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ITC Judge Spells Out 'Close' Converse Trademark Win

A judge from the U.S. International Trade Commission has issued a full opinion detailing last month’s ruling in Converse’s closely watched case over the Chuck Taylor sneaker, explaining how he arrived at his “close call” that the shoe’s design can be protected by trademark law.

In a 149-page ruling made public on Friday, Administrative Law Judge Charles Bullock spelled out his Nov. 17 ruling – which found Converse not only held a valid trademark on the layout of the famous canvas sneaker, but that Wal-Mart Stores Inc., Skechers USA Inc. and New Balance Athletics Inc. had all infringed it by selling look-alike shoes.

The full opinion makes clear just how narrow Converse’s margin of victory was. Survey evidence showed that only 21 percent of consumers associated the design with Converse, which Bullock said was a major strike against the “secondary meaning” necessary for a valid trademark.

But the design was also registered with the U.S. Patent and Trademark Office, Bullock said, meaning he must show it significant deference.

“Because the factor that weighs against secondary meaning provides the 'strongest and most relevant' evidence, the outcome here is a close call,” the judge wrote. “With respect to [Converse’s] registration, however, it is presumed that the trademark is valid. The undersigned finds that respondents have not met their burden in proving that it is not.”

The decision is a win for Converse in the sweeping trademark case it filed last fall against Wal-Mart and more than 30 other companies. The accused companies had argued that Converse held no exclusive rights to the design at all.

But it was hardly a total win. Judge Bullock found, for instance, that several of Skechers’ key brands at issue in the case did not infringe the Chuck Taylor design, and that company is calling the ruling a victory.

New Balance, which has produced the similar-looking PF Flyer canvas sneaker for decades, received a similar split ruling and has vowed it will overturn the decision on appeal. Wal-Mart, which also received a split infringement ruling, has not publicly commented on the outcome.

Notably, the opinion issued Friday shot down the argument that the Chuck Taylor design elements at issue in the case — a “bumper” at the front, a toe cap, and stripes around the sides — were either too functional or too generic to be protected by trademark law. It also rejected the claim that Converse had lost the right to sue by waiting years to do so, or that the mark was invalid because of widespread third-party use of the design elements.

Judge Bullock’s ruling will now be reviewed by the full ITC; if upheld, Wal-Mart and the other defendants can appeal to the Federal Circuit. If upheld on appeal, the ruling could lead to a broad order barring imports of the look-alike sneakers.

The litigation, launched last year by Converse in response to what it called a spike in “knockoff” Chuck Taylors, once included dozens of companies, but many, including Ralph Lauren, H&M and Fila, have reached private settlements over the past year. Only Skechers, Wal-Mart, New Balance and a firm called Ash Footwear remain in the case.

Converse is represented by V. James Adduci II, Deanna Tanner Okun, Jonathan J. Engler and Evan H. Langdon of Adduci Mastriani & Schaumberg LLP; Christopher J. Renk, Erik S. Maurer, Michael J. Harris, Katherine Laatsch Fink, Audra C. Eidem Heinze and Aaron P. Bowling of Banner & Witcoff Ltd; and Dale Cendali, Claudia Ray, Johanna Schmitt, Allison Buchner, Joseph Loy, Shanti Sadtler, Ian Block, Susan Tanaka, Greg Springstead, Diana Torres, Joshua Simmons and John O’Quinn of Kirkland & Ellis LLP.

Wal-Mart is represented by Mareesa Frederick of Finnegan Henderson Farabow Garrett & Dunner LLP and Laura Chapman of Sheppard Mullin Richter & Hampton LLP.

New Balance is represented by Mark Puzella, Sheryl Koval Garko and Thomas Fusco of Fish & Richardson PC.

Skechers is represented by Barbara A. Murphy of Foster Murphy Altman & Nickel PC and by Lindsay Kelly, Samuel Lu and Melissa Rabbani, Morgan Chu, Jane Shay Wald, Jad Mills and Grace Chen of Irell & Manella LLP.

Ash Footwear is represented by Jeff E. Schwartz and Austen Endersby of Fox Rothschild.

The case is In the Matter of: Certain Footwear Products, investigation number 337-TA-936, in the U.S. International Trade Commission.