In a recent case, Puma sought a preliminary injunction against Forever 21, after the popular fashion retailer began producing an alleged knock-off of Puma’s Fenty Creeper sneaker, as well as the Fur Slide and the Bow Slide sandals. The court refused to grant a preliminary injunction. In applying the four-prong test from Winter v. Natural Res. Def. Council, the court determined that Puma failed to carry its burden in demonstrating a preliminary injunction was warranted. More specifically, Puma did not make a “clear showing” that there would be a likelihood of irreparable injury if injunctive relief was not granted, mostly due to Puma failing to submit probative, nonspeculative evidence that it had lost or was likely to lose customers, goodwill, or a diminishment of brand value due to Forever 21’s infringing conduct.
Changes in what is presumed and necessary to show irreparable harm
In trademark infringement cases, if customers are confused between a senior user’s product and a similar looking knock-off, they may mistakenly attribute product defects or negative impressions of the knock-off’s source to the senior user. When the quality of the senior user’s goods or services are called into question, its reputation may be at risk. As a result, the senior user may suffer a loss of goodwill or diminishment of brand value, beyond any directly lost sales. This kind of harm is not only difficult to quantify - it is nearly impossible to determine how much money would be required to offset such damage. The harm would be irreparable.
Until recently, all courts followed the traditional rule that irreparable harm is presumed if the trademark owner shows enough likelihood of confusion among consumers after seeing the defendant’s goods or services. However, a recent ruling in eBay v. MercExchange has created a new precedence in patent infringement cases that has spilled over to trademark matters. Irreparable harm may no longer be presumed and must be supported through separate evidence that is real and significant, not speculative or remote.
Using consumer surveys as evidence to support establishing irreparable harm
In order to obtain a preliminary injunction, there is often a limited amount of time to provide evidence of irreparable harm. One way to quickly show that exposure to the allegedly infringing product harms brand value is with survey research, namely a variant of the well-known Squirt survey format, which has typically been used for establishing likelihood of confusion.
In the case of Puma v. Forever 21, AMS (as a research-on-research project) designed a variant of the Squirt survey in which respondents viewed both Puma’s Fenty Bow Slide sandal and Forever 21’s alleged knock-off, with a separate group of respondents viewing a non-infringing Forever 21 shoe as a control. For each pair of shoes, respondents were asked to rate brand image using previously validated attribute scales. Results revealed that respondents who saw Forever 21’s allegedly infringing shoes rated Puma’s shoes as being lower in brand prestige compared to those who saw the control shoes. In this case, Puma should have gotten their preliminary injunction as evidence shows that damage was done to their brand value because of the similar-looking knock-off, thus supporting a finding of irreparable harm.
We have repeated this experiment for two other well-known cases with interesting results and are ready to share those results with trademark professionals. For more information on conducting consumer surveys to assess whether diminishment of brand value has occurred, register for our upcoming webinar presented by survey expert Bob Klein, senior manager Marcello Santana, Esq., and senior analyst Laura Paige, Ph.D.