Huntington Beach surfwear maker Quiksilver Inc. is headed to court against a Los Angeles company in a dispute over its Roxy brand of clothes.
Quiksilver is suing Kymsta Corp. over its Roxywear by Roxx clothing line, citing trademark infringement. The two are set to meet in court in November.
The company first sued Kymsta in 2002, prompting a counter suit from Kymsta contending its Roxywear name was used before Quiksilver made Roxy a distinct brand.
Quiksilver disputes that, saying it prevailed in a trial a few years ago in which the judge ruled the evidence presented by Kymsta wasn’t strong enough to present to a jury. Kymsta won a second trial on appeal.
“We are very confident we will prevail this time too,” said Charles Exon, Quiksilver’s general counsel.
James Nguyen, a partner at Foley & Lardner LLP in Los Angeles who is representing Kymsta, calls it a “David and Goliath type of situation.”
Kymsta, with yearly sales of $4 million, is mismatched in the fight. Quiksilver has $2 billion in yearly revenue and could run circles around Kymsta in terms of spending money in court.
But sources close to Quiksilver’s thinking call it a case of a small company seeking a settlement from a bigger one.
Kymsta is open to a settlement, according to Nguyen.
“I think it’s safe to say that everyone involved with this case wants to see some kind of conclusion earlier than later,” he said.
Quiksilver, which has tapped Irvine’s Knobbe Martens Olson & Bear LLP and O’Melveny & Myers LLP in Newport Beach for the case, wants to fight it on principle, said a source familiar with the situation.
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Quiksilver: started out as “Quiksilver Roxy” to help identify brand |
Top Female Surf Line
The company’s Roxy brand is the premier line of surf-inspired clothes for girls and women. It’s the model for surfwear makers looking to grow by selling more clothes to females.
Roxy made up 27% of Quiksilver’s $600 million in sales for the quarter ended April 30. It outsells the company’s flagship Quiksilver brand for guys in the U.S.
Nguyen argues Quiksilver could have to rename its Roxy line if it loses. Quiksilver disputes that, saying its right to the name was established in the first trial.
Roxywear by Roxx is a mix of shirts and tank tops that sell for about $100 at Bloomingdale’s, Barneys and other stores.
Quiksilver’s Roxy clothes and accessories target girls and are sold in stores of Anaheim-based Pacific Sunwear of California Inc., Nordstrom, Quiksilver’s own shops as well as others.
The company is said to have approached Kymsta with concerns about the brand around 2002 when it started showing up at Nordstrom and Delia’s, a catalog retailer.
Quiksilver sought a deal to limit the use of the Roxywear brand to prevent conflicts with Roxy, according to sources. The two weren’t able to come to terms.
In 2004, a judge sided with Quiksilver by ruling there weren’t enough conflicting facts for a jury to weigh in on.
“The evidence was so one-sided,” said Michael Yoder, partner in charge of litigation at the Newport Beach office of O’Melveny & Myers who argued for Quiksilver the first time and is set to again in November.
As part of the ruling, Kymsta was allowed to keep using the Roxywear by Roxx brand as it had,only on tags sewn into the inside of its clothes. The company couldn’t license the name or put it on tags attached to the outside of clothes.
Kymsta appealed.
It won a round when the U.S. Court of Appeals for the 9th Circuit said some issues should go before a jury: the matter of who first used the Roxy name, and if Quiksilver used Roxy as a stand-alone brand before Kymsta had.
This time around, Quiksilver is pushing for a ban on Kymsta’s use of the Roxy name.
Who Used First?
Both companies started selling clothes under brands that used the word “Roxy” in the early 1990s.
Kymsta Cofounder Roxanne Heptner started making women’s clothes under the Roxywear brand in early 1992. The name later was changed to Roxywear by Roxanne Heptner and eventually became Roxywear by Roxx.
Quiksilver insists it was the first to use the Roxy name when it started selling the clothes in the early 1990s under “Quiksilver Roxy,” according to court documents.
It cites 1992 as the earliest date the brand was used.
The early line included shorts and T-shirts with the words Roxy and Quiksilver printed on them. Original posters and tags for the brand used both Roxy and Quiksilver. The company applied for a registered trademark for the Quiksilver Roxy brand in 1996, which was granted in 1997.
In 1998, Quiksilver applied for another trademark just for the Roxy name, citing the brand’s first-use date as of “at least as early as Jan. 1, 1992.” The “Roxy” brand was trademarked in early 2001.
Court records show that Quiksilver used the word “Quiksilver” in its original “Quiksilver Roxy” brand because it wanted to associate Roxy with Quiksilver to help build up the fledgling line.
Quiksilver Chief Executive Bob McKnight and Danny Kwock, president of Quiksilver Entertainment, testified in the first trial that they were concerned that “no one would know who Roxy was at the time,” which was why they linked Roxy with Quiksilver, according to court records.
Nguyen argues that Quiksilver wasn’t the first company to use the word Roxy because Kymsta already had used Roxy in its brand for six years before Quiksilver applied for a trademark. He also argues Quiksilver waited too long to sue Kymsta.
