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Lululemon Victory Upheld By Appeals Court in Trademark Dispute

Post Time:2022-08-16 Source:sourcingjournal.com Author: Views:

Lululemon once again emerged victorious in its years-long trademark battle with the California activewear brand Aliign last week.

Aliign Activation Wear originally sued the Vancouver yoga wear company in April 2020 for using the word "Align" in connection to activewear. It accused Lululemon of trademark infringement, false designation of origin and unfair competition and sought an order compelling it to cease using words similar to its own "Aliign" mark and to pay damages of more than $20 million.

A California federal court ruled against Aliign last summer. The California business filed to appeal the decision in July 2021. The 9th U.S. Circuit Court of Appeals ultimately agreed with the district court. In an Aug. 9 decision, it said Aliign had failed to demonstrate that "reasonably prudent consumers" were likely to believe its goods were manufactured or sponsored by Lululemon.

Aliign filed to trademark its name in connection with athletic apparel, athletic bags and yoga mats in 2014. The United States Patent and Trademark Office finally approved the mark in March 2017.

A little more than a year earlier, in February 2016, Lululemon began its own journey to trademark the word "Align" in connection with clothing—namely, crop pants, pants, shorts, tights and leggings—and yoga accessories. It had used the term to sell yoga mats since 2008, three years before Aliign began using its name in commerce, and later launched an Align yoga apparel line.

In June 2017, the USPTO refused Lululemon's trademark registration because of a "likelihood of confusion" with the "Aliign" mark. Though Lululemon's proposed mark used one less "I," "the marks remain phonetic equivalents and thus sound similar," the USPTO said.

Six months later, Lululemon tried once more, this time filing applications for the terms "Align Pant" and "Align Crop." The USPTO denied both applications, again on the grounds that they were too similar to Aliign's trademark. Lululemon applied to trademark "Align" again in October 2018. The USPTO rejected the registration months later. The application is still live, but suspended.

Despite failing to receive any trademark protection, Lululemon has continued to sell its Align activewear. In Aliign's April 2020 complaint and its subsequent amended complaints, the company argued that Lululemon's use of the term "Align" had caused or is likely to cause consumer confusion. As such, it contended that it had been damaged and deprived of "substantial sales, profits and royalties."

In its decision upholding the district court's ruling, the appeals court held that Aliign had "failed to raise a triable issue of fact as to whether reasonably prudent consumers encountering AAW's goods will likely believe that those goods are manufactured or sponsored by lululemon."

The "most significant factor," the memo said, was the way the companies' respective products are marketed to and encountered by consumers. Lululemon sells its goods on its website, at its stores and in select yoga studios. Aliign, on the other hand, sells primarily through its own website. "The near absence of any overlap in marketing or distribution channels weighs heavily against a finding that reverse confusion is likely here," the appeals court said.

The decision also noted how Lululemon's Align pants are typically accompanied by Lululemon's logo or name, "further diminishing any likelihood of confusion." Lululemon, it added, appeared to be unaware of Aliign's mark when the alleged infringement began. Furthermore, it argued, the single email Aliign provided as evidence of confusion "actually proves the opposite."

"The evidence here also indicates that both companies' yoga products are far more expensive than other yoga products and thus one would expect that consumers would exercise a high level of care before purchasing anything from Aliign or lululemon," the court added. "That level of care reduces any likelihood of confusion."