Before 2017

Coach Files Trademark Counterfeiting Complaint in Southern District of GA

On October 26, 2012, New York-based Coach, Inc. and Coach Services, Inc. (collectively “Coach”) filed a complaint in the Waycross Division of the Southern District, alleging that defendant Teresa J. Moore d/b/a Douglas Gold Buyers & Jewelry Store sold counterfeit merchandise bearing “Coach Trademarks,” and that Ms. Moore infringed those marks.
Coach’s complaint alleges that in November 2011, its private investigator observed that Ms. Moore’s store was displaying handbags, wallets, and shoes bearing the “Coach Trademarks,” and that as of January 16, 2012, Ms. Moore was offering, on a Craigslist site, a gold bracelet bearing the marks shown below:
Coach Trademarks in U.S. Trademark Reg. Nos. 3,696,470 (left) and 3,413,536  (right)

Coach further alleges that these uses of its marks were without Coach’s permission.  Its complaint requests, among other things, injunctive relief, “statutory damages of $2,000,000 per counterfeit mark per type of Infringing Product”[1] or, alternatively, an award of actual damages and profits, with such an award to be trebled.
As stated by Eleventh Circuit, “The Lanham Act prohibits, among other things, the use in commerce of a counterfeit trademark in a manner likely to cause confusion; and the Act further provides that anyone using a counterfeit trademark in such manner shall be liable in a civil action to the registrant of the trademark.”[2]  “If the infringement is intentional, . . . § 1117(b) governs: unless the court finds extenuating circumstances, treble damages and attorneys’ fees are mandated.”[3]
Proof of intent necessary to recover treble damages and attorneys’ fees under § 1117(b) may be established by proof that the defendant was “willfully blind.”[4]  “Under the doctrine of willful blindness, ‘knowledge can be imputed to a party who knows of a high probability of illegal conduct and purposefully contrives to avoid learning of it.’”[5]  Whether the defendant was “willfully blind” is a question of fact, considering the totality of the circumstances.[6]  Interestingly, the Eleventh Circuit recently refused to apply the concept of willful blindness to the defense of trademark fraud (see prior post).
In addition to civil penalties, criminal liability may be imposed for intentional trademark counterfeiting.  “Section 2320 of the Trademark Counterfeiting Act was enacted in order to increase the sanctions for the counterfeiting of certain registered trademarks above the purely civil remedies available under the [Lanham Act].”[7]
The case is Coach, Inc. and Coach Services, Inc. v. Teresa J. Moore d/b/a Douglas Gold Buyers and Jewelry Store, No. CV512-125, filed 10/26/12 in the U.S. District Court for the Southern District of Georgia, Waycross Division, assigned to Chief Judge Lisa G. Wood, and referred to Magistrate Judge James E. Graham.   

[1] Under the Lanham Act, a plaintiff establishing that the defendant used a counterfeit trademark may, anytime before final judgment in the trial court, elect to recover statutory damages in lieu of an award of profits and actual damages.  “If the court finds that the use of the counterfeit mark was willful,” that plaintiff may recover “not more than $2,000,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just.”  15 U.S.C. § 1117(c).
[2] Chanel, Inc. v. Italian Activewear of Fla., Inc., 931 F.2d 1472, 1475 (11th Cir. 1991).
[3] Id. at 1476 (italics in original) (discussing 15 U.S.C. § 1117(b)).
[4] Id.
[5] Nike, Inc. v. Variety Wholesalers, Inc., 274 F.Supp.2d 1352, 1369 (S.D. Ga. 2003) (quoting Williams v. Obstfeld, 314 F.3d 1270, 1271 (11th Cir. 2002)).
[6] See Chanel, 931 F.2d at 1476.
[7] United States v. Torkington, 812 F.2d 1347, 1350 (11th Cir. 1987) (discussing 18 U.S.C. § 2320).

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