Like many companies, Hartmarx Corp., a manufacturer and distributor of high-end apparel, has had a challenging year.  In January, it filed for bankruptcy in the Northern District of Illinois. More recently, on May 21, 2009, it filed a motion requesting permission from a bankruptcy judge to sell its assets to Emerisque Brands UK Ltd. for $85.5 million in an attempt to resolve some of its debts.  That same day, PEI Licensing, Inc., a wholly owned subsidiary of Perry Ellis International filed a six-count suit against Hartmarx  alleging, among other things, trademark infringement.  The case is In re: Hartmarx Corp., et al., Case No. 09-02046 (US District Court for the Northern District of Illinois). 

PEI owns numerous apparel related trademarks, including PERRY ELLIS, PERRY ELLIS PORTFOLIO, PERRY ELLIS AMERICA, and PERRY ELLIS SIGNATURE in the United States. PEI and Hartmarx entered into a license agreement authorizing Hartmarx to exclusively use the PERRY ELLIS marks in the manufacture and distribution of men’s tailored clothing in the United States and Puerto Rico for a period of four years. In exchange for use of the PERRY ELLIS marks, Hartmarx agreed to pay PEI royalties. 

According to the complaint, Hartmarx infringed PEI’s marks by continuing to manufacture and sell PERRY ELLIS branded clothing after the license agreement ended on December 31, 2008. Hartmarx also allegedly failed to make timely royalty payments and provide PEI with required inventory reports. PEI claims that it has been damaged in an amount well in excess of $75,000, which includes unpaid royalties owed by Hartmarx and profits earned by Hartmarx from its unauthorized use of the PERRY ELLIS marks. 

In addition to trademark infringement, the complaint alleges unfair competition, false designation of origin, and trademark dilution.  PEI is seeking injunctive relief, and compensatory damages, including royalties, treble damages for infringement, attorneys’ fees and other costs.

The Arent Fox intellectual property group represents a number of apparel companies in trademark and licensing matters, and is monitoring all developments related to this case as well as similar cases.  

If you have any questions concerning this case, or others, please contact:

Anthony V. Lupo
lupo.anthony@arentfox.com
202.857.6353

David S. Modzeleski
modzeleski.david@arentfox.com
202.857.6073