Clarks v Trek: when coexistence agreements hit the cobbles

Trade mark coexistence agreements are designed to keep businesses in separate lanes. Clarks v Trek shows what happens when the market shifts and those boundaries no longer hold.

The High Court’s recent decision is not just about shoes. It is about what happens when product categories evolve faster than the contract designed to separate them.

The result here is that both parties were in breach of the same agreement, but for different reasons and with different consequences.

The deal that worked… until it didn’t

Back in 2001, Clarks (shoes) and Trek (bicycles and cycling apparel) agreed a classic coexistence arrangement:

Clarks could use TREK for footwear

Trek could use TREK for cycle-related clothing, but not footwear

Neither would stray into the other’s lane; in particular, Trek would not use TREK on footwear

The commercial logic was simple: different channels, different products, no confusion. And for about 15 years, it worked. Then the market moved.

The dispute ultimately turned on the interpretation of the agreement, in particular the phrase that Clarks’ TREK footwear was not to be “adapted for… participating in sports or fitness”.

At the time of the agreement, this carve-out made sense. Clarks’ TREK shoes were rugged outdoor footwear, not sports shoes. Trek sold cycling kit, not footwear.

Fast forward to the 2020s and the boundary between ‘outdoor’, ‘casual’, and ‘sports/fitness’ footwear has largely collapsed. Now Clarks is selling ‘athleisure’ and trainer-style TREK shoes, and Trek wants to sell TREK-branded cycling shoes.

The court treated that shift as central, not incidental.

The key finding was that the agreement created a ‘white space’ that neither party was meant to enter, but both eventually did.

What did the agreement actually prohibit?

Trek’s primary argument was that cycling shoes were not really footwear in the sense intended by the agreement. Rather, they were closer to specialist cycling equipment.

That went nowhere.

The court held that ‘footwear’ means what it says, i.e. shoes and boots. The agreement did not distinguish between different types of shoes. Cycling shoes (even highly specialised ones) still fall within that category.

The commercial point is obvious in hindsight. If you want to carve out technical or specialist subcategories, you have to say so explicitly. Trek didn’t and it lost on that point.

Against that backdrop, the court first considered Trek’s position. Trek’s use of TREK on cycling shoes fell squarely within the prohibited area. The fact that those shoes were specialist or technical did not take them outside ‘footwear’.

The same reasoning then turned back on Clarks.

Clarks’ position was more subtle. It argued that its newer TREK products were still essentially casual or walking shoes and not adapted for sports or fitness.

However, the problem was its own documents.

The court relied heavily on internal product categorisation (‘Sport’, ‘Sport Active’), design briefs referring to running, training and fitness use, product naming (including ’Run’), and trainer-style construction and materials.

The court held that some of Clarks’ newer TREK shoes had crossed the line into the prohibited sports/fitness category.

“We had a deal”

Trek also argued that a 2018 meeting resulted in Clarks consenting to Trek using TREK on footwear.

The evidence included a conversation between commercial teams and a symbolic gift of a shoe last.

The court rejected this outright on the basis that there was no clear consent and no written amendment. At most, there was a statement that it “should not be a problem”. That was not enough to vary a formal coexistence agreement.

In short, coexistence agreements are only as flexible as their variation clause and as disciplined as the parties using them.

A Lidl problem

One of the more interesting aspects of the case concerns Lidl’s sale of ‘Lidl-Trek’ footwear (used by Lidl to promote the Lidl-Trek cycling team during the Tour de France).

Trek tried to argue that it did not itself sell the products and that Lidl acted independently.

The court disagreed. Contractually, because the agreement bound affiliates and licensees, Trek was responsible for Lidl’s sales and therefore in breach of the agreement.

But, crucially, Trek was not liable for UK trade mark infringement on those particular facts.

No escape via trade mark law

Trek tried several routes to narrow Clarks’ position, including partial revocation for non-use, consent, statutory acquiescence and honest concurrent use. Those arguments failed in relation to Trek’s own TREK-branded cycling shoes and insoles.

On infringement, the court found use of an identical sign, TREK, for identical goods in the case of cycling shoes and similar goods in the case of insoles, without consent and with a likelihood of confusion. Clarks therefore succeeded under sections 10(1) and 10(2), although not under section 10(3).

The position was different for the Lidl-Trek team footwear: Trek was contractually liable under the coexistence agreement, but Clarks’ trade mark infringement claim failed in that context.

The coexistence agreement didn’t save Trek; it ultimately framed the breach.

What this means in practice

Clarks v Trek is not really about who won (both sides lost ground). It is about how coexistence agreements fail over time.

Three practical points stand out:

• Draft for evolution, not just the status quo

If the agreement assumes unchanging product categories, it will age badly. Build in mechanisms for expansion, review clauses and defined subcategories (especially for technical goods).

• Control your internal language

Product names, design briefs and marketing language are not internal housekeeping, they are litigation evidence that could be used against you.

• Regulate the ecosystem

If partners can use the mark, they must be contractually controlled. Otherwise, you inherit their breaches.

A broader trend

This decision sits alongside a line of recent cases showing courts taking coexistence and settlement arrangements seriously, and enforcing them strictly, even where markets evolve in unexpected ways. For example, it fits with the Court of Appeal’s recent approach in Merck v Merck, where a long-standing coexistence arrangement was tested by modern online use.

Coexistence agreements are not ‘set and forget’ instruments, they are living commercial boundaries that require active management and monitoring.

Humphreys Law are specialists in trade mark registration, disputes and enforcement.  If you have any questions or issues concerning the above, contact a member of our team.

All the thoughts and commentary that HLaw publishes on this website, including those set out above, are subject to the terms and conditions of use of this website.  None of the above constitutes legal advice and is not to be relied upon.  Much of the above will no doubt fall out of date and conflict with future law and practice one day.  None of the above should be relied upon.  Always seek your own independent professional advice.

Humphreys Law