Stillwater Designs and Audio, Inc. v. eBay Reseller archer_store (D. Mass. 23-cv-11210).

Stillwater, which does business under the trade name “Kicker,” accused eBay storefront “archer_store” of trademark counterfeiting and infringement, unfair competition, and false designation of origin under the Lanham Act.  Stillwater makes and sells audio products under a number of registered trademarks.  Stillwater alleged that , despite not being an authorized distributor, Chinese company archer_store sells products bearing Stillwater’s trademarks and advertises them as “genuine” and “new.”  Stillwater discovered upon purchasing archer_store products that they contained components not made by Stillwater, hence the counterfeiting claim.

Judge Talwani previously granted Stillwater’s motion for alternative service, allowing service to be made via eBay’s “contact seller” portal.  Archer_store did not answer or otherwise respond to the complaint.  Judge Talwani found that service was properly made, and that the complaint properly pled factual allegations to support the counterfeiting, infringement and false designation of origin claims.  She noted the standard eight factor test to show that the allegedly infringing use is likely to cause confusion (similarity of the marks, similarity of the goods, relationship between the respective channels of trade, etc.) but determined that when a defendant intentionally copies a trademark, the court can adopt a presumption of likelihood of confusion.  This presumption can be overcome only by evidence rebutting the inference.  Here, the complaint alleged (and, as archer_store defaulted, archer_store is deemed to have admitted) that archer_store’s marks were virtually identical to Stillwaters and that archer_store falsely represented itself as an authorized dealer of Stillwater products, establishing the presumption.  Judge Talwani further found that, by establishing counterfeiting and infringement, archer_store was liable for false designation of origin.

Stillwater had sought injunctive relief and $1 million in statutory damages.  Judge Talwani found that the complaint’s allegation that archer_store would likely continue its sales demonstrated the likelihood of irreparable harm, and that archer_store had no legal entitlement to the activities sought to be enjoined.  She therefore granted injunctive relief.  Regarding damages, the Lanham Act authorizes statutory damages of not less than $1000 and not more than $200,000 per counterfeit mark per type of good sold, which can be enhanced to not more than $2 million per counterfeit mark where the counterfeiting was willful.  Given that she found counterfeiting with respect to three different product types, Judge Talwani determined that the $1 million sought was well within the statutory scheme.  This amount also fell within the amount sought in the complaint, which put archer_store on notice of the potential award should it fail to defend itself.  Judge Talwani determined that this amount would compensate Stillwater , but would also serve as a deterrent to others  contemplating similar violations of the Lanham Act.