September 30, 2022
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K-Swiss gets $30M in court settlement

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Collective Brands Inc., owner of the Payless ShoeSource and Stride Right chains, agreed to pay $30 million to Westlake Village-based K-Swiss Inc. to settle claims it copied the company’s shoes by using a five-stripe design.

 Collective agreed not to sell “confusingly similar’’ footwear, the companies said June 27 in U.S. regulatory filings. Payless will be allowed to sell its inventory of disputed shoes through the end of the year.

A trial of the 4-year-old trademark-infringement case was scheduled to begin July 8 in federal court in Los Angeles. Earlier this month, U.S. District Judge George Schiavelli denied Collective’s request to delay the trial.

Topeka-based Collective Brands will record a $30 million charge in the quarter ending Aug. 2, according to a filing. The company said “some portion’’ of the settlement may be paid using insurance coverage. Its shares rose 31 cents to $12.01 on June 27 in New York Stock Exchange composite trading.

K-Swiss sued Collective Brands in 2004, when it was still known as Payless. It didn’t admit wrongdoing under the deal. Settling the case will allow Payless to “focus even more so on our business,” spokesman James Grant said.