Green is the New Black: The Legal Implications of Upcycling in a Fashion Forward Era

Upcycling has recently been deemed the biggest fashion trend of Spring / Summer 2021. The idea of providing a “second life” to pre-worn clothing has come to the fore of the contemporary fashion industry and demonstrates a welcome shift towards the desire for sustainability and eco-friendly fashion. After all, if you want to change the world, why not do it in style?

All across the catwalk, luxury brands from the likes of Miu Miu and Coach have embraced the process of re-working deadstock, worn out or damaged materials into new fashion pieces that are fair-trade and fabulous. From eco-chic to high street boutique, high end brands are not the only market level to immerse in the “go green or go home” movement. It is evident that more and more small-scale boutiques are offering upcycled products including jewellery, clothing and accessories incorporating pieces from prominent luxury brands at lower price tags.

The allure of upcycling luxury fashion at non-luxury prices raises important questions about the uncontrolled use of trade marks on upcycled products and highlights key issues for brand owners and upcyclers to be aware of in the course of limiting these legal risks.

The Legal Landscape

Trade marks constitute powerful brand protection tools and should be a forefront consideration for brand owners and upcyclers alike. The Trade Marks Act 1994 permits any sign which can be graphically represented and is capable of distinguishing goods of one undertaking from those of another as being trade mark registerable. Registration of trade marks confers on its owner the statutory right to the exclusive use of that mark in connection with the goods or services for which it is registered (Section 9 Trade Marks Act). In other words, it allows brand owners to hold what appears to be the upper legal hand in relation to trade mark infringement.

To establish trade mark infringement, a brand must demonstrate that it is the registered proprietor of the mark and that the infringing party’s use of such mark in the creation of the upcycled product creates a likelihood of consumer confusion about the origin of the product. However, the law does provide a mechanism of defence for such infringement claims, commonly referred to as the “Doctrine of Exhaustion”. Put simply, this provides that once a trade mark owner has made the initial sale of its product in the market, it cannot regulate or control how and where its product is marketed or sold from there onwards.

Notably, an exemption to this defence applies where “there exists legitimate reasons for the proprietor to oppose further dealings in the goods (in particular, where the condition of the goods has been changed or impaired after they have been put on the market).” As upcycled products are, by nature, materially different from the original products, this has prompted significant litigation in a number of areas, including several high-profile claims across the fashion industry against upcyclers. For instance, Chanel recently sued Shiver + Duke over its repurposing of authentic Chanel buttons into costume jewellery, whilst Rolex also issued proceedings against La Californienne over its customised pre-owned Rolex brand watches. As the above case-law demonstrates, upcycling luxury goods will likely almost always present some form of legal challenges particularly in the United Kingdom and Europe.

However, across the water one recent landmark decision is paving the way for what could be a potential barrier to brand owners’ enforcement rights against upcyclers. In Hamilton International Ltd. v. Vortic LLC, the U.S. District Court for the Southern District of New York provided that the defendant’s conversion of the plaintiff’s antique HAMILTON pocket watches into wristwatches did not infringe the plaintiff’s rights. The Court’s reasoning centred on the fact that the defendant’s website and adverts contained full disclosure that the defendant’s products were created with HAMILTON pocket watch parts. Above all, the decision demonstrates that the line between infringement and permissible upcycling is far from clear and that each case will turn on its own merits.

Practical Considerations

As the trend of upcycling continues to grow, aspiring designers will need to be aware of the legal risks associated with this new venture from an intellectual property perspective and ensure that appropriate steps are taken to mitigate such risks. Some examples include the following:

De-branding the reworked fashion piece to ensure the upcycled product does not involve any “use” of a brand’s registered trade mark in any shape or form;

Tailoring marketing and / or advertising campaigns of the upcycled product to include full disclosure and ensure that there is no suggestion of affiliation or sponsorship between the upcycled product and the brand owner; or

Seeking a form of licensing agreement with the brand owner to afford a balance between obtaining permission, whilst also allowing them to retain control over the quality of the upcycled product and how the brand / trade mark is being used.

If you would like any further information or advice on these issues, please contact Shannon Gawley from the Commercial team.

*This information is for guidance purposes only and does not constitute, nor should be regarded, as a substitute for taking legal advice that is tailored to your circumstances.