IMS Insights Episode 53: Trademarks, Copyrights, & the Future of the Apparel Industry

IMS Elite Expert Gabriele Goldaper shares her insights about intellectual property disputes and emerging trends within the apparel industry and offers advice for those looking to become an expert witness.  (Part 3 of 3)

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Transcript

Hello, and welcome to the IMS Insights Podcast. I’m your host, Adam Bloomberg.

Today, we’re speaking with IMS Elite Expert, Gabriele Goldaper about intellectual property disputes, trends, and advice for future expert witnesses. 

Gabriele Goldaper is a product authentication expert with more than 45 years of experience as a fashion industry executive, consultant, and academic in the luxury and budget markets. She has consulted on branding, marketing, and licensing strategies for numerous companies and teaches apparel management at the Fashion Institute of Design and Merchandising. 

Adam Bloomberg:

So let's talk a little bit about trademark cases. We've got consumer confusion, value deflation caused by maybe a designer and a company using the same name or the same logo. Why don't you give us some examples of those sorts of scenarios?

Gabriele Goldaper:

All right. Well, a trademark is either a name or a slogan, or it's an identifier for your brand. And if you've trademarked that with the trademark office in Washington, DC, you have to make sure that nobody else is using it. Why? Because if anybody else uses it dilutes the strength of your brand. Your identifier is what builds customer loyalty. It's what builds what we call customer equity because it tends to have the customer reorder over and over again. They make associations with your brand. That's why a trademark is very valuable.

The case of Gucci and Guess is a perfect example. Gucci's trademark is the GG, the double G, in various different forms. But Guess can't help it that their name starts with a G. Guess also uses the double G. I don't have to tell you that they fought each other. Now the big question is, is it causing consumer confusion? And if it does, then you have brand dilution. And the argument of Guess was it does not cause consumer confusion because a Gucci handbag can be $5,000, but a Guess handbag can be $49.95, and Guess does use the double G, but in a totally different format than what Gucci is using. So there's all kinds of arguments going back and forth. That one was the trial took a whole week in New York, and I don't believe that Gucci got much anyway.

Adam Bloomberg:

So let's talk a little bit, this makes me think of we've heard counterfeits, we've heard knockoffs. What are the differences between those two, and how is that policed?

Gabriele Goldaper:

Oh, well, counterfeits are illegal and theoretically, and I say theoretically because sometimes they just don't have enough people down at the docks and stuff. But customs checks your goods as they come in to see that they are either counterfeit or that they are the brand that it says. A counterfeit is if you make a garment or a purse, or a pair of shoes, and you call it the name of the brand who makes it. So let's say a handbag, you made a handbag, it's an exact copy of a Prada bag, and you call it a Prada bag, well, that's a counterfeit because it's not a Prada bag.

Now, you can make the Prada bag because there's no protection for a style, okay? A style is a silhouette of, let's say, a handbag or a garment. You can make a Prada bag or a bag looking like Prada, and call it the Gabriele, which is my name and call it the Gabriele bag. And all you've done is created a knockoff, which is an exact copy of somebody's product. That's allowed. Customs monitors and checks for counterfeits. And there's a new job description. There are people who are employed by brands to do nothing but go to the retailers and see if there's any counterfeits hanging. If you recall, eBay, several years ago, unfortunately, because they didn't know any better, was selling counterfeits. And that was a big problem. And so eBay, now, whenever they get merchandised to sell through there, they have to have it validated as a true item.

Adam Bloomberg:

How does a company or a designer prove original intellectual property and ownership?

Gabriele Goldaper:

Intellectual property, you're talking now about copyrights like prints. Well, you apply for a copyright registration. And on that copyright, that document, you have to say who the author is. Now you can say, I own this print, but I bought the print from this art design studio, that's allowed because when you bought it, they gave you an invoice, and you paid the invoice. So ownership was transferred to you. Now, you can register it with the copyright bureau in Washington. The same thing is true, a trademark, you have to do the same thing. You have to submit proof that this is your identifier and that you've used it for the past so many years, and now you want to trademark it.

Adam Bloomberg:

Okay. Well, thank you. All of that's been very insightful. Let's talk a little bit about trends. Do you see any kind of emerging trends in the fashion industry coming now or in the next few years?

Gabriele Goldaper:

Definitely. There are several trends. One of them is that a brand now, unlike in the past, has to have what we call multiple channels of distribution. A channel of distribution is how you sell. It used to be if you sold in the retail world, if you made a garment and then Nordstrom's bought it from you, that was fine. Not anymore. Now you have to have, yes, you want to have; you sell to the retailer to sell your items, right? That's one channel. Now you also have a website, and you can sell direct to consumers, that's a second channel. The third channel is what we call a third party. That's Amazon or eBay or any of the others. And many brands now are in the resale business. In other words, if you send Patagonia an item back that you bought from them, they will recycle it, and they can resell it, and they will give you a certain amount of money for it, which you can use to buy their product or whatever.

All those channels are very valid today. The whole issue of recycling clothes, buying secondhand clothes, that was old-fashioned. Barbara Streisand did it when she was a young girl and made some music to describe that, but it was not big time done; now, especially among the young people, very big. So there's your fourth channel of distribution. That's the trend. The next last trend that I need to address is the dot-current dominance. I say current because I think over a period of years, some of these trends will go away and new trends will come about. But right now, the social media channels, whichever one you want to go to is another channel of distribution, which never was big before.

The influencers that talk on Instagram and wear a certain outfit, you can now push a button and buy it. So that's another, that's all new and very much in. Now there's other trends, which is we used to, we never really shopped online the way we do now. That's directly an outcome of the pandemic, but it will continue. Last, technology, the garment industry was really the last industry that really used and developed technology to expedite and make things happen quicker. It's now so unbelievably data-driven, consumer-driven, everything can be done online now. You create your whole line online on the computer. You don't have to sketch nothing.

Adam Bloomberg:

Well, it seems like a lot of things changed in how we buy things based on the pandemic. So those are great examples. So if we looked five to 10 years in the future related to those trends, what do you think the corresponding legal disputes will be around those things?

Gabriele Goldaper:

I have had already disputes, for example, where a wholesaler sold it to a reseller, and the retailer claimed it was faulty goods. The wholesaler didn't want to take it back, or the wholesaler said, "It's too old, I can't take it back. If it was really faulty, you should have let me know immediately." There's lawsuits over that. Inventory is a big issue. Now, I did a big case there where one of the retailers to make sure that if business was good they had enough inventory at all times, they wrote what we call backup orders to the manufacturer. Now, theoretically, that said to the manufacturer, you better have these goods on hand for when I need them. Now, that same retailer, in this case, went at the last minute and canceled his backup orders, and the manufacturer is stuck with them. Big case, okay, over that issue.

And so there's now all kinds of online capabilities to avoid that. Now, Walmart, Target, many of the big retailers who buy large quantities, they're tied into the manufacturer directly. So every time they make a sale, it reduces their inventory. And the manufacturer sees that, and the manufacturer has been told what their reorder point is. And when that retailer hits their reorder point, unless they have a different agreement, the manufacturer automatically has the right to make them and ship them. So we have a lot of these new technologies that direct access of how you're going about in sales.

Adam Bloomberg:

So, what advice would you give somebody who is new to being an expert or is wanting to become an expert witness?

Gabriele Goldaper:

Well, I would advise them that before you even think about doing expert witnesses, you better be extremely familiar with every phase of the work that is needed and done in the apparel industry. So if you want to go in and be an expert in the apparel industry, don't go there until you've either done all of those phases, which, by the way, I have and/or you are extremely familiar with every part of the apparel industry. Because when you are asked to be an expert, you really have to be an expert. Not just somebody who's familiar, but somebody who's really a pro. So don't even apply until you feel you have that experience. Now you got to remember, although I've been doing it for 26 years, I have more than 45, I have closer to 55 years, in the apparel industry, so I have legitimate experience.

And the United States government has already used me as an apparel expert in the USAID, which is an agency for underdeveloped countries where they can ask for experts. And they've sent me all over the world as an apparel expert. So I have the credentials, plus I have the valid background. I've done all of it. Every phase, I've done production, I've done product development. I've done it all because not only through owning my own company, but somewhere I had a start, and I had good mentors. I learned, and I was determined, and I did it all. So my recommendation is don't go until you have valid experience and valid knowledge.

Adam Bloomberg:

All right. So very last question for you, and it's one on mental health. How do you balance your consulting work, your work as an expert witness, while still having personal time for yourself, your family, and your friends?

Gabriele Goldaper:

That's an excellent question because it's a big issue. I'm very good with my attorneys in telling them about my own deadlines. And so when they ask me to do something, I have one case where they gave me three days, I just don't take it because my mental health would be suffering. I would be too stressed out. I push very hard to get all my documents from the attorneys early enough so that I can do it on my schedule. And every attorney I work with, when they need dates for deposition, I pick the date. I tell them I can do it this day, this day, and this day. And they have to pick one of those days, you see. So I'm very careful about scheduling. I've learned that now over the years because I did have three children and raised them. And I'm careful always to schedule everything so that I can manage. It's important; everybody has to do that.

Adam Bloomberg:

Well, it sounds like you're juggling a lot, and you're juggling it successfully. Thank you, Gabriele, for your time. We really appreciate it.

Gabriele Goldaper:

You're most welcome. I enjoyed it.

Thank you to Gabriele Goldaper for speaking with us today, and a special thanks to our listeners. 

At IMS, we’re trusted to deliver consulting services to the most influential global law firms early with Pre-suit and investigation services, then in litigation during discovery, arbitration, and trial. It’s been our privilege to serve our clients on more than 20,000 cases and over 2,000 trials. Be sure to subscribe to our podcast and join us next time on the IMS Insights Podcast.