Bank of China Complies With Subpoena In Gucci Counterfeit Case

Gucci Runway AW09

> U.S. judge found bank in contempt, fined it $50,000 a day
> Gucci sought bank records of counterfeiters in China

Bank of China Ltd. turned over records in a case brought by Gucci America Inc. after a U.S. judge fined it $50,000 a day for not complying with subpoenas seeking information about Chinese makers of counterfeit luxury goods reports Bloomberg.

U.S. District Judge Richard Sullivan in New York found the Beijing-based bank in contempt in November for disobeying orders to turn over account information Gucci wanted to help it trace and recover money from the sale of counterfeits. Bank of China claimed Sullivan lacked the authority to order it to produce evidence and said doing so would force it to violate China’s banking laws.

Sullivan’s order cited the bank’s “refusal to comply with U.S. law, while it continues to receive the benefits attendant to its banking activity in the United States.” He said the bank was “flouting” his orders.

"By making today’s document production, BOC has complied with the court’s orders and believes it has purged its contempt," David Esseks, a lawyer for the bank, said in a letter to Sullivan on Wednesday. Esseks said Bank of China believes the document production means it is no longer liable for the daily sanction.

Bank of China, which is controlled by the Chinese government, is one of the biggest banks in the world, with global assets of about $2.5 trillion, $65 billion of which are held by five branches in the U.S.

Brett Philbin, the bank’s spokesman at public relations firm Edelman, didn’t immediately respond to a request for comment on Wednesday’s letter. Floriane Geroudet, a spokeswoman for Gucci’s Paris-based parent, Kering SA, didn’t immediately return an e-mail after business hours there.

The case is Gucci America Inc. v. Weixing Li, 10-cv-04974, U.S. District Court, Southern District of New York (Manhattan).



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Gucci loses GG trademark in the UK

GUCCI luxury fashion house has had its GG trademark revoked after nearly 20 years on the UK register.

The trade mark application, submitted by Luke Connelly, was opposed by the Italian fashion house earlier this autumn on the grounds that the logo was too similar to the interlocking GG logo held under trademark by Gucci.

Gucci claimed there was a notable visual link between the two trademarks and it would offer an “unfair advantage” to Connelly, who submitted the trademark application to use the logo for clothing.

It was also claimed that “Gucci’s reputation may suffer damage by association with a non-luxury or low cost fashion brand.”

Connelly logo left, Gucci logo right

The UK Intellectual Property Office (IPO) wiped away the interlocking double G logo, registered in 1984, on the grounds of non-use.

But in the decision on November 5, the IPO’s Judy Pike said Gucci can continue using the mark to sell goods (including perfumes and soaps) under class 3.

Gucci registered the GG logo in four classes – 3, 14, 18 and 25 – in the UK. Between them, the classes cover goods such as antiperspirants, watches, handbags and t-shirts.

In June 2012 Fashion rival Gerry Weber applied to revoke the mark for a lack of use, dating from 2003 to 2012.

UK trademarks can be revoked if they are not used within a five-year period following their registration.

Gucci’s response, filed by in-house counsel Vanni Volpi, was criticised by Pike for being unspecific. For example, Volpi provided figures on sales of goods in various years, but did not state whether they were UK sales.

Gerry Weber claimed Gucci’s evidence fell “far short” of the mark for showing genuine use, which “cannot be proven by probabilities or suppositions, but must be demonstrated by solid and objective evidence” when talking with DrapersOnLine.

In a 44-paragraph ruling, Pike revoked the mark covering classes 14, 18 and 25. Her reasons included Gucci submitting leather belts in its exhibits, despite class 25 expressly limiting belts to textile belts, and a lack of sales invoices.

There were, however, some invoices provided for class 3 goods, and better evidence overall to show use in this class, meaning the mark stays registered for this specification.

According to the decision, class 3 covers “Non-medicated toilet preparations, cosmetic preparations, perfumes, soaps, dentifrices, preparations for the hair; anti-perspirants, depilatory preparations”.

The decision means Gucci cannot protect the GG logo under classes 14, 18 and 25, which cover goods such as scarves and coats, in the UK.

But the hearing officer rejected Gucci’s claim on the grounds that the two logos were “visually similar only to a very low degree.”
Gucci was ordered to pay £400 towards Connelly’s legal expenses, as he represented himself.

Gucci also entered and lost lost a four year battle with brand Guess, from which it had been seeking $221m (£138m) damages on the grounds of trademark infringement, counterfeiting and unfair competition in May this year. Gucci did however, win when they were awarded 144.2 Million Dollars in Case Against Counterfeit Fake Fashion in the same year.

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Gucci Awarded 144.2 Million Dollars in Case Against Counterfeit Fake Fashion

Counterfeit Gucci dust bag

Gucci America has been awarded 144.2 million dollars in damages in a case against online fake fashion counterfeiters.

Gucci filed the lawsuit against the counterfeiters in May 2013, alleging the abuse of the Gucci name and trademark to sell counterfeit goods online. Amidst the defeat of the luxury brand house shock defeat Guess Wins Trademark Suit in Italy which was a humiliating defeat at the same time. The luxury house was not about to lose again.

Gucci got out their legal big guns and went to battle pulling no punches successfully showing that the domain names used publicity campaigns very similar to those of the Italian luxury brands, as well as official product images and descriptions to try and coax consumers into purchasing counterfeit goods.

The company’s president and CEO, Patrizio de Marco, stated that “We are extremely pleased that the court clearly understood the dangers to consumers posed by online counterfeiting organisations and has sent a strong message that counterfeiters can expect to receive severe sanctions when caught.”

According to the presiding judge, US District Court Judge William P. Dimitrouleas, the amount in damages awarded includes the additional amount of interest from the date the lawsuit was filed.

Counterfeit Gucci sneakers advertised on website

As well as successfully proving this the U.S. district court for the Southern District of Florida also ordered ”the immediate surrender to Gucci of 155 domain names used in the counterfeiting operation.”

What does this mean now for the counterfeit market coming on the announcement that Taobao Market Teams up with Louis Vuitton to Remove Counterfeit of the massive Chinese online market place Alibaba e-commerce site. And who can forget Taobao.com signed a similar agreement with Gucci themselves a few years back Taobao Teams Up With Gucci and Apple to Remove Counterfeit Products.

This victory shows the major brands are no longer going to sit back and let counterfeits infringe on trademarks and profits.

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Guess Wins Trademark Suit in Italy

GUESS Inc. reigned victorious in its second trademark faceoff against luxury giants Gucci in Italy.

An Italian court in Milan rejected Guccio Gucci SpA’s claim that Guess had violated several of its trademarks and even took the step of canceling three of the marks Gucci had registered for Italy and the European Community. Gucci said it will “certainly bring an appeal.”

It’s a win for Guess, after Gucci prevailed last May (see Delortae Agency Report as early as last April) in federal court in Manhattan on a suit raising ostensibly the same issues. Gucci won a qualified victory, when the court awarded it only $4.7 million in damages, a fraction of the more than $221 million it sought.

The Milan decision, an 83-page verdict made public Friday, serves to cancel the diamond pattern, G logo and “Flora” pattern trademarks previously registered by Gucci in Italy and the EU, noting specifically that the “Flora” logo is “not distinct.” Additionally, the court held that Guess’s Quattro G-diamond pattern isn’t related to Gucci’s interlocking double-G pattern.

Guess sought the nullification of the designs in a counter claim following the 2009 filing of the suits in New York and Milan by Gucci.

Gucci bottom and Guess above

A Guess spokeswoman confirmed that Gucci’s other suits against Guess in both China and France are ongoing.

Paul Marciano, chief executive officer of Guess, commented, “In my opinion, the three-year battle in New York and four years in Milan was a result of massive and unnecessary litigation that should have been easily resolved with a simple phone call, which Gucci never made.”

Marciano continued, “The tactics of Gucci are nothing less than bullying. Because of their endless resources, Gucci has been forum shopping all over the world to try and stop Guess from expanding its successful accessories business. It’s fundamentally wrong and unconscionable.”

Gucci described the use of a number of G-based logos by Guess as “unlawful and parasitic free-riding on Gucci’s trademark and, in general, its brand image.”

Gucci said it would “certainly bring an appeal against the above decision, which in its view is potentially dangerous for the protection of ‘Made in Italy.’ In particular, Gucci will ask that the Court of Appeals entirely set aside said decision, by granting both its trademark infringement and unfair competition claims against Guess.”

Pier Luigi Roncaglia, of the Italian law firm Studio Legale SIB, which provided outside counsel for Gucci, said that the trademark matter was secondary in the decision and that the marks were generally not being used by the brand.

“The important aspect of the decision was unfair competition,” he told WWD. “Our main argument, and the one that was recognized in the case in New York, was that those marks were associated with the reputation of Gucci and that Guess was trying to get a free ride based on Gucci’s reputation. That was the core of the litigation and the judge [in Milan] ignored the decision in the U.S., which essentially said that Guess didn’t independently create those designs. That will be the basis for our appeal and the strongest argument for a reversal of the decision.”

Daniel Petrocelli of the law firm O’Melveny & Myers LLP, which has provided outside counsel for Guess for many years, asserted, “This case was heard in the birthplace of Gucci and the bottom line is that every single one of its claims was rejected and Guess’ counterclaim was granted.”

He said that Gucci and Guess were still waiting for the scheduling of cases in China and France.

A trademark attorney not involved in the case, Robert Tucker, a partner at Tucker & Latifi LLP in New York, said, “That a court in New York and another in Milan came down with different findings on the same issue is not unusual. Gucci was probably buoyed by the decision in New York and figured it had a slam-dunk in Italy, where it would enjoy hometown advantage.

“These two companies shouldn’t be litigating,” he said. “Any time it’s one titan versus another, it’s really important to look at the downside.”

With words like  “unlawful and parasitic free-riding on Gucci’s trademark and, in general, its brand image.” being banded about, this is sure to be a case that will continue and we will certainly follow every word!

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