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Target to Pay $389,000 in EKB Textiles Copyright Case
Target Corp. has been ordered to pay
more than $389,000 and attorney’s fees to
Los Angeles–based EKB Textiles Inc. following
a recent copyright-infringement trial
in U.S. District Court in Los Angeles.
A jury handed down its verdict on
July 27, said Stephen M. Doniger, who represented
EKB Textiles, also known as Caribbean
Blues Inc. Doniger claims the verdict was
one of the top four largest copyright verdicts
issued by the federal Central District of California
in the past two years. His Culver City,
Calif.–based firm, Doniger/Burroughs APC,
also won a judgment of more than $500,000
for United Fabrics International against retailer
Lane Bryant last year.
“When you realize that it will go to a jury,
you need to respect copyright—or it will cost
you,” Doniger said.
Target’s co-defendants were Kandy Kiss
of California, NC Apparel Inc., LF USA
Inc. and Samsung C&T America Inc. A
LF USA representative said the company has
no comment on the case. Rollin A. Ransom
of the Los Angeles office of Sidley Austin
LLP represented Target in the early part of
the case, which was filed last year. In court
documents, Ransom argued that Target had
not infringed on the rights of EKB and there
was no substantial similarity between the fabric
represented by EKB and the print that was
sold at Target.
The trial focused on EKB print #4644, a
floral/paisley print with a geometric border
pattern.
EKB had sold the design to various manufacturers,
who then used the print to make
various womenswear styles. In 2010, an EKB
employee found the print being sold at a
Southern California Target store for a beach
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2 CALIFORNIA APPAREL NEWS August 5–11, 2011
NEWS
Side by Side: EKB’s fabric is pictured on left,
and Target’s “Beachy Keen” dress is pictured
on right.
coverup dress, called the “Beachy Keen,”
which was sold under Target’s private-label
brand Xhilartion. The colors, layout and the
composition of the design remained the same,
but a few details were changed. Specifically,
some of the flowers in the EKB design were
changed to diamond shapes, according to
Doniger.
EKB’s suit was filed last year, and a ceaseand-desist
letter was sent to Target in March
2010. The retailer replied, saying it would
look into the matter, according to Doniger,
who said Target sold out of items using the
EKB print by July.
The number of copyright-infringement
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cases has been increasing for the past decade,
according to Crystal A. Zarpas of law firm
Mann & Zarpas LLP. In such cases, juries
and judges must determine if defendants have
access to the original work and whether the
original work and the alleged copy are substantially
similar.
Changing a few details of the original design
is not a guarantee against a copyrightinfringement
claim. “There is no 30 percent
rule, as many in the industry falsely believe,”
Zarpas said.
Copyright-infringement cases have increased
because of the ease of registering
a copyright, said Frank J. Colucci of New
York–based intellectual-property-rights firm
Colucci & Umans.
“We do not believe that there is any discernible
pattern in jury verdicts,” Colucci
said. However, big retailers can find themselves
at a disadvantage because of their large
volume of vendors. “Target sells numerous
products that they obtain from vendors and
other parties whose policies with respect to
copyrighted works may not be as stringent as
theirs,” Colucci said.—Andrew Asch
China/Costa
Rica Free-Trade
Agreement Begins
China has free-trade agreements with Peru
and Chile in South America, but on Aug. 1,
the international trade giant kicked off its
first free-trade pact with a Central American
country.
The new free-trade agreement between
China and Costa Rica, countries that signed
an accord more than a year ago, has gone into
effect.
China’s major exports to Costa Rica include
textiles, machines, electric appliances,
vegetables, fruits, cars, chemical products,
raw fur and leather. Costa Rica’s chief exports
to China are coffee, beef, pork, fruit
juices and jam.
Last year, Costa Rica imported $25.5 million
in textiles from China, according to the
Costa Rica Department of Commerce.
Chinese fabrics are not allowed to be used
for duty-free goods coming in from Costa
Rica to the United States. The only exception
is if they are under the short-supply list approved
by the member countries of the freetrade
agreement. The China/Costa Rica freetrade
agreement could make short-supply
textiles cheaper in Costa Rica because they
wouldn’t be subject to tariffs. But Nicaragua
already has trade-preference levels, allowing
them a certain amount of outside fabric to be
used in garments sent to the United States.
The new agreement means about 60 percent
of the two countries’ products immediately
will be duty-free. Tariffs on another 30 percent
of goods will gradually expire after five
to 15 years.
In addition to tariff-free entries for products,
the two countries have agreed to open
their service sectors. Costa Rica will allow
free service trades in 45 sectors, including
telecommunications, business services, construction,
real estate, distribution, education,
environment services, information-technology
services and tourism, while China will
open seven sectors in return, including IT
services, real estate, market research, translation
and interpretation, and sports.
In 2010, the value of bilateral trade between
the two countries was $3.8 billion, a
19 percent jump over 2009. China, which received
$3.1 billion in goods from Costa Rica
in 2010, has become the Central American
country’s second-largest export market, after
the United States.—Deborah Belgum
WEEK
In RevIew
California
Levi’s gets strategic. San Francisco–
based Levi Strauss & Co. named Beto
Guajardo global vice president of strategy.
Guajardo was most recently vice
president of North America strategy for
Avon. He also served as vice president
of global sales strategy and vice president
of Asia Pacific strategy and new
business development for the direct-toconsumer
beauty brand.
R&R auction a hit. The asset auction
of luxury cars, jeans and sewing equipment
once owned by Los Angeles–
based denim brand Rock & Republic
was a hit, according to Great American
Group LLC, the Woodland Hills–
based asset-disposition and appraisal
company that conducted the auction.
The sale drew more than 500 registered
buyers and a standing-room-only
crowd for the July 26 auction, according
to Great American Group, which
described it as one of its most popular
auctions held. Among the auction
highlights was a 1965 Shelby Mustang
GT 350 SR, which sold for $141,250.
Rock & Republic filed for bankruptcy
protection last year. Earlier this year,
the brand was acquired for $57 million
by Greensboro, N.C.–based VF Corp.,
which inked an exclusive licensing deal
for the Rock & Republic label with
Kohl’s Corp.
SMP turns 1. Upscale lifestyle mall
Santa Monica Place is celebrating the
one-year anniversary of its renovation
with three days of shopping promotions
and restaurant deals beginning Aug. 5.
Nearly two years of construction and
a $265 million budget transformed
the 1980s-era enclosed shopping mall,
designed by Frank Gehry, into a threelevel
luxury open-air retail and dining
district with sweeping views of the
beach and the Pacific Ocean. Owned by
Macerich Co., the retail center features
a mix of upscale chain and independent
retail, including Bloomingdale’s, Nordstrom,
CB2, Nike, Louis Vuitton, Tiffany
& Co, Burberry Brit, Tory Burch,
Barneys Co-Op, Michael Kors and Kitson,
among other retail attractions.
International
Gap opens in Rome. San Francisco–
based Gap Inc. opened its first Gap flagship
store in Rome on Via del Corso.
Last year, the company opened its first
Gap and Banana Republic stores in Milan
and launched an e-commerce website
tailored to the European market.
Quote of the Week
Narco-beauty: That’s what the
fake boobs and bums are about.
Drug traffickers want this kind
of femininity—and very young
women go along with it because
they think it is a passport to
a better life. … But today,
we are pushing women to be
financially independent and opt
for a different kind of elegance.
—Lila Ochoa, editor in chief of Colombian
women’s magazine Fucsia, talking to Vogue
at Colombiamoda in Medellin