A U.S. trade agency has agreed to investigate trademark infringement claims brought by Crocs against Skechers, Hobby Lobby and 21 other companies.
The U.S. International Trade Commission (USITC) issued its decision Tuesday, less than a month after Crocs filed its initial complaint requesting an investigation and then general exclusion order and cease and desist orders on the specific footwear products it claims violate it trademarks.
The Broomfield, Colo., clog maker named 23 companies in its complaint. These businesses include major names like Skechers and Hobby Lobby, both of which Crocs alleges design and sell infringing footwear, as well as smaller entities like New York City retailers Loeffler Randall and 718Closeouts and Quanzhou ZhengDe Network Corp., a Fujian, China-based corporation that primarily sells its products through Amazon.
Crocs’ complaint alleges that each of the named companies infringed on two trademarks it has held since 2017, both related to the design of its classic clog.
It further claimed that nine of the accused infringed on its trademarked Crocs name, including Hobby Lobby, which it showed using the phrase “Footwear-Croc Slides” on its packaging; Ink Tee, a Los Angeles-based e-commerce business that identifies its clogs as “Crocs Clog Shoes;” and a footwear seller by the name of Crocksy.
Speaking at Baird’s 2021 Global Consumer, Technology & Services Conference last month, Crocs CEO Andrew Rees said the brand has seen a recent spike in knock-off attempts.
“As the brand has really accelerated here in the U.S. over the last 24 months, we’ve definitely seen an increase in what I would describe as infringing product that is attempting to knock off some of our intellectual property,” Rees said. “We’re looking to be, as I would say, assertive and aggressive in terms of protecting data and ensuring that the consumer gets the benefit of the original product.”
Crocs’ complaint seeks to block imports of all the offending products using section 337 of the Tariff Act of 1930, which prohibits the importation, sale for importation and sale after importation of products that infringe on U.S. trademarks. Almost all of the products named by Crocs are made in China.
The complaint requests the USITC issue a general exclusion order forbidding entry into the U.S. of footwear products that violate one or more of its trademarks. Though it suggested a limited exclusion order just on the infringing footwear products from the named companies as an alternative, Crocs argued the broader general exclusion order is necessary “due to the widespread pattern of infringement.”
Crocs also requested the USITC issue a permanent order directing the named businesses to cease and desist from the importation, marketing, advertising, demonstrating, warehousing of inventory for distribution, sale and use in the United States of imported footwear that violate its trademarks.
The USITC noted that its decision to investigate the case does not mean it has made any decision on the merits of the case. The case, it said, will be assigned to one of the agency’s administrative law judges, which will schedule and hold an evidentiary hearing and then make an initial determination as to whether there is a violation of section 337. This judgement is subject to review by the commission.
The organization said it will make a final determination “at the earliest practicable time.” Within 45 days after the institution of the investigation, the USITC plans to set a target date for completing the investigation.
Crocs’ recent complaint comes a decade after the USITC issued a general exclusion order prohibiting the import of footwear that infringed on two of Crocs’ patents. The order arrived five years after the clog maker’s initial complaint. At the time, only three respondents remained of the initial 11 companies named in the clog maker’s complaint following various settlements and USITC determinations of non-infringement.