UK online fashion superstore ASOS has been forced to pay £20.2 million over alleged trademark infringements to two rival European retailers – cyclewear manufacturer ASSOS of Switzerland and German menswear retailer Anson’s Herrenhaus.
The global settlement between ASOS and ASSOS was reached following a heated battle of the brands covered by Boodle Hatfield solicitor, Becky Shaw, last year. Beginning as a Community Trade Mark Dispute in the European Union Intellectual Property Office (EUIPO) (formerly the Office for Harmonisation in the Internal Market (Trade Marks and Designs)) the owners of ASSOS launched English court proceedings in December 2011 alleging infringement of its CTM and the partial invalidity of the ASOS UK trade mark.
While the UK High Court held in favour of ASOS, its decision was reversed by the Court of Appeal in April 2015. A majority of the Court of Appeal held that the ‘ASOS’ trade mark was likely to cause confusion and damage the distinctive character of the ‘ASSOS’ mark. However, it found that ASOS was entitled to rely on the ‘own name’ defence and refused ASSOS permission to appeal this decision to the Supreme Court.
Despite amounting to almost six months profit for ASOS, chief executive Nick Beighton welcomed the multimillion pound deal. “We are pleased to have put this litigation behind us. Entering into this settlement at this juncture is the right commercial decision for our business”, Beighton said. According to the terms of the settlement, ASOS will be allowed to begin selling athletic leisurewear but it is prohibited from selling cyclewear and from opening shops in Germany.
ASOS’ decision to negotiate settlements was also well received by City of London analysts concerned by the impact of the litigation on the UK retailer’s European markets. “Whilst Asos has successfully defended itself until now, there was no certainty they would be successful in these markets. Losing a case… would force Asos to rebrand, which was a significant risk that Asos has eliminated”, Exane analyst, Simon Bowler, stated. The opportunity to expand into the global sportswear or ‘athleisure’ market is also considered a victory for ASOS.
The ASOS-ASSOS trade mark dispute marked a first for the UK online fashion empire. Previous intellectual property litigation brought against the company has centred around claims that ASOS stole individual clothing designs. Outstanding legal proceedings against ASOS in the US, France and Germany are not thought to represent any material financial risk.