Seoul repair shop wins Louis Vuitton trademark case over bag refits

People walk past a Louis Vuitton store in Seoul, Jan. 17. Newsis

Korea’s Supreme Court ruled Wednesday that refashioning luxury handbags at a customer’s request for personal use does not constitute trademark infringement, overturning lower court rulings in a case brought by Louis Vuitton against a local repair shop.

The Supreme Court’s Second Division sent the case back to the Patent Court, finding that modifying a branded product for personal use does not amount to “use of a trademark” under Korean law if the refashioned item is not distributed commercially.

The case involved a repair shop operator in Seoul’s upscale Gangnam district who altered customers’ worn Louis Vuitton bags into smaller bags and wallets between 2017 and 2021. The operator charged between 100,000 won ($70) and 700,000 won per item, earning a total of 23.8 million won.

Louis Vuitton filed a lawsuit in February 2022, arguing that in the course of producing items bearing the Louis Vuitton mark, the operator had undermined the trademark’s functions, including its role in indicating the source of the goods and guaranteeing quality.

The operator countered that the work consisted only of refashioning the bags to match the form and intended use requested by each bag’s owner, were not produced repeatedly (i.e., not mass-produced), were not intended for distribution and had no market circulation. On that basis, the operator argued that the refashioned items did not qualify as “goods” under the Trademark Act.

A trial court ordered the operator to pay 15 million won in damages, finding that the refashioned products retained independent commercial value and could circulate in the second-hand market. An appeals court affirmed that ruling in October 2024.

The Supreme Court disagreed, saying “As long as the refashioned product is not offered in commercial transactions and is used solely for personal purposes, displaying the trademark on such a product does not constitute use of the trademark.”

The court also set out criteria for determining when refashioning could constitute trademark infringement.

It said infringement may arise in “special circumstances,” such as when a refashioning operator takes the lead in the process and produces and sells refashioned goods for distribution in the marketplace.

In determining whether such “special circumstances” exist, the justices said courts should consider factors including where the refashioning request originated and what it involved; who had final decision-making authority over the product’s purpose, form and quantity; the source of the materials used and the proportion they account for in the finished product; and ownership of the items.

The court added that the trademark holder bears the burden of proving the existence of such special circumstances.

The justices described the case as legally significant with broad social implications, noting that it had been closely watched in the United States, Europe and Japan.

A public hearing was held in December and the court heard expert testimony from both sides before issuing the ruling.

This article from the Hankook Ilbo, the sister publication of The Korea Times, is translated by a generative AI system and edited by The Korea Times.