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COACH LEATHERWARE CO., INC. v. ANNTAYLOR

November 8, 1990

COACH LEATHERWARE COMPANY, INC., PLAINTIFF,
v.
ANNTAYLOR, INC., LAURA LEATHER GOODS LTD., A & R HANDBAG, INC. AND RON'S ELEGANCE CENTER, INC., DEFENDANTS.



The opinion of the court was delivered by: Kevin Thomas Duffy, District Judge:

MEMORANDUM & ORDER

Plaintiff Coach Leatherware Company, Inc. ("Coach") commenced this action for trademark infringement and statutory and common law unfair competition against defendants AnnTaylor, Inc. ("AnnTaylor"), Laura Leather Goods, Inc. ("Laura"), A & R Handbag, Inc. ("A & R"), and Ron's Elegance Center, Inc. ("Ron's"), alleging that defendants produced certain knockoffs of known Coach leather handbags which are likely to cause and have caused confusion in the marketplace. 15 U.S.C. § 1051, 1125(a) (1982). Coach, pursuant to Fed.R.Civ.P. 65, seeks to enjoin the manufacture and sale by AnnTaylor, Laura, and A & R of the infringing handbag styles. Ron's has consented to being enjoined. AnnTaylor, Laura, and A & R move, pursuant to Fed.R.Civ.P. 56, for summary judgment dismissing the complaint. Both sides have agreed that a hearing for introduction of the evidence is unnecessary.

FACTS

Coach is a New York corporation engaged in the design, manufacture, marketing, distribution, and sale of leather fashion products, including handbags, briefcases, and belts. Complaint ¶ 8. Marketed in upscale general and department stores throughout the United States, Coach creates an exclusive and expensive line of wares. Complaint ¶¶ 9-14; Frankfort Declaration ("Decl.") ¶ 8. In addition, Coach has a mail order business and catalogue. All of its products are sold exclusively under its own label. Frankfort Decl. ¶¶ 8-9. Its products are designed by an in-house staff and manufactured domestically. AnnTaylor, a prominent clothing company that also designs and manufactures handbags, shoes, belts, and other wardrobe accessories, is a wholly-owned subsidiary of AnnTaylor Holding, Inc., which is in turn owned by Merrill Lynch Co., Inc. Rule 9 Statement; AnnTaylor 3(g) ¶ 2. Laura and A & R are New York corporations engaged in the business of designing and manufacturing handbags as well. A & R is a Laura affiliate. Rule 9 Statement.

Like all Coach bags, the three styles at issue in this matter incorporate a distinctive lozenge shaped leather tag suspended by a beaded brass chain. The tag, appearing on all Coach bags ("the Coach tag"), is suspended from a beaded brass chain with the name "Coach Leatherware" embossed on the tag itself. Frankfort Decl. ¶ 7. Although Coach's bags are not trademarked, the Coach tag is the subject of U.S. Trademark Registration number 1,242,098. Frankfurt Decl. ¶ 7, Exh. 3. Coach tags, alone, are recognized by the public, and are often stolen from the bags. In fact, one of Coach's catalogues includes the phrase: "It's not a Coach Bag without a Coach tag." Plaintiff's Reply to AnnTaylor's 3(g) Statement, ¶ 14. Moreover, Coach store managers warn security persons to prevent thefts of the tags themselves. AnnTaylor's bags, similar of type and style to the Coach bags, also contain a leather tag embossed with the AnnTaylor name. Because these and the other allegedly infringing handbags were selling at a substantial discount, Coach alleges that its market share was affected. Also, Coach avers that recognition of its bags in the marketplace was undermined.

DISCUSSION

A. PRELIMINARY INJUNCTION

Coach moves to preliminarily enjoin AnnTaylor, A & R, and Laura from emulating and recreating standard well-known Coach designs. Coach avers that because AnnTaylor, a retail chain of approximately 160 women's fashion stores located throughout the United States, is essentially replicating three of Coach's handbag designs, the Dinky Bag, Duffle Sac, and Convertible Clutch, including the distinctive leather tags and brass detailing attached to the bags, that injunctive relief is appropriate. Flaherty Depo., at 9. The standard for granting injunctive relief in the Second Circuit mandates a showing of irreparable harm and either: (1) a likelihood of success on the merits; or (2) "sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting the preliminary relief." Jackson Dairy Inc. v. H.P. Hood & Sons, Inc., 596 F.2d 70, 72 (2d Cir. 1979). Coach claims entitlement to an injunction even though its bags are not individually trademarked except for the detachable tag.

The most vital prerequisite for the issuance of a preliminary injunction is a showing that without such equitable relief, the movant is likely to suffer irreparable harm before a decision on the merits can be rendered. Citibank, N.A. v. Citytrust, 756 F.2d 273, 275 (2d Cir. 1985) (citing 11 C. Wright & A. Miller, Federal Practice and Procedure § 2948 at 431 (1973)). "To establish irreparable harm, plaintiffs must demonstrate 'an injury that is neither remote nor speculative, but actual and imminent.'" J. Richard Ryan v. VHA Enterprises, Inc., Aetna Life Insurance Co. and Voluntary Hospitals of America, Inc., [1990 Transfer Binder] Fed.Sec.L.Rep. (CCH) ¶ 95,244, 1990 WL 58969 (S.D.N.Y. May 1, 1990). Coach falls short of meeting its burden to show imminent injury.

Although the injury Coach may suffer is real, inter alia, loss of good will in its business, the fact that a preliminary injunction was on motion instead of by Order to Show Cause is telling. Indeed, Coach had avenues in which to expedite the procedure to obtain a preliminary injunction. Generally, choosing the slow road to relief, rather than pursuing other avenues for expedited relief, indicates that the harm may not have been irreparable.

B. SUMMARY JUDGMENT

In moving for summary judgment, AnnTaylor avers that a competitor may emulate a rival's unpatented or untrademarked product design so long as the competitor clearly labels his own product, does not use confusingly similar trade names or logos, and does not parody the overall presentation and packaging of the product, i.e., the trade dress employed by the rival company.

Nonetheless, in support of its motion for an injunction, Coach avers that it is likely to succeed on the merits because its bags, incorporating distinctive styling and detail, are recognizable to the consuming public, essentially having acquired a secondary meaning in the ...


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