Class Action Lawsuit Filed Against Coach Over Bogus Takedowns, Trademark Bullying

from the nicely-done dept

We've seen so many cases of trademark bullying, and it's so rare to see people fight back, that it's interesting to see it happening -- and even more surprising to see it done as a class action suit. Eric Goldman points us to the news that this class action lawsuit has been filed against luxury goods maker, Coach, for apparently issuing takedowns to eBay for perfectly legitimate second-hand sales, while also threatening those who put up those items. I'll let the lawsuit itself (the full filing is embedded below) explain the basics:

Without investigating the validity of its allegations, Coach wantonly accuses consumers of infringing its trademarks by selling counterfeit Coach products. Coach apparently monitors online retailers such as E-Bay, looking for ads from consumers selling second hand Coach products. In response to such ads, Coach delegates a New York law firm to launch a threatening letter to the consumer. These letters accuse the consumer of trademark infringement, threaten legal action, and demand the immediate payment of damages to Coach in "settlement" of Coach's threats. At the same time, Coach (or its New York law firm) informs the online retailer that infringing merchandise is being sold on its website. In many cases, this causes the online retailer to involuntarily remove the allegedly infringing ad, and to disable the consumer's online account. This destroys any chance the consumer had to sell the Coach product second hand, and otherwise damages the consumer.

In many cases (such as that of the lead plaintiff identified here), Coach's allegations of infringement are flatly false. It appears that Coach fails to conduct even a minimally reasonable investigation into its counterfeiting claims before threatening legal action. For example, the lead plaintiff identified in this Complaint is a former Coach employee, who owned, and tried to sell, genuine and legitimate Coach products It was entirely legal for her to do so. Coach's threats against her were false, reckless, and unwarranted.

We've definitely seen attempts to use trademark law to block the legitimate sale of secondhand goods. It's a bad trend that needs to be stopped, and hopefully lawsuits like this might do the trick. Unfortunately, in the past few years, we've seen some really underhanded tricks used by producers to effectively block secondhand sales and first sale rights through legal trickery. It's not clear if that kind of defense will be used here.

The lawsuit itself wants a declaratory judgment that selling legitimate Coach goods secondhand does not infringe... but also includes a defamation claim, pointing out that accusing someone of infringement when it's not true could be seen as libelous. That part seems like a stretch, but I'll be curious to see how the court rules.

Filed Under: auctions, trademark, trademark bullying
Companies: coach, ebay

Confusion Over Liability Extends To The Real World, Rather Than Just Online

from the sue-sue-sue-sue dept

Reader jjmsan alerts us to a story that shows that various luxury brands suing service providers rather than those actually responsible doesn't just happen online, but can happen offline as well. Apparently, luxury goods maker Coach is suing the city of Chicago, because some vendors were selling counterfeit goods at the Maxwell Street Market. I'm at a loss as to why suing the city makes any sense at all. In response to the original complaints, the city sent police officers to the market, and actually arrested those selling counterfeit goods (why this is a criminal, rather than a civil, matter is left as an exercise to the reader). Either way, rather than recognize that the city appeared to be more than willing to work with Coach, the company sent a legal threat letter demanding that the city proactively crackdown on counterfeits. When that failed, Coach sued the city. Hopefully the courts will recognize the ridiculousness of suing the city, rather than focusing on the vendors actually responsible.

Filed Under: chicago, counterfeit, liability
Companies: coach