NEW YORK — Payless ShoeSource and parent company Collective Brands Inc. announced Friday they have settled a trademark infringement claim with K-Swiss Inc.
Under the settlement agreement, neither party admits liability to the other, but Payless has agreed to pay K-Swiss $30 million for compensatory damages.
Payless anticipates that some of the settlement will be covered by insurance, but what percentage was not known at press time. The company said that it will record a charge of $30 million in the second quarter, not subtracting damages its insurance may cover.
Additionally, Payless has agreed to “refrain from making, advertising, promoting or selling footwear confusingly similar to that sold by K-Swiss.” Payless does, however, have until the end of the year to sell through the inventory of product that prompted K-Swiss to file its lawsuit.