This week a Seoul Central District Court awarded damages to Chanel for defamation inflicted on Chanel by a room salon that was branded as Chanel Business Club. The court noted that: "The defendant, by using Chanel’s image for his business which is commonly associated with a negative image, inflicted damage to the brand value of Chanel." The defendant never responded to the suit.
A room salon is a type of bar where girls entertain men in private rooms by engaging in friendly banter. Some of the clubs allow girls to leave the bar with the bar patrons.
This trend of allowing damage for damage to the business reputation is welcome, however, the damages awarded are, often, so trivial, that few brands are willing to file suit. Chanel seems to want to, merely, warn others from using its brand in a nefarious manner.
The court awarded damages to Chanel in the amount of KRW 10mil (USD 8,900).
Sean Hayes, IPG's Co-Chair of the Korea Practice Team, may be contacted at: SeanHayes@ipglegal.com