Louis Vuitton: don’t be a chicken!
The case of South Korean restaurant vs. Louis Vuitton has been one of the most amusing legal debacles involving a major brand recently. This genuinely fun story that also seems to have more to it offers a great opportunity to explore the subjects of luxury brands, trademark infringement, counterfeiting, and last but not least, the dark depths of the human psyche.
Firstly, I wondered if anybody was surprised that the incident took place in South Korea. The story falls so neatly into stereotypes, it almost feels like it was made up by one of the nation’s competitors. It can’t be denied that we’re talking about no ordinary country. It has fans in seemingly all continents who revere it for its excellence in education and technology, style and pop culture, and general high-performance ethos. On the other hand, it famously has the second highest suicide rate, a shocking rank for a rich, industrialized nation. Less flattering depictions furthermore keep emphasizing the prevalence of plastic surgery, conformism, and authoritarianism in social interactions.
Everybody seems to agree however, that image in South Korea is no joke, and this is where we arrive at the source of the country’s abiding love for fashion and luxury. For decades, Western luxury brands have done extremely well in South Korea. The last third of the 20th century has been a period of miraculous economic growth, so in a sense, this is just another example of people gorging themselves in everything they couldn’t previously afford before acquiring money. If we wanted to illustrate the country’s prowess we could begin and end by pointing out that Samsung is Korean. Even more impressively, South Korea files more patents per GDP than anyone else, and it is regarded as the most innovative country in the world.
But let’s get back to the case. Essentially what happened is that a restaurant in Seoul pissed off Louis Vuitton by taking its name AND monogram pattern to sell chicken. It is known that Louis Vuiton Dak adopted the name at least in part due to the fun factor, as the last two words together read “tongdak”, the Korean word for “whole chicken”.
Looking at the snaps above, our first thought might be something like: “Why does chicken need monogrammed packaging?” It’s an imitation so total it’s astonishing, hilarious in its audacity. If we have some faith in humanity left, we conclude it’s a joke. Undoubtedly owner Mr. Kim is lightly poking fun at the snobby tendencies of his customers, telling them “I’ll give you what you want!” From a legal perspective it borders on trademark parody.
However, as humorous as this move was, it proved to be devastating. The wrath of Louis Vuitton soon reached the Korean business, and Louis Vuiton Dak was contacted by a court in Seoul. Threatened with large fines, Kim changed the name to “chaLouisvui tondak”. This was a big mistake, and he finally ended up paying a fine of 14.5 million KRW (about $125000).
The court ruling stated that even though the restaurant owner did slightly change the original name, it was still too similar. The fact that Louis Vuitton is a highly reputable brand with a big counterfeiting problem only made the situation worse for Mr. Kim. Even though the two businesses operated within different segments of the economy, as one was already a reputable trademark, the other was not allowed to use its name regardless. Generally speaking, the more reputable a trademark is, the more likely that a court will find there is a danger of infringement.
This case is so odd, we’ve got to wonder what kind of process takes place in the consumer’s mind upon encountering Louis Vuiton Dak. The first and most obvious point is, that fast food and luxury fashion are worlds apart concerning prestige. Fried chicken is affordable, accessible, common – luxury fashion is sold as exclusive, aspirational, glamorous. The association of the two things clearly harms the prestige of the brand. Had the restaurant been allowed to continue under the name Louis Vuitton Dak, the reputation and distinctive character of the trademark would have been damaged.
At the same time, the monogram has a curious effect on the perception of the chicken – not thinking too much about it and just going with our gut, we don’t suspect the contents of that paper bag to be that bad. That is the power of association, and this is exactly why the evaluation of whether two trademarks are similar is based on the subjective perception of the “ordinary consumer” rather than on rigid rules. In principle, any one individual’s opinion on whether two things are similar doesn’t matter, the most common reaction does. Because of this latter effect on our perception, we have to wonder if there was a genuine attempt on the restaurant’s part to take unfair advantage of Louis Vuitton’s reputation for quality.
While we might not have wanted to see the Korean business destroyed, it’s not like Louis Vuitton was not deserving of a break either. Even among other European luxury brands, Louis Vuitton seems to possess a uniquely bittersweet fate. Across the world, it seems to have a hold on the imaginations of rich and poor alike. Stated simply, it is incredibly coveted. However, in today’s global marketplace protecting your brand is a fierce battle. The company reportedly reserves about €15 million on fighting counterfeiting every year.
A few years ago at the height of the global Louis Vuitton bag craze the company was not a clear winner. Thanks to the seemingly unprecedented counterfeiting efforts the company not only lost in profits, but the very key to their sweeping success, their brown monogram bags suffered severe losses in prestige, as millions of fakes flooded the streets.
For a bunch of copycats, the ingeniousness of coming up with multiple variations on the original pattern was impressive. The patterns used for counterfeiting seemed to have been strategically designed in such a way that although one or two components were subtly changed, as the overall impression remained similar, the changes were surprisingly inconspicuous.
In light of all this, Louis Vuitton’s exasperation and eagerness to crack down on infringement in understandable. Businesses fighting the counterfeiting of their products are in the right, and the Chinese government in particular should make no mistake that their lack of interest in upholding international law just because counterfeiting benefits their economy will always be an issue in their dealings with other countries.
Still, the way matters were handled here is frustrating. Kim was given a second chance, yet it ended up counting for nothing. Why did the quarrel have to come to such a severe end? Being threatened by a huge fine, Kim must have given a lot of thought to the new name before introducing it. If he was about to shoot himself in the foot again, why couldn’t anyone tell him?
Ignorance of the law is no excuse for breaking it, goes the saying. While we could certainly argue that it has to be this way, such a severe principle will inevitably have its victims. For one, it’s not forgiving towards humor, as we can see here. It also puts stress on the individual by requiring them to be vigilant, especially because many legal provisions have little common ground with the natural assumptions of the ordinary person. And while reportedly brands fine copycats in order to show the world that they will not put up with it rather than for financial reasons, for an ordinary person a $125000 fine is in no way “symbolic”.
Is a fine this size really meant to eliminate the likely possibility of another chicken joint stealing the name of Louis Vuitton, or is it simply an intimidation tool? Whatever we might think in this specific instance, one key thing to affirm to make sure life remains livable for common people is that the interests of companies are not equivalent with the interests of society as a whole, no matter how hard they might try to make us believe so.
But let’s examine Louis Vuitton’s standpoint. Recently in another trademark infringement case Louis Vuitton claimed that the LV monogram printed basketball that Hyundai featured in one of its commercials diluted the distinctiveness of the brand.
Although that might sound vague, they are right: the truth is, counterfeiting is not the only way to do harm to a luxury brand, overexposing it is enough, and if logo prints are anything like fashion trends, they respond predictably to it. Fashion trends thrive when the garments featuring it are well-made and hard to get. They get less exciting when a bunch of lower quality copies are offered by high street stores and they become an increasingly common sight in everyday life. Finally, they meet their death when through oversaturation they become ordinary, when they lose their distinctiveness as a style. When something loses its distinctiveness, it loses its meaning, i.e. all the emotional associations that go along with it.
The harm that is done to Louis Vuitton thus has to do with the perceptions and feelings of the consumer. At the moment, the LV logo canvas is associated with premium quality, unique products. If, however, we saw the logo everywhere from fried chicken to basketballs, not only would the pattern lose desirability through these new associations, but it would eventually feel like something ordinary. Louis Vuitton’s and other luxury brands operations to sell what are essentially pieces of fabric for the price of small houses only works if consumers feel like there is some meaning inherent in Louis Vuitton items that other products don’t have. Overexposure is death. I believe this is, above all else, why Louis Vuitton Dak had to give up the name.
Pintz & Partners