Fashion Brands: Leveraging Blockchain Technology for IP Protection

Key Points

1. IP Ownership: Blockchain is a useful tool for securing intellectual property in fashion, offering a reliable record of ownership and authenticity.
2. IP disputes: Countries including France, Italy and China recognise blockchain timestamping as valid legal evidence, enhancing its credibility in IP.
3. Anti-Counterfeiting: Blockchain aids in fighting counterfeits, as demonstrated by EUIPO projects with luxury brands for product authentication.
4. Challenges: Despite its benefits, blockchain faces issues like limited legal recognition and privacy concerns, which must be addressed in IP strategies.

Before generative AI took the world by storm, blockchain was the next big thing for tech-oriented intellectual property lawyers. Today, although it receives less attention and media coverage than its brilliant and boisterous younger sibling, blockchain remains a key technological evolution for intellectual property law and has had a significant impact on numerous IP focused industries. As demonstrated by a recent decision of the Tribunal Judiciaire de Marseille (Marseille’s High Court), this is particularly true for the fashion industry¹.

Understanding Blockchain

Blockchain is a decentralised digital ledger that securely records transactions across multiple computers. It consists of digital blocks, each with a list of transactions, a timestamp, and a unique code linking it to the previous block. This structure ensures data integrity by preventing alterations without network consensus, making it highly trustworthy

Case Study: AZ Factory vs. Valeria Moda

In the Marseille decision, judges relied on blockchain technology to resolve a copyright dispute between AZ Factory and Valeria Moda. AZ Factory, founded by Alber Elbaz in 2019, claimed unauthorised reproduction of its designs "Love from Alber" and "Hearts from Alber." Blockchain was key to proving AZ Factory's ownership, as it provided evidence of digital fingerprints anchored in the blockchain, establishing both ownership and the anteriority of its creations over Valeria Moda's products

Leveraging Blockchain in Fashion

This decision illustrates how fashion companies can use blockchain to safeguard their IP rights. The article explores various applications of blockchain in the fashion industry, along with the associated benefits and risks.

Opportunities

• IP ownership and book-keeping

Courts and legislators increasingly recognise blockchain's reliability, enabling creators and IP owners to establish a verifiable, tamper-proof timeline of their work's existence and ownership. The Marseille decision demonstrates blockchain's key benefit of providing a secure, immutable record of ownership. In 2018, China's Supreme People's Court similarly confirmed the validity of blockchain-authenticated evidence², and in 2019, Italy enacted legislation to affirm the legal effects of blockchain timestamping, establishing a presumption of validity for blockchain-authenticated evidence³.

This is particularly beneficial in the fashion industry, where frequent ownership challenges arise due to numerous new designs that may not be eligible for registrable rights. Regular blockchain registration during the creative process helps fashion companies prove ownership and identify contributors.

• Authentication

As explained above, the storing of information on blockchain is spread across multiple servers, rather than a single server, meaning there is no single institution, company or individual who hosts and controls the information. This makes blockchain extremely difficult to hack. Once a block is validated, it can only be changed if changes are made across the entirety of the network – an extremely onerous task for potential hackers, who would have to attack all copies of information shared across multiple servers simultaneously.

Blockchain's secure architecture allows fashion brands to ensure product traceability and quality assurance.

1. Product Authenticity: Blockchain enables consumers to verify product origins and creators, enhancing brand protection and providing trademark and ownership details. It helps identify counterfeits by using scannable tags or chips, aiding customs in distinguishing genuine goods from fakes, which is crucial for luxury brands. The EUIPO's pilot projects with ENDSTATE, PRADA Group, and others⁴ demonstrated blockchain's role in product authentication, leading to the "AUTHENTIC view" infrastructure to combat counterfeiting⁵.

2. Industry Standards Compliance: Blockchain could revolutionise certification marks, like the Woolmark and Fairtrade, by enabling instant identification of fake certifications. This would enhance consumer trust and increase the perceived exclusivity and quality of products.

• Enforcement

Blockchain technology can significantly enhance brand owners' enforcement efforts by easily verifying product inception, origin, and authenticity.

In China, copyright owners have used blockchain time-stamped evidence in infringement claims, leading to administrative penalties like confiscation of illegal earnings and fines. This straightforward application of blockchain signals to the public and potential infringers that online infringements can be easily captured and used as evidence. Similarly, the Marseille Court in France has validated blockchain-embedded works as proof of ownership and anteriority.

Challenges

While blockchain offers many benefits for the fashion industry, it also presents challenges. It is useful for IP protection, like proving ownership and tracking digital assets, but not suitable for all IP types or lifecycle stages. In first-to-file trade mark systems, traditional registration remains crucial. Blockchain can prove copyright ownership prima facie, but claims still require substantive proof.

Legal recognition of blockchain records is growing, but lack of universal standardisation complicates IP enforcement across jurisdictions. Blockchain also struggles with preserving evidence of physical infringements, where traditional methods like notarised purchases are necessary. Additionally, blockchain's transparency can raise privacy concerns, as sensitive IP information may be accessible to all participants.

Overall, while blockchain enhances IP protection with security and transparency, its limitations must be considered in protection and enforcement strategies.

¹ Tribunal judiciaire de Marseille, 1st civil chamber, 20 March 2025, docket n° 23/00046
² “Regulations issued by the Supreme People's Court on Several Issues Concerning the Trial of Cases by Internet Courts" (https://www.court.gov.cn/zixun/xiangqing/116981.html)
³ Law 12/19, Article 8-ter part 3: The storage of an electronic document using distributed ledger technologies has the legal effects of electronic time stamping as referred to in Article 41 of Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014.
⁴ See here for further reference: https://auraconsortium.com/
⁵ Presentation of EUIPO’s AUTHENTIC view: https://www.euipo.europa.eu/en/observatory/enforcement/authenticview