Supreme Court Hears Oral Argument in Already LLC v. Nike, Inc.
On Wednesday, the Supreme Court heard oral argument in the case of Already, LLC d/b/a Yums v. Nike, Inc. As we reported previously, that case arose from an appeal of the Second Circuit’s decision affirming the Southern District of New York’s holding that a covenant not to sue entered in a trademark dispute ended the case and controversy between the parties. We enclose the full transcript of the oral argument.
During oral argument, at which this author was present, Already, LLC d/b/a Yums’ (“Yums”) attorney argued that the covenant would force it to be the "involuntary licensee" of Nike. He analogized the challenged registration to a scarecrow, arguing that it creates "informational injury" by improperly stopping competitors from producing similar shoes, under color of right.
Significantly, Nike’s covenant not-to-sue only extended to claims based on Yums’ current and past products and "colorable imitations" thereof. It did not preclude that Yums might later be sued based on the challenged registration for other shoe designs.