Inditex – the parent company of fashion giant Zara – sued a small New York-based brand over the use of the mark Zara Terez (“ZT”). Zara Terez was launched in 2008 by friends Zara Terez Tisch and Amanda Schabes. The complaint alleged that “ZT’s trademark is likely to create, and has created, confusion in the marketplace as to the affiliation between the parties and is likely to dilute, and has diluted, the Zara trademarks.” ZT filed a trademark application with the United States Patent and Trademark Office, but the application was refused registration based on Inditex’s prior registrations for ZARA.
Although not alleged in the complaint, one has to assume that ZT did not conduct even a preliminary search of the USPTO’s online database prior to filing the application for ZARA TEREZ. Rather, the owners of ZT poured about 7 years to money and effort in promoting and building goodwill in their brand. This aspect of rebranding is often over shadowed by the actual costs of having to change signage, reprint letterhead, etc., which in Zara Terez’s case may have been manageable. But the cost to re-educate consumers about a brand can be much more involved, and is a cost that could have been avoided with even a basic search of the United States Patent and Trademark Office.