Just Sue it!
by Eran Soroker & Devorah Spigelman
What do you do if a Goliath such as Nike uses your trademarks unlawfully? If you follow Nike’s motto, you Just Sue Them. Many would be intimidated to take on the leading athletic company, but not Efraim Nathan. Here is his David & Goliath story.
Nathan, a former Israeli now residing in Pennsylvania, is the proud owner of Sweat It Out, an athleticwear company known for its Cool Compression technology. This technology allows the fabric to stretch along muscles and reduce the risk of athletic injury by redistributing pressure. Nathan’s sport apparel is a favorite among professional athletes and their trainers, including trainers for the NFL, NHL, MLB, and NBA.
Nathan launched his company, formally known as Lontex Corp. in 1989 and later, in 2008 registered “Cool Compression” as a trademark. The Sweat It Out brand put Lontex on the map as time and time again athletes chose Sweat It Out as their preferred sportswear brand. In 2015 Lontex became aware that Nike had introduced their own new line of Cool Compression gear. Lontex claimed that Nike was in violation of the Lanham Act and unfair competition for their use of Lontex’s “Cool Compression” trademark without authorization. After many long rounds of negotiations, Nike agreed to cease its sales of the Cool Compression gear yet took no action to this effect.
In 2019 Lontex filed a lawsuit against Nike, alleging trademark infringement and seeking $2 million for Nike’s actions, which they called: “malicious, fraudulent, deliberate and willful, and taken in bad faith”.
Nike’s defense was based on the claim that Lontex abandoned the Cool Compression mark, however the court rejected Nike’s defense as the Court found that the mark is still in use.
After 11 days of deliberations, the jury found that use of the mark Cool Compression on Nike garments causes likelihood of confusion with the Sweat It Out apparel. The Court ruled in Lontex’s favor, awarding the company $507,000 for Nike’s willful infringement as well as liability under contributory infringement and lack of fair use.
Nathan’s success illustrates the importance of protecting your intellectual property even when you are a David, for Goliath may be lurking around the corner!