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JA Apparel v. Abboud

By Christopher P. Bussert

Cases involving family name disputes have historically presented challenges for courts, as they frequently require balancing competing interests of businesses and individuals. A particularly interesting permutation of such disputes involves well-known individuals who convey certain rights in their family name in a particular field to a third party and then later seek to re-enter the same field. A trio of recent decisions on this subject features the famous clothing designer, Joseph Abboud. JA Apparel Corp. v. Abboud, 591 F. Supp.2d 306 (S.D.N.Y. 2008) (“Abboud I“); JA Apparel Corp. v. Abboud, 568 F.3d 390 (2d Cir. 2009); JA Apparel v. Abboud, 2010 WL 103399 (S.D.N.Y., Jan. 12, 2010) (“Abboud II“).

At the heart of the dispute was the interpretation of a Purchase and Sale Agreement (“Agreement”) executed on June 16, 2000. In exchange for a substantial payment, Abboud agreed to “sell, convey, transfer, assign and deliver” to JA Apparel “all of [his] right, title and interest in and to ' [t]he names, trademarks, trade names, service marks, logos, insignias and designation identified on Schedule 1.1(a)(A),” which included Joseph Abboud, “and all trademark registrations and applications therefor, and goodwill related thereto.” Abboud I, 591 F. Supp.2d at 306. On July 13, 2000, the same parties entered into a Side Letter pursuant to which Abboud agreed to serve as “Chairman Emeritus” of JA Apparel and provide consulting services relating to the products sold under the foregoing marks. The Side Letter also included a two-year non-competition provision.

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