In January 2024, UNIQLO CO., LTD. (UNIQLO) announced that it had filed a lawsuit before the Tokyo District Court against Roadget Business Pte. Ltd., Fashion Choice Pte. Ltd., and SHEIN Japan Co., Ltd. (collectively, SHEIN Parties). UNIQLO alleges that the SHEIN Parties have infringed Japan’s Unfair Competition Prevention Act by selling dupes of UNIQLO’s popular round mini shoulder bag, which went viral on TikTok last year due to its minimalistic, water-repellent exterior and ability to hold a surprisingly large volume of products for its size. UNIQLO is demanding that the SHEIN parties cease selling the dupe bags and pay damages incurred as a result of sale of the SHEIN Parties’ dupe products.

This case will be of particular note to our clients in the fashion and beauty industries, who are concerned about the rising popularity of dupe products and the actions of copycat brands such as SHEIN.

It is interesting that this lawsuit has been raised under the grounds of unfair competition, which appears to have been pursued given UNIQLO has no design registrations relating to the round mini shoulder bag.

Relevantly, under Japan’s Unfair Competition Prevention Act:

• “Unfair competition” is defined as the act of selling, renting, exporting, or importing, etc. a product imitating the form of another person’s product (Article 2, Paragraph 1(4));
• “Imitating” is defined as the act of creating a product substantially identical in form to another person’s product, relying on the form of that person’s product (Article 2, Paragraph 5);
• The plaintiff is entitled to demand that the allegedly infringing party cease the sale, rent, export or import of the imitating product (Article 3, Paragraph 1); and
• If unfair competition is found, the allegedly infringing party must compensate for the damages incurred by the plaintiff (Article 4).

For UNIQLO to succeed in the lawsuit, it must demonstrate that the SHEIN Parties relied on the form of UNIQLO’s product to create their products. This bar is much higher than the bar for a designs infringement case. The SHEIN Parties will likely argue that they created their products independently, and did not rely on the form of the UNIQLO’s product.

The grounds raised in this case demonstrate that the filing of design applications prior to launching a product for innovative new fashion designs is a prudent step to best protect these products from being duped by copycat brands. More to come.