A Supreme Court ruling in South Korea has determined that providing services to “reform” luxury bags into different-shaped bags or wallets does not constitute trademark infringement. This decision overturns a lower court’s ruling that had deemed the practice as trademark infringement.
In a case involving a reform artist, A, who was sued by Louis Vuitton for trademark infringement, the Supreme Court second division (presided by Justice Kwon Young-joon) nullified the original court’s partial ruling in favor of the plaintiff and remanded the case to the Patent Court.
The Supreme Court accepted the reform firm’s argument that the act of reforming a bag for the owner’s personal use does not conventionally constitute trademark infringement. The court stated that the reform artist, A, took requests to reform bags for personal use from the owners, completed the reforms, and returned the items to the owners. Even if the registered trademarks appeared on the reformed products, this does not necessarily equate to “use of a trademark” as defined by trademark law. Thus, A’s reform activities do not violate Louis Vuitton’s trademark rights.
However, the court noted that if a reform artist leads the reform process to produce and sell items as their own products in the market, it could be an exception where trademark infringement might apply.
The case gained attention after a video uploaded five years ago featured a Louis Vuitton Big Bag, transformed into a mini bag through reform, garnering significant interest online. The YouTuber got the mini bag for just 450,000 KRW, while a similar “sold-out” Louis Vuitton item cost 2 million KRW in retail. Seeing this, Louis Vuitton launched a lawsuit against reform artist A in 2022 for trademark infringement and damages.
The reform company had been transforming Louis Vuitton bags into wallets and differently shaped bags for their clients between 2017 and 2021, charging 100,000 to 700,000 KRW per item for the service. Louis Vuitton argued that showing their trademarks on leather during the reform process constituted trademark infringement, while A’s side contended that reforms for personal use do not violate trademark rights.
Both the first and second instances ruled in favor of Louis Vuitton, ordering A to pay 15 million KRW for damages, concluding that the reform products were viewed as “goods” with exchange value. The first instance court felt that since the reform products prominently displayed Louis Vuitton’s trademarks on its outer material, it confused the source from a consumer’s perspective.
The reform company argued that trademark rights were exercised once when a product was initially sold, and a rights holder cannot control how an owner chooses to modify their bag. The company stressed that the reformed products were returned only to the ordering client and were not sold separately. Nonetheless, their appeal was dismissed at the appellate court, affirming the initial court’s decision that reforming products in a way that visibly displayed the trademarks could mislead consumers into thinking the products were genuine Louis Vuitton items.