Fashionista would be surprised if the settlement allows for continued co-existence of the brands. As the Denver Post reports, Jimmy Winkelmann was seen dishing out The South Butt clothing whilst on his college Spring Break. Given the continued operation of the website, it is more probable that the settlement agreement allows some sort of “wind down phase” in which The South Butt is entitled to get rid of its remaining stock within an agreed period of time – but is not allowed to produce any further stock or continue to use the brand name which caused such offence to The North Face in the first place. Settlements of this sort are not uncommon and are often a speedy, cost effective way of resolving conflicts – without the risk, cost and uncertainty associated with going to court.
But who is the real winner? Even if the terms of settlement are such that Jimmy Winkelmann must (eventually) stop using The South Butt trade mark, reports that he made $100,000 in one month because of publicity regarding the lawsuit suggest that The North Face may, in fact, be the butt of the joke here (for the second time).
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Ultimately whether the decision to sue was wise or not will likely come down to whether South Face also received increased sales as a result of the publicity, or if they instead painted themselves with a bully persona and suffered diminished sales.