Russell, Yurman win on copyright issues, Yurman to appeal trade dress ruling

Two well-known designers have gotten mixed results from federal judges in their efforts to defend their popular jewelry designs.

A federal jury in St. Paul, Minn., upheld Minnesota designer Janel Russell’s lawsuit for copyright infringement of her “Mother and Child” designs, which have sold more than one million pieces of jewelry worldwide since the mid-1980s. The defendants settled out of court and won’t appeal.

Designer David Yurman, New York, saw his copyright infringement claims against Prime Art & Jewel (PAJ), Dallas, Texas, upheld by the U.S. Second Circuit Court of Appeals, in New York. However, the appeals court-claiming Yurman’s “inability to articulate” features of its trade dress [i.e., distinguishing look or design of a product]”-overturned the trade dress protection and compensation for unfair competition which Yurman had won against PAJ in the lower court.

Yurman lawyers say the court is creating new law, and will either ask the court to rehear the case or appeal to the U.S. Supreme Court. A decision will be made before the month’s end.

Ironically, the court judgments in both cases were handed down Aug. 10.

Russell’s case. Russell created her “Mother and Child” design-an egg-shaped abstract of a mother and child embracing-in 1980. More than one million gold and silver pieces of jewelry using it-made and distributed by the Kirchner Corp. and Carla Corp. in the United States and The Gold Connection (TGC) in the United Kingdom-have been sold since 1981 to retailers worldwide.

Since 1984, her lawyers have sent warnings to some 160 retailers and manufacturers selling infringements on her design. Most comply, but some don’t. Russell has successfully sued 14 times in the United States, Holland, South Africa, and Canada to stop them. The most recent victory was this August.

In 1999, Russell sued manufacturer Museum Reproductions Inc., of Brookline, Mass., and Rivertown Trading Corp., a St. Paul, Minn., firm, which publishes merchandise catalogs, for copyright infringement. The suit claimed “Shona Mother and Child” jewelry they sold too-closely resembled Russell’s design.

During the trial in St. Paul, Minn., federal court, Museum Reproductions said its jewelry was based on statuary of the Shona people of Zimbabwe, Africa. However, the jury found the defendants guilty of infringement. They were “permanently enjoined” from making, importing, or selling jewelry “incorporating” or using “a design substantially similar to [Russell’s] Mother and Child work, the Shona Mother and Child . or any derivative thereof.”

Despite loss of sales and high legal costs, the judge set a $60,000 cap on damages due to Russell. The defendants settled out of court for $50,000; both sides paid their own legal costs. It was an expensive victory for Russell, “the largest financial loss of this kind I’ve had.” Indeed, all her court victories have cost her (legal expenses, small settlements, etc.).

But, Russell says she has “an obligation” to protect her copyright both for herself, and for all who benefit form it-including manufacturers, their employees, retailers, and consumers. “It affects a lot of people” who would lose jobs, revenues or business if infringers go unchallenged, she says.

Yurman vs. PAJ. In December 1998, Yurman Design Inc. sued PAJ for copyright and trade dress infringement in making and selling twisted, multi-strand cable and gemstone jewelry which allegedly looked like Yurman’s. It also sought a permanent injunction.

In November 1999, a New York federal court jury cited PAJ for copyright infringement, trade dress infringement and unfair competition under New York law. It also said Yurman’s trade dress [i.e., the “look” of the jewelry] was distinctive enough for protection under trademark law, a first for an American jewelry designer. It ordered PAJ to pay Yurman $275,000 in damages for copyright infringement and $800,000 in punitive damages under unfair competition laws of New York state, for trade dress violation. Together, they constituted one of the highest awards made in any case involving trade dress.

Early last year, a judge upheld the jury’s findings that certain PAJ jewelry infringed on Yurman copyrights and trade dress; that Yurman jewelry possessed protectable trade dress; enjoined PAJ from manufacturing, distributing or selling the infringing jewelry, and ordered it to destroy all such pieces it possessed.

However, he voided the $800,000 as “excessive” (while upholding the $275,000) and denied Yurman’s request for an encompassing injunction against sale of cable design jewelry due to the “difficulty” in verbally defining Yurman’s trade dress “precisely.” Both Yurman and PAJ appealed to the U.S. Second Circuit Court of Appeals. Their case was heard by a three-judge panel in February, and a decision handed down Aug. 10.

The appeals court upheld the jury’s decisions on copyright infringements of Yurman’s designs-“the first time David Yurman jewelry has been found by an appeals court to be original and protectable,” says Maxim H. Waldbaum, Yurman’s attorney. (Yurman has also just collected the $275,000 damages, plus interest, for the infringement, he says.)

However, the court overturned the jury’s decision that Yurman deserved trade dress protection and (since the anti-competition damages were based on the trade dress issue), the $800,000 judgment as well. The reason, it said, was Yurman’s “inability to articulate the trade dress” of its jewelry.”

PAJ officials called ruling a victory, and contend it has “sweeping, industry-wide implications” because of Yurman’s “efforts to erect trade dress barriers in the cable jewelry area.” Yurman’s trade dress claims, they say in a company statement, are “nothing more than a thinly-veiled attempt to capture trade dress protection for all cable jewelry.”

However, Waldbaum contends the court is creating “new law” and ignores “the evidence the jury had of trade dress violations, including visual identification. The court says `You must articulate what your trade dress is,’ even though trademark law allows use of all five senses,” he says.

The court gave this ruling, he claims, because “it wants to send its own message about trade dress, which is, that it is more important to have free competition, than it is to protect artists’ trade dress rights.”

Waldbaum said Yurman Design Inc. will appeal, but at press time he was uncertain whether his client will ask the Appeals Court to rehear the case (it rarely does) or appeal to the U.S. Supreme Court.

In a related story, Yurman has closed its account with Haltom’s, of Houston retailer, which sold more than $1 million of Yurman jewelry annually at its four locations. Yurman alleges that Haltom’s transshipped its jewelry to “unauthorized retailer Diamonds and Time,” also in Houston. Transshipping-which is the distribution of product to unauthorized dealers-is prohibited in Yurman’s “Authorized Retailer Agreements” with some 250 retailers worldwide. Yurman ended the business relationship “as a sign of its commitment to protecting its brand and retailers from unauthorized distribution,” said a company statement.

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