One of the most enduring clichés in the fashion world is that it is the details that make the difference. This particular detail measures 12cm by 10cm, but it has started what is turning out to be the biggest legal battle in the fashion industry. The back pocket of Levi’s jeans, decorated with two intersecting arcs and a simple cloth tag, has been, Levi’s contends, “shamelessly copied” by other denim brands.
Since 2001 the company has filed more than 100 trademark-infringement lawsuits against other jeans companies, focusing on the back-pocket design. So far thousands of unsold jeans have been destroyed and compensatory payouts are expected to reach well into six figures.
But the money is the least of the issues. In fact, it’s hardly an issue at all: one of the cases was settled for $5 000, which could barely have covered the legal costs.
“We are simply enforcing the company’s intellectual property,” says Thomas M Onda, Levi’s global Âintellectual-property lawyer. “Our company’s procedures are in line with any company that has globally recognised trademarks.” Others, however, see it differently. They claim these lawsuits are the dying gasp of a flailing company.
Levi’s was the original denim brand. In 1873 Jacob Davis, a tailor, hooked up with Levi Strauss to create a special pair of trousers for a woodcutter that were strong enough to hold in his bloated stomach. But things have come a long way since then and many industry observers say Levi’s has failed to keep pace.
Since 1996 the company’s sales have been dropping fast. It has lost billions in sales, closed dozens of factories and laid off nearly half of its workforce because, competitors say, it failed to take advantage of the change in the denim market when jeans shifted from being seen as a work garment to a style statement.
Jonny Sorensen, the CE of Von Dutch, one of the denim brands Levi’s is suing, told The New York Times: “[Levi’s] missed the boat. Now they want to make a lot of noise and scare people away.”
Onda denies this: “We were strongly protecting our trademarks throughout the Eighties when our performance was very strong. It’s simply inaccurate to say we just started doing this. It is a mischaracterisation to say that these cases are somehow connected with sales.”
It is an interesting line of argument, one that basically says: we have always been aggressive, so our tactics are no different than usual. To do Levi’s justice, this is probably true. Levi’s is notoriously litigious. The New York Times recently described it as “a leader in lawsuits”, pointing out that in the past five years it has filed more actions than other litigation-happy companies, such as Nike, Walt Disney and General Motors.
The deliberate emphasis by Levi’s on its history of aggressive lawsuits reveals the true source of the company’s ire: not so much that it thinks it is being copied, but the allegation that it missed out on the denim fashion trend and is being pettily litigious in retaliation.
The denim industry has exploded in the past decade. British sales of jeans have increased 40% in the past five years, according to research by consumer analyst Mintel. It forecasts that 86-million pairs will be sold in Britain this year. The market, valued at £1,51-billion, has been boosted lately by the boom in cut-price, own-label ranges. But Levi’s UK sales dropped 12,1% between 2004 and 2006, from £198-million to £174-million.
Calvin Klein introduced the concept of designer denim in 1978 and Helmut Lang upped the ante two decades later by giving his jeans designer prices. But it wasn’t until the late Nineties, with the emergence of Earl jeans from Cali- fornia, that the denim craze truly took hold. This label shifted people’s perceptions of jeans: no longer were they chunky, workmen wear but a sexy item that showed off a woman’s figure.
In Earl’s first year it had a turnover of $600 000. In its second sales rose to $10-million. In 2001 the company was sold for about $86-million.
Denim is serious business. Even the names of the new generation of denim brands indicate how seriously they take themselves: Citizens of Humanity, 7 for All Mankind, True Religion, Earnest Sewn, 18th Amendment.
But the emphasis here is on “new”: jeans are not what they once were — baggy, frumpy, clumpy — and the mid-priced classic brands, such as Levi’s, Lee and Wrangler, have struggled in the new marketplace. They have been squeezed out between, on the one hand, the flashier designer brands and, on the other, the cheap ranges offered on the high street.
Both the top and the bottom ends of the market have focused on denim’s new fashion-based image. Lee and Wrangler, on the other hand, have struggled with stagnating sales. Last year Levi’s ended an eight-year fall in sales, but it is still trying to recoup its losses from its period of what Onda describes as “steep decline” in the late 1990s.
Karl Heinz Salzburger, president of European and Asian operations for the VF Corporation, which owns Lee and Wrangler, said in October last year: “The big, historical denim companies have struggled … We have our own brand image and we are working that heritage and authenticity to give our stores a bit more lifestyle.”
But denim consumers today are more interested in making their bums look good than making reference to denim’s historical, cowboy-centred past. Lee and Levi’s have launched more fashion-conscious ranges and Levi’s recently appointed Armin Broger, who formerly worked at 7 for All Mankind, one of the most successful new denim labels, as chief executive of Levi’s Europe. Some in the industry have questioned whether these brands have left it too late to turn around public perception.
Just because old-school designer names no longer dominate the market is not to say that labels are irrelevant: whenever a new fashion trend sprouts up, fashion snobbery about labels and similar minutiae will follow in its wake.
Back-pocket designs denote jeans brands just as designer logos do on handbags and, in this respect, Levi’s concern about the exclusivity of its design details is understandable. “If a trademark loses its source identifier, it loses its value in the marketplace,” says Onda.
The question is what the value of Levi’s trademark is today. There is no doubt that Levi’s has influenced the legions of denim brands that have sprouted up more recently, if only because it established the original template for how a pair of jeans looks.
“It’s not surprising that these denim brands would look to the first jeans company, but imitation is a double-edged sword,” says Onda.
It certainly has proved to be one for Levi’s: no teachers like to see their pupils overtaking them. Levi’s repeatedly insists that it is now increasing its denim sales, so to compare current figures with those predating 1996 is “misleading”, it says. But the brand’s aggressive tactics against its rivals do not suggest a secure company. Levi’s now employs almost 40 “denim detectives” to prowl through boutiques and department stores looking for potential copyright infringements by competitors.
This sounds quite exhausting to oversee, I say to Onda. “Oh no,” he replies, with a mirthless laugh. “I have endless energy.” — Â