The Rise (and Fall?) of Vintage Consignment Stores

Delaney Helmke
7 days ago
2 min read

A woman takes a mirror selfie in a vintage punk store. Text reflects the title and author of the article.

The rise of the second-hand fashion market has introduced a number of novel legal questions, especially in the realm of intellectual property (IP). For law students interested in fashion law or IP litigation, the intersection of resale, consignment, and trademark protection offers a fascinating ground for legal analysis and potential career specialization.

While IP laws generally allow Canadians to resell their goods without infringing the rights of others, resellers need to be very diligent with their authentication practices. Otherwise, consignment and vintage stores, especially those dealing in luxury or designer goods, can very easily (and often, inadvertently) violate IP protections.

Trademark Infringement and the Principle of Exhaustion

Trademark law is particularly relevant for consignment shops that resell high-end branded items such as handbags, shoes, and apparel. If counterfeit goods are sold, either intentionally or unintentionally, the retailer can be exposed to legal liability.

Resellers may be awarded some protection thanks to the principle of exhaustion. According to this principle, once an IP-protected product is sold by the rightsholder, their control over that product is “exhausted”, allowing the buyer to resell it without infringing IP rights. However, the principle only applies if the item is genuine and unaltered. That means that once a piece is “reworked” (e.g., a Louis Vuitton handbag turned into a phone case), it may no longer be protected under the principle.

Dupes, Knockoffs, and Consumer Confusion

Another grey area is the sale of so-called “dupes.” Dupes are products from lesser-known brands that imitate the look, feel, or functionality of designer products, usually for a fraction of the price. While not direct counterfeits, dupes can still infringe on design, copyright, or trade dress, particularly if they are marketed in a way that implies affiliation with, or endorsement of, an IP-protected product.

For example, a vintage store selling items that mimic the aesthetics of other brands could still face legal repercussions if the resemblance is close enough to cause consumer confusion. These cases often turn on the “likelihood of confusion test”, which evaluates factors such as the strength of the competing mark, the similarity of the marks in appearance or sound, and actual consumer perception.

Implications for Future Practitioners

There is no doubt fashion law is an interesting and up-and-coming area of practice. That said, law students interested in this area should consider how the resale industry is driving new enforcement strategies among fashion brands, and adapt their approach as new trends emerge – in fashion and in law.