The Legal Implications of the Upcycling Craze

Have you ever wondered how there are so many businesses selling “Louis Vuitton” key chains or “Gucci” wallets for a price that seems too good to be true? Chances are, it is too good to be true, and the seemingly designer item being sold for a reasonable price, is just another one of the hundreds of counterfeit sellers, disguising themselves as an “upcycler,” in the United States today. Every few years, we see the rise and fall of many fashion trends, and currently, we are experiencing the fad of the upcycling and secondary resale market craze.¹[1]Emily Chan, Upcycling is the Biggest Trend in Fashion Right Now, BRITISH VOGUE (Nov. 23, 2020), https://www.vogue.co.uk/fashion/article/upcycling-trend-ss21. This trend creates more affordable options for luxury items, contributes to making fashion a more sustainable industry, and broadens the reach of luxury goods to consumers.²[2]See Id. For those who cannot afford expensive designer items, consumers have started to veer down multiple different avenues to obtain “luxury goods” that will not break the bank.³[3]Michelle Russell, Fashion Resale Market Grows as Cost-Conscious Consumer Emerges, JUSTSTYLE (Oct. 11, 2022), https://www.just-style.com/features/fashion-resale-market-grows-as-cost-conscious-consumer-emerges/?cf-view&cf-closed. Companies and individuals, whether they are selling on etsy.com⁴[4]ETSY, https://www.etsy.com/about?ref=ftr (last visited Oct. 26, 2023) (Etsy is a global online marketplace, where people come together to make, sell, buy, and collect unique items). , through Instagram, or via their own website, are taking remnants of designer items, adding them to their products, and selling the newly formed item for a cheaper price than the original designer items.⁵[5]https://instagram.com/onetwelvess?igshid=MzRlODBiNWFlZA== (For example, a company called “One-Twelves” cuts up leather bags from Louis Vuitton, Dior, Fendi, and Gucci, and replaces the Nike swoosh or other parts of the shoe, on Nike Air Force 1’s, Nike High Dunks, Nike Low Dunks, Doc Martins, and Birkenstocks); https://www.etsy.com/listing/1531408028/repurposed-button-necklace-featuring-a?ga_order=most_relevant&ga_search_type=all&ga_view_type=gallery&ga_search_query=chanel+button+necklace&ref=sr_gallery-1-4&frs=1&organic_search_click=1 (Another major upcycling trend is taking old Chanel buttons from jackets, suits, or sweaters, and putting them on a chain to sell as “a vintage Chanel” necklace). While all of this might seem harmless, each time a designer item is “repurposed,” the intellectual property (“IP”) of the brand is infringed upon and compromised.⁶[6]Eda Stark, The Implications of Upcycling Products for Brand and Trademark Owners, IP WATCHDOG (June 27, 2023, 7:15 AM), https://ipwatchdog.com/2023/06/27/implications-upcycled-products-brand-trademark-owners/id=162671/#. This article examines the differences between upcycling, resale markets, and what brands can learn from two key cases to protect their IP.

Unraveling the Threads of Upcycling

Upcycling is the act of converting old or “vintage” resources into value-added goods.⁷[7]Id. For example, typical items used in upcycled products include buttons, zippers, leather, and other components from the original designer items that are reworked into jewelry pieces, accessories, and clothing items.⁸[8]Id. In addition to creating a more affordable option for consumers to purchase “luxury items,” upcycling promotes sustainable fashion by using existing materials and products already in circulation.⁹[9]Id. There are two main components to an upcycled product: (1) the original piece and (2) the modified subsequent piece with added value.¹⁰[10]Id. For example, the leather from just one Louis Vuitton bag can create dozens of upcycled products, by including the leather as patches on hats, handbags, or can even use the leather to make a handful of keychains.¹¹[11]Id. In recent issues, Vogue magazine has described upcycling as the biggest fashion trend of spring/summer.¹²[12]Chan, supra note 1. Further, as of June 2023, the hashtag #upcycle has over 6.2 million posts on Instagram alone.¹³[13]Stark, supra note 6.

In Louis Vuitton Malletier S.A.S. v. Sandra Ling Designs, Inc., Sandra Ling, an upcycle designer who made everything from keychains, to beanies, to jackets, using multiple different Louis Vuitton trademarks, took the heat of a lawsuit from Louis Vuitton for using its mark without authorization or a license.¹⁴[14]Louis Vuitton Malletier S.A.S. v. Sandra Ling Designs, Inc., No. 4:21-CV-352, 2021 U.S. Dist. LEXIS 160011 (S.D. Tex. Aug. 24, 2021). Louis Vuitton argued that consumers are likely to mistakenly believe the products sold by Ling are authentic Louis Vuitton items or are otherwise authorized or approved by Louis Vuitton.¹⁵[15]See Id. Ling eventually agreed to a permanent injunction against her use of Louis Vuitton marks on her products and to pay damages to Louis Vuitton in the amount of $603,000.¹⁶[16]Stark, supra note 4. While this was a win for Louis Vuitton, there are thousands of designers out there who are doing the same thing.¹⁷[17]See Id. Therefore, it is a constant struggle for brands like Louis Vuitton to decide what upcyclers to pursue in court and which to leave be.¹⁸[18]See Id.

A New Life for Loved Items – The Ins and Outs of Secondary/Resale Markets

Reselling old items for a profit is not a new concept.¹⁹[19]Russell, supra note 3. Thrift stores and consignment shops have been around for years.²⁰[20]Id. However, experts say that since 2016 the interest in resale markets has skyrocketed due to market accessibility, more reasonable pricing, and consumer concern for environmental sustainability.²¹[21]Id. Websites and apps like Depop²²[22]Depop, https://www.depop.com (last visited Oct. 26, 2023) (Depop describes itself as a place where millions of users come to celebrate their style and discover culture, as a wholly owned subsidiary of Etsy)., Poshmark²³[23]Poshmark, https://poshmark.com/about (last visited Oct. 26, 2023) (Poshmark describes itself as the leading social marketplace for new and secondhand style for women, men, kids, pets, home, and more)., and TheRealReal²⁴[24]THEREALREAL, https://www.therealreal.com/about (last visited Oct. 26, 2023) (TheRealReal describes itself as the world’s largest and most trusted resource for authenticated luxury resale)., — places where consumers can buy gently used items and sell their own desirable luxury items–are some of the driving forces behind the increased interest.²⁵[25]Russell, supra note 3.

However, due to the resurgence of secondary markets and the creation of the upcycling trend, a slew of legal obligations follows. When reselling luxury items, or an upcycled product, there is an obligation on resellers of trademarked goods to not sell the products in a way that would suggest to consumers that they are connected to the trademark owner, otherwise the reseller is opening him or herself up to the possibility of being sued.²⁶[26]Stark, supra note 6 (Such as selling old Louis Vuitton leather and making it into keychains. Because Louis Vuitton did not originally make the keychain with their trademarked logo on it, consumers will likely be confused as to where the good originally came from).

Trademark Infringement in Upcycled Products on the Secondary Markets

Rolex Watch U.S.A., Inc. v. BeckerTime is a good example of the intersection of secondary markets and trademark infringement in upcycled products.²⁷[27]Rolex Watch U.S.A., Inc. v. BeckerTime, LLC, No. 4:20-cv-01060, 2022 U.S. Dist. LEXIS 16560, at *2 (N.D. Tex. Jan. 31, 2022). BeckerTime is a company that now only sells preowned watches, but at the time they upcycled watches, creating hybrid watches using Rolex and third-party parts, marketing them as “genuine Rolex” watches.²⁸[28]Stark, supra note 4. However, because Rolex had never certified or endorsed BeckerTime, by marketing the watches as “genuine Rolex’s” was an infringement on Rolex’s IP.²⁹[29]Id. In 2020, Rolex sued BeckerTime, alleging counterfeit and infringing use of Rolex’s trademark in connection with the advertising, promotion, service, and sale of unauthorized watches and watch parts.³⁰[30]See Id.

The Northern District of Texas ruled in favor of Rolex, granting a permanent injunction against BeckerTime.³¹[31]Id. The court found that BeckerTime had violated Rolex’s trademarks by upcycling and selling the watches, crafted in part from Rolex watches, and selling them as “genuine Rolex” watches.³²[32]Beckertime, No. 4:20-cv-01060, 2022 U.S. Dist. LEXIS 16560, at *22. Again, like Louis Vuitton³³[33]Louis Vuitton, No. 4:21-CV-352, 2021 U.S. Dist. LEXIS 160011 (2021)., this is one example of hundreds of people infringing on dozens of brand’s IP.³⁴[34]Stark, supra note 4. It is a “whack-a-mole” situation because as one upcycling infringer is taken down, a new one pops up.³⁵[35]See id.

What Is a Brand’s Best Option for Protection?

Unfortunately, the burden is on the brand to police the internet for the multitude of upcyclers across many different platforms.³⁶[36]See id. This is less of a burden for large brands like Louis Vuitton that have more of a bandwidth to regularly police the downstream use of its trademarks, however, smaller brands may find protecting their trademarks to be burdensome.³⁷[37]Kyle Bailey, Intellectual Property For Small Businesses: What Every SMB Needs to Know, FORBES (July 14, 2022), https://www.forbes.com/sites/forbesbusinesscouncil/2022/07/14/intellectual-property-for-small-businesses-what-every-smb-needs-to-know/?sh=48a917a7727f, Typically, brands resort to a bevy of tools to protect their IP.³⁸[38]Stark, supra note 4. The first step is low lifting enforcement, such as cease and desist letters, take-down requests, or casual discussions between the two companies.³⁹[39]Id. If there is no response, then brands will often resort to court involvement, looking for injunctions and/or will attempt to obtain orders requiring the destruction or forfeiture of the remaining infringing articles.⁴⁰[40]Id.

Louis Vuitton⁴¹[41]Louis Vuitton, No. 4:21-CV-352, 2021 U.S. Dist. LEXIS 160011 (2021). and Rolex⁴²[42]Beckertime, No. 4:20-cv-01060, 2022 U.S. Dist. LEXIS 16560 (2022). appear to lay out the framework for brands to follow in order to successfully protect their trademarks.⁴³[43]Stark, supra note 4. Due to this persistent threat to brands, they must continue shelling out the money and personnel to protect their products.⁴⁴[44]Id. Ultimately, upcycling helps further the goal of reducing the carbon footprint the fashion industry has left and continues to leave, and broadens the access to what consumers may consider luxury goods, but these upcyclers will likely continue to see an increase in lawsuits if they continue down the road they are currently on.⁴⁵[45]See id.

Written by: Emily Slavkin
Emily is a 2L at Brooklyn Law School.