Navajo Nation and Urban Outfitters
This case is based on a real situation between the Navajo Nation and clothes manufacturer Urban Outfitters. The lawsuit that resulted from the situation was settled out of court in a confidential settlement. Cases may settle out of court for a number of reasons – the parties do not want the expense of a lawsuit, the parties are uncertain of their likelihood of success, the parties want to avoid any potential negative publicity associated with the situation, etc. Because this case was settled out of court with a confidential settlement, we truly do not know who might have won the lawsuit. There is no real indication of admission of wrongdoing. As such, this case is a good case for discussing the ethical aspects of the decision.
Urban Outfitters
Dick Hayne and Scott Belair founded Urban Outfitters as a second-hand goods store named Free People in 1970. As the company grew and expanded, it added new dimensions to its portfolio. In 1992, Anthropologie was created to target 30 to 45-year-old women. The company went public (ticker URBN) in 1993. In 1998, Urban Outfitters opened its first store in Europe in addition to beginning its direct-to-consumer business and web page. In 2002, the Free People label again emerged in Paramus, New Jersey. Six years later, Urban Outfitters acquired a popular garden center in Glen Mills, PA, and developed Terrain at Styers, a retail store, event space, and café. In 2011, BHDLN was launched adding bridal gowns, accessories, party dresses, and gifts to the portfolio. Most recently, in 2016, URBN acquired a group of restaurants.
As of 2017, Urban Outfitters is one part of Urban Outfitters, Inc., which also includes the Anthropologie, Free People, Terrain, Leifsdottir, and BHLDN brands. Headquartered in Philadelphia, Pennsylvania, Urban Outfitters, Inc. had sales of over $3.5 billion in 2017 and a net income of $218.12 million. There are over 300 stores affiliated with the URBN brands, all focused on one mission: “URBAN OUTFITTERS is a lifestyle retailer dedicated to inspiring customers through a unique combination of product, creativity, and cultural understanding.”
The Navajo Nation
The Navajo Nation has been a sovereign nation since 1868 and has been a tribe known as Navajo since at least 1849. It is the largest indigenous tribe in the United States and currently has over 300,000 registered members primarily located in northeastern Arizona, northwestern New Mexico, and southeastern Utah. The capital of the Navajo Nation is in Window Rock, Arizona, approximately 190 miles from Flagstaff, Arizona, and 160 miles from Albuquerque, New Mexico. Tribal government consists of 110 Chapters – geographically determined subdivisions – that handle local economic issues, land lease issues, and planning and development issues. Chapters are subordinate to the Navajo Nation Council which can overturn Chapter decisions. The Council is made up of 88 delegates elected to serve four-year terms. The Nation also has a judicial branch headed by a Chief Justice and an executive branch headed by the Tribal President.
The reservation is approximately 27,000 square miles (17.5 million acres) and consists of high desert lands. Just over 180,000 members of the Nation live on the reservation where the median age is 24 and the median family income is $22,392. The unemployment rate on the reservation is approximately 42%.[1] Fifty-six percent of Navajos over the age of 25 have a high school degree and only 7% have a college degree. Nearly 30% of the occupied housing units on the reservation lack complete kitchens or plumbing. The tribe is known for its silver and turquoise jewelry and its hand-woven rugs.
To protect its image, culture, and history, the Navajo Nation government created the Diné Development Corporation or DDC. The DDC owns the NAVAJO trademark and is the sole entity authorized to issue licenses to others to use the name Navajo. The DDC has over 80 different trademarks for a variety of products, including jewelry, backpacks, clothing, tableware, and many others.
The Situation and the Question
Indigenous patterns are highly popular. Several employees of Urban Outfitters would like to produce and market a line of products using traditional Navajo patterns or similar patterns using the Navajo name. Participants may be asked to serve as a decision maker for UO or an advisor to UO to evaluate whether to use those patterns and the name for a new product line.
The Epilogue
In early 2009, Urban Outfitters began using the terms “Navajo” and “Navaho” on products that included clothing, jewelry, undergarments, and flasks. In addition to the term, they used several tribal patterns or similar patterns of geometric prints and designs.[2] The Navajo Nation sued for violation of trademark and other claims. The case was settled out of court.