The New Sheriff Wears Plaid: Burberry Wins Massive Trademark Judgment

Don't mess with check-sess.

The corporate battle against patent and trademark infringement, especially of the Chinese variety, is usually lonely, bitter and fruitless. The problem for European and US companies whose intellectual property gets hijacked is that counterfeiting employs tens, if not hundreds of thousands of Chinese, while generating mega- millions in revenues - and taxes. It is also, in certain quarters, considered honorable payback for centuries of western exploitation of China.

But Burberry had had enough. Especially when the perps flagrantly displayed their wares on the net, misappropriated the Burberry name and ignored initial court orders to cease and desist.

Burberry and other brands are being assisted, finally, by rising judicial awareness of IP value as the tangible economy continues to struggle and judges become conscious that among the surviving sources of national income are such intangible assets.

Burberry has been a particularly persistent defender of its trademark and brand, because of its popularity and universality. This judgment also comes in concert with US securities regulators cracking down on a wave of Chinese IPO frauds. This was driven by unscrupulous Chinese entrepreneurs and lax regulators taking advantage of the western penchant for buying into what they assume is a booming Asian marketplace. The two trends suggest that the Chinese themselves recognize that in order to participate in the global economy they are going to have to adhere to western rules. Ultimately this will work to their advantage - as they see it - both because they believe their exports have become competitive on factors above and beyond price, but also because Chinese companies now have their own IP to protect - especially from their own countrymen. JL

Alexandra Steigrad reports in WWD via Catwalk Queen:

Burberry has faced its counterfeiters and won. The British fashion label has scored a $100 million default judgement in a Manhattan Federal court against a group of Chinese counterfeiters which sold goods online that infringed its trademark.
The group sold at least 22 items of goods which carried the distinct Burberry trademark, such as its plaid check and equestrian knit design. The judgement comes after seven months of waiting for a response from the defendants which ran websites including yesburberryvision.com and buyburberry.com. According to the judge, these defendants not only failed to answer to the complaint they also failed to show up in court.

The result has lead to Burberry being awarded $100 million in addition to any further funds held by the service provider, PayPal. The judge also issued a permanent injunction and ordered the infringing domain names be transferred to Burberry. This will allow the company to take control of its brand image and prevent service providers, web designers, search engines and any other party to benefit from the defendants and their businesses. Such a ruling means Burberry are now in a position to shut down any other offending websites which are currently making a profit off selling counterfeit goods that infringe on their trademark.

The outcome is similar to that of a decision made last month which saw Hermès International also awarded $100 million against 34 counterfeit websites. In both instances, the court identified Internet search engines, ad-word providers, and social media sites as being also responsible in the selling of counterfeit products.