Traditionally, fashion designers name their businesses after themselves. So, What’s in a name? A lot more than you may think! According to the complaint, JLM Couture, a wedding dress manufacture– which generated around $220 million in retail sales between 2017 and 2020 – claims that it enlisted wedding dress designer Hayley Paige Gutman, to come on board as a designer for its bridal collections in July 2011, when she was only 25 years old. As a result, the designer entered into an employment agreement with JLM, which is still currently in effect.
JLM Couture states that in the Employee Agreement signed by Gutman, she agreed to let the company obtain trademark ownership rights to "Hayley Paige" and all derivatives (“ 'Hayley', 'Paige', 'Hayley Paige Gutman', 'Hayley Gutman', 'Hayley Paige', or any derivative thereof [...] in connection with the design, manufacture, marketing and/or sale of bridal clothing, bridal accessories, and related bridal and wedding items."). The company later successfully registered nine trademarks containing the designer's name (see below). The contract also extended to the social media account @misshayleypaige and other accounts on platforms including Facebook, Pinterest, Twitter, and YouTube. Because Gutman, signed away trademark rights to her name. That means she can not—legally use her own name to design, manufacture, market or sell bridal apparel, bridal accessories, evening wear and related goods and services.
In June 2020, "While negotiating a new employment contract, the two sides disagreed over how much freedom Hayley would have to promote her non-related side businesses on the company site. After Hayley stopped posting JLM content and deprived the company of access to the account, JML brought the matter before the court." Where Judge Laura Taylor Swain of the U.S. District Court for the Southern District of New York issued a temporary restraining order in JLM’s favor.
Gutman told her nearly 100,000 followers of her @allthatglittersonthegram account in a video published on Monday, that she did not have a lawyer when she signed the original employment agreement and says that if there is “only one thing” that viewers take away from her video it is that “if anyone tells you that you don’t need a lawyer to take a look at an agreement or contract, please get a lawyer.”
In the words of Makeup Mogul, Bobbi Brown, who similarly sold her name/brand to Estee Lauder in 1995, “In this day and age, with so much media, people are brands, not just the products that people put on their body.” This is especially important to consider when selecting the name of your business. As for what the court will ultimately decide, in regards to Gutman’s use of her name, it seems very unlikely they will find in her favor. The right to contract is one of those fundamental rights in our society that the court upholds at all costs and will not take away unless there is evidence of a valid defense, which does not appear is the case since Guzman acknowledges she willingly signed the agreement.
UPDATE: Court Reviews “Novel” Issue of Social Media Account Ownership in Hayley Paige Lawsuit
After the Preliminary Injunction was issued, the parties’ relationship deteriorated further and JLM requested that the Court hold Hayley in civil contempt of the Preliminary Injunction Order. JLM’s request was based on Hayley's activities on her Instagram @allthatglittersonthegram account, including her announcements that she planned to reveal her “new brand name very soon” and reenter the bridal industry this month ( August of 2022). In addition, Haley changing the access credentials for the Instagram Account and the Pinterest Account, and refused to share the new log-in information with JLM. The Court found that JLM provided clear and convincing evidence that Ms. Gutman failed to comply with the Preliminary Injunction Order, which incorporates her contractual obligation not to compete with JLM.
Hayley argued that JLM cannot establish ownership of her Accounts because “there is no provision in the Employment Agreement . . . that provide for JLM to receive ownership over social media accounts created by her. This however, was contradicted by the language of the Contract. As the Court previously found, JLM had demonstrated that the content on the Instagram Account "constitutes a "work for hire" pursuant to Section 10(b) and 11 of the Contract, because Hayley developed the Account “in connection with her employment” under a “handle that incorporated the name to which she had already granted them the exclusive right and license to use”.
The issue of ownership of a social media account is novel, and few courts have examined the question. However, this Court found that JLM is clearly likely to succeed in demonstrating that it owns the Instagram and Pinterest Accounts themselves – and not just their featured content – pursuant to Section 11 of the Contract. We will be watching to see how this trial unfolds and what additional information will be uncovered during discovery.
The case is JLM Couture Inc. v. Gutman, case number 1:20-cv-10575, in the U.S. District Court for the Southern District of New York.
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