Abercrombie & Fitch (NYSE:ANF) is lobbing another legal bomb at rival preppie clothing chain American Eagle Outfitters (NASDAQ:AEOS), this time over the number 22. Abercrombie's smaller surfwear-inspired chain, Hollister, claims that it owns the rights to the use of "22" on its clothes, and that American Eagle should stop using that number on some of its apparel.
You have got to be kidding me.
Hollister never registered a trademark for 22, but claims that it's been using the number on its tees, sweatshirts, and other clothes for the three years it's been in business. The 22, it says, comes from 1922 -- the completely fictional founding date for the business. The company has since "become widely known and recognized by its usage of 22," reads the lawsuit.
I might buy that if Hollister had been exclusively using only the number 22 on its clothes, but that's just not the case. Even a cursory glance at the company's products reveals lots of various numbers being used on clothes: 63, 79, 86, 19, 58, 8, 36, 83, 9, 1972, 4. I could go on since there are more, but you see my point.
Sure, there are some 22s and some 1922s at Hollister but not in great excess compared to the other numbers. Not enough that when I see the number 22, I think of Hollister. (I'm more likely to think of running back Emmitt Smith.) What's more, American Eagle also uses lots of different numbers on their clothes; it's not as if it is only producing tees emblazoned with 22.
A number can legally be protected against trademark infringement, but it requires that the company prove that people associate the number 22 with Hollister, and that seeing it elsewhere would be misleading. I find the possibility of Hollister supporting that argument remote, particularly given that Abercrombie's earlier legal challenges to American Eagle have ended in defeat.
As an Abercrombie & Fitch shareholder, this action disappoints me. I wish the company would put my and other shareholders' money to better use, rather than spending it on this ridiculous lawsuit. Figuring out a way to turn around the long-running same-store sales slump in the flagship stores, for instance, would be a nice start.
I'm not holding my breath, though. Abercrombie's notorious for stirring things up, and this silliness is no different.
Celebrate The Motley Fool's 10th anniversary with 10 Ways to Make More Money Now .
As mentioned above, LouAnn Lofton owns shares of Abercrombie & Fitch. She does not own shares of American Eagle Outfitters.
