsticks.102 The court held Louboutin’s patent as valid and ruled that not issuing a preliminary injunction would cause greater damage to Louboutin than to the counterfeit Chinese manufacturer.103

IV. CONCLUSION

Christian Louboutin is one of the most famous luxury brands, originally recognized for its red- bottom shoes. Inspired by the red soles, Louboutin has received enormous success with the introduction of related products using the famous “Rouge” color of the soles, specifically in creating a unique and luxurious lipstick. As a famous luxury brand, Louboutin’s business strategy is far different from less recognized fashion brands as it receives success by developing profitable relations with vendors, associating related products to the iconic “Rouge” used for the red-bottom shoes, collaborating with other notable companies, and providing quality in all of their products. Protection of these products using intellectual property rights in the United States, Europe, China, and many other countries also serves as part of Louboutin’s business strategy. Specifically, for Louboutin’s bullet-shaped lipstick, there are many forms of protection in these countries such as trademark and trade dress, copyright and industrial design. In the United States and Europe, these rights often overlap, providing enhanced protection for the lipstick’s design. The most copied articles and designs in the cosmetic industry are those produced by luxury brands. Because of this, Louboutin must enforce its intellectual property rights against potential aggressors and claimants. Being such a large, notable brand, Louboutin has a competitive advantage when protecting its products against potential counterfeit issues.

102 Id. 103 Id.

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