A federal judge said Monday that a jury would have to decide whether surf-wear giant Quiksilver Inc. or a small Los Angeles clothing maker first used the "Roxy" trademark, which Quiksilver has built into a $200-million-plus brand for girls.
In his ruling, U.S. District Judge Dickran Tevrizian denied requests by Quiksilver and Kymsta Corp., which each sought to establish that it was the first to use the name on teen clothes. Tevrizian added, however, that it was "highly likely" that Huntington Beach-based Quiksilver would prevail, based on sales and promotional materials that the company says date back to 1990.
Still, by denying Quiksilver's request to declare it the first user of the trademark, Tevrizian gave some hope to Kymsta's husband-and-wife owners that they might be able to continue using the name Roxywear on their 11-year-old line of girls' clothes. The privately held Los Angeles-based Kymsta last year had sales of $8 million, the company's attorney said, about $2 million of which came from sales of Roxywear.
The dispute began a year ago when Quiksilver sued Kymsta and owners Arthur Pereira and Roxanne Heptner for trademark infringement, claiming that they improperly traded on the success of Quiksilver's Roxy line with their similar-sounding Roxywear.
The two brands are sold in some of the same stores, including Nordstrom, resulting in some misplaced or misdirected orders, Quiksilver said, such as when a retailer that is sent Roxywear returns it to Quiksilver.
Large companies, which often invest millions into brand marketing and promotion, routinely try to protect those investments by demanding that other companies not use the same or similar names. The law requires that to protect their trademarks, a company must seek to prevent others from improperly diluting their value.
What was different about this case was that Kymsta fought back, defending itself against Quiksilver's claim and maintaining that it was the rightful owner of the name.
"It could be at the end of the day a jury finds that neither side gets to enforce its mark against the other and business should continue on as usual with both sides getting to use their mark," Kymsta lawyer James D. Nguyen said after the hearing. Kymsta said he "would think of that as vindication that a big company didn't trounce on their trademark."
Quiksilver, the world's largest surf-wear maker with a market capitalization of about $1 billion, sells a wide range of labels besides Roxy, including Hawk for boys.
Both sides said they are open to a settlement. A trial is set for November.