But the most unsettling developments were on the department-store front. After the launch of Glow by J.Lo, Nordstrom halted its rollout of Williamson's products to other stores. In addition, two department-store chains that had been interested in getting her line for the Christmas season suddenly decided to think about it. "We hope you'll understand," the buyers said.
On the other side, Lopez and Coty knew that, if they lost the injunction battle, Glow by J.Lo would probably have to be pulled off the market at the height of the holiday season and at great expense. Coty had already invested more than $29.5 million in the manufacture, advertising, and promotion of Glow by J.Lo in the United States. More than $5.2 million had been spent on advertising alone. Much of that would be wasted if the motion were granted and production shut down while the packaging was changed -- which could take four to six months. Coty estimated it would lose $13 million in U.S. sales during that time.
Catherine Walsh took the huge gamble of starting work on the product while still negotiating for its rights. She knew its chances of paying off would depend largely on whether she could work with Jennifer Lopez.
Such an outcome was by no means inconceivable. In 1987, a strikingly similar case had gone to court in New York. The dispute arose when the Elizabeth Taylor Cosmetics Company came out with a fragrance called Elizabeth Taylor's Passion. At the time, renowned Parisian perfumer Annick Goutal was selling her own fragrance called Passion. Goutal sued and won an injunction. But could Williamson pull off the same trick? To do so, she would have to convince the judge of three things: first, that she had a protectable trademark; second, that consumers might confuse the brands; and third, that Glow Industries would suffer irreparable harm as a result.
Glow should have had an easy time proving protectability -- all you need is a registered trademark. If you have one, you are presumed to have the exclusive right to use it commercially. This path was not open to Williamson, however, because the Patent and Trademark Office had not yet finished dealing with her trademark application. Although the company had submitted it way back in April 1999, the registration process had dragged on far longer than usual. At the end of 1999, the Patent Office's examining attorney had raised questions about possible conflicts with three existing trademarks. Aaronson had provided answers shortly thereafter, but then nothing happened for two and a half years. (He says the process took so long because the Patent Office lost the Glow file at one point and then kept switching examiners.) Not until November 5, 2002 -- two days before the hearing -- did the office clear the application to go to the final phase of the process: publishing the trademark to see if anybody wished to challenge it. As a result, the Glow trademark was still not registered.
The J.Lo team moved quickly to exploit this vulnerability. Just two days after Glow submitted its motion for a preliminary injunction, Jennifer Lopez paid roughly $40,000 to buy one of the trademarks that the Patent Office's attorney had raised questions about. The mark, Glow Kit, had been registered by a dermatologist in the Chicago suburbs who put together packages containing sunscreen, cleansing lotions, alpha-hydroxy acid products, and the like. His two dermatology centers then sold these Glow Kits to treat minor skin disorders. Under the terms of his deal with Lopez, the dermatologist would be allowed to license the trademark and continue using it as he had before, but Lopez would own the Glow Kit mark and all the rights that came with it. The deal meant Lopez could turn around and sue Glow for -- guess what -- patent infringement.
"Right after Christmas, I had time to think, and I saw how difficult it would be to keep the name Glow under any circumstances. They could stop using it today, and Glow would still be linked with J.Lo."
And that's precisely what she did on October 8. Responding to the motion for a preliminary injunction, Lopez and Coty made a counterclaim, in effect accusing Williamson of stealing the Glow trademark from them! Williamson saw the move as a blatant attempt to intimidate her into dropping her suit, which it may have been, but it also had a strategic purpose. Lopez's attorneys could now argue that the Glow Kit mark was the senior one and that therefore Glow's mark was not protected.
That was, however, just one piece of evidence the judge would use in deciding whether to grant the motion for a preliminary injunction. The other evidence was contained in the filings both sides had submitted prior to the hearing. As the plaintiff, Glow Industries got the opening shot and could include as much evidence as it liked in its motion papers. The defendants -- Jennifer Lopez and Coty -- would offer their evidence when they filed their response. Glow could then respond to the response, thus getting two bites of the apple while the defense would get only one. The judge would take all the information, weigh it, and issue a tentative order. At the hearing, the two sides would argue their respective cases. The judge would think it over and issue a final order.
That's how it was supposed to work, at any rate. Within those guidelines, there was room for maneuvering, and Arthur Aaronson used a tactic that he no doubt believed would give his client an advantage. In making his motion for a preliminary injunction, he chose to include little information about Glow and little evidence to support Glow's allegations. In effect, he forced the other side to lay out its case first. It's an unusual tactic that can work, but it's fraught with risk. Among other things, it can antagonize the judge.
