Court Bars Aerie From Selling Overslept Sleepwear Ahead of Holidays

A federal judge on Monday barred American Eagle Outfitters from selling its Overslept by Aerie sleepwear line, granting a preliminary injunction to JS China, a New York apparel manufacturer that has sold sleepwear under the federally registered Overslept trademark since 2019. U.S. District Judge Loretta A. Preska entered the order in Manhattan federal court, weeks before the peak holiday selling season.

JS China filed the trademark infringement suit in mid-September against the retailer's Aerie division. The company said it has moved nearly 1.5 million units under the Overslept mark, generating more than $3.8 million in sales. It wholesales women's apparel under several brands — Breakfast in Bed, End of Story, Grumpy & Gorgeous and Not a Morning Person — to retailers including Charlotte Russe, Burlington and Urban Planet.

Aerie pulled the label from its website shortly after the suit was filed but kept the line in stores. That channel split now ends. The order requires Aerie to stop selling Overslept merchandise immediately, though physical removal raises operational costs: many of the pajamas carry heat-sealed labels, which would have to be covered so consumers cannot see them, according to Marc Greenwald, a partner at Quinn Emanuel representing JS China. Relabeling, rather than pulling goods, remains an option.

What did the court find?

Judge Preska found that Aerie adopted the mark in bad faith. "We know that the defendant admitted that it knew in the fall of 2025 about the plaintiff's Overslept mark, which is more than eight months before it launched its mark," she said, according to the hearing transcript. She noted that a trademark search Aerie ran in October 2025 turned up the plaintiff's registration, and that the record showed Aerie saw JS China's sleepwear online in September 2025.

The judge also found "irreparable harm" to JS China "was entirely foreseeable in light of the defendant's apparent intention to flood the market in the upcoming holiday season." The trademark search showed JS China was the only company using Overslept as a sleepwear brand in the country, she said, and the record contained no explanation for why Aerie proceeded with "exactly congruent items sold in the same line of commerce to the same customers."

Greenwald said: "JS China is gratified that the court recognized the incontestable trademark for the Overslept brand and stopped Aerie's bad faith use of the trademark. They were aware of it. In October, they ran a trademark search and found JS China's registered trademark yet they decided nevertheless to proceed with their product branding and launch."

What happens next?

The judge directed the parties to work together on next steps. If no settlement is reached, the case could go to trial, where Preska could order a permanent injunction and damages. American Eagle can appeal. An American Eagle representative said: "As a matter of policy, we do not comment on pending litigation. However, given that the judge has directed the parties to work together on next steps we feel reporting on this story at this time is premature."

The timing stings. Two weeks ago, at the Wharton Baker Retailing Center CEO Summit in Manhattan, Jennifer Foyle, president and executive creative director of Aerie and American Eagle, promoted the line. "We haven't launched [Overslept by Aerie] necessarily as a brand yet, but we're certainly allocating more square footage to it because it's doing that well right now," she told the audience. She said sleepwear started "taking hold" at Aerie last year, prompting the launch.

Greenwald drew the line at branding, not design: "It's not a copyright case involving the design. It's the branding." For sourcing and merchandising teams, the case is a reminder that trademark clearance, relabeling labor and holiday inventory planning now sit on the same critical path.