IP Law Daily, TRADEMARK—E.D. Pa.: Jury to decide true owner of GRISHKO trademark for ballet shoes, (Jul 14, 2022)

By Brian Craig, J.D.

Reasonable jurors could find that either the international owner of the GRISHKO mark or its former U.S. distributor is the true owner of the trademark.

The federal district court in Philadelphia, Pennsylvania has concluded that a jury must decide whether the international owner of the GRISHKO mark for ballet shoes, or its former U.S. distributor, which owns the registered trademark in the United States, is the true owner of the trademark. In denying summary judgment motions, the court concluded that reasonable jurors could find no intent to transfer ownership to the former U.S. distributor. The court also ruled that a jury trial is needed to decide whether the shoe design is protectable trade dress and most other issues (I.M. Wilson, Inc. v. Grichko, July 12, 2022, Pratter, G.).

The defendants and counter-plaintiffs in this case are Russian and Czech entities that manufacture and sell ballet shoes under the name GRISHKO (collectively “Grishko”). Grishko owns the trademark GRISHKO everywhere in the world, except for the United States. I.M. Wilson, Inc., owns the GRISHKO federally registered trademarks in the United States for ballet shoes and has since the early 1990s. For decades, I.M. Wilson was Grishko’s exclusive distributor in the United States. In 2016, Grishko terminated the exclusive licensing agreement under which the parties were operating, and the exclusivity of the relationship officially came to an end in March 2018. The former U.S. distributor, I.M. Wilson, sued Grishko for trademark infringement and related claims. Grishko filed counterclaims for trademark infringement and related claims. In July 2019, the court granted a preliminary injunction to prevent the international owner of the GRISHKO mark from infringing on the federally registered U.S. GRISHKO mark. In November 2020, the court largely denied the former U.S. distributor’s motion to dismiss the counterclaims. The parties then moved for summary judgment on various issues.

Trademark ownership. The court first concluded that reasonable jurors could find either party is the true owner of the trademark. To prevail on a trademark infringement claim, the claimant must prove: (1) ownership, (2) that the mark is valid, and (3) that the other party’s use of the mark is likely to confuse customers.

While the parties agreed on the validity of the mark and existence of likelihood of confusion, each side vehemently argued that it was the true owner of the GRISHKO mark. Neither party could conclusively prove an oral agreement to transfer ownership. Reasonable jurors could find that the parties did not have an explicit agreement to transfer ownership or an intent to permanently transfer ownership. Reasonable jurors could also find that the former U.S. distributor did not offer consideration for the assignment. In the absence of a contract, reasonable jurors could find that either party is the true owner of the trademark. Therefore, the court denied summary judgment on the trademark infringement claim.

Laches defense. Next, the court denied summary judgment on the laches defense asserted by the former U.S. distributor that the international owner waited too long to bring its infringement claims. While the Lanham Act does not have a statute of limitations, trademark owners cannot observe potential infringement and then wait to sue. Under the equitable doctrine of laches, the trademark owner is barred from bringing a claim for infringement if the owner: (1) engaged in inexcusable delay in bringing suit; and (2) that delay prejudiced the accused infringer. Here, the court found that the international owner did not wait too long to bring its infringement claims. Until the court is able hear for itself testimony as to permanent ownership of the mark, the court could not find that the international owner should have known to sue earlier.

Trade dress. The court also denied summary judgment on the international owner’s trade dress infringement claim. Trade dress is “the overall look of a product,” including a product’s packaging, design, and its size, shape, and color. Reasonable jurors could find that the pointed shoe design was protectable as trade dress, and that the former U.S. distributor copied that trade dress in having another manufacturer produce near-identical shoes.

False advertising. The court concluded, however, that no reasonable juror could find that the former U.S. distributor engaged in false advertising. For false advertisement, the international owner must prove that the distributor made material misrepresentations about the shoes that misled customers causing harm to the owner. The international owner failed to show that it was harmed by the distributor calling itself the exclusive North American distributor. The distributor’s filling of orders with its own shoes did not count as false advertising.

New NIKOLAY mark. Furthermore, the court concluded that the international owner’s new NIKOLAY mark did not infringe on the former distributor’s GRISHKO mark. Prior to this lawsuit, all GRISHKO shoes were handmade in Russia. Now, the NIKOLAY shoes are made in Russia through the same process, while J.M. Wilson’s GRISHKO shoes are made in China. After the filing of the suit, the international owner began selling its shoes under the new NIKOLAY mark. The comparison between the new NIKOLAY product and the old GRISHKO product amounted to proper comparative advertising. In other words, NIKOLAY shoes were the same as the old GRISHKO shoes, but under a “new” mark. Grishko had a competitive right to reference the GRISHKO mark in order to explain that to the public. Thus, the court granted summary judgment on the international owner’s use of the new NIKOLAY mark.

Breach of contract. Finally, the court denied summary judgment on the international owner’s breach of contract claim. Reasonable jurors could find that the former distributor breached its contract with Grishko.

Because there were many disputed issues of material factual, the court largely denied the motions for summary judgment.

The Case is No. 2:18-cv-05194-GEKP.

Attorneys: Brian A. Coleman (Drinker Biddle& Reath LLP) for I.M. Wilson, Inc. Gregory A. Lomax (Lauletta Birnbaum LLC) for Grishko Dance, S.R.O.

Companies: I.M. Wilson, Inc.; Grishko Dance, S.R.O.

Cases: Trademark PennsylvaniaNews