An Unlikely Duo: Valentino and Amazon Initiate a Joint Lawsuit against a Chinese Counterfeiter

*** The writing does not, and is not intended to, constitute legal advice by any means***

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VALENTINO'S GARAVANI ROCKSTUD

Valentino and Amazon teamed up to go after a Chinese counterfeiter that sold on Amazon counterfeit versions of Valentino's "Garavani Rockstud" shoes. According to the joint complaint, Kaitlyn Pan Group and Hao Pan (collectively "the Defendants") "blatantly cop[ied] the iconic look and design" of Garavani Rockstud and therefore "infring[ed] Valentino's trademark and design patents". See Complaint at 2, Amazon, Inc. and Valentino S.P.A. v. Kaitlyn Pan Group, LLC and Hao Pan, 2:20-cv-00934 (W.D. Wash.). Aside from its legal aspect, the joint lawsuit comes at a time when the relationship between Amazon and luxury fashion can be characterized as uneasy and tenuous at minimum. Luxury fashion brands have faulted Amazon for not doing enough to detect knock-offs, thereby harming the prestige they have painstakingly burnished and thus duly earned in the marketplace. In response, the e-commerce titan allowed brands to remove online listings of counterfeits and developed more sophisticated algorithms to catch them. Against this backdrop, the concerted legal action of this unlikely duo can be interpreted to signal a substantive change in market dynamics: a true union of luxury and third-party e-commerce.

Back to the lawsuit! Amazon and Valentino claim that the Defendants contravened Amazon's Anti-Counterfeit Policy as a third-party seller when it "marketed, sold, and distributed" counterfeit products in flagrant violation of Valentino's rightfully obtained intellectual property (IP) rights. Id. at 21. Amazon and Valentino further allege that the Defendants continued to engage in their illicit course of dealing even after being put on notice by first Valentino and then Amazon by means of cease-and-desist letters. Id. at 20. The complaint highlights that the Defendants "had full knowledge" of Valentino's intellectual property rights in connection with Garavani Rockstud but proceeded to file a trademark application under their own name. Id. In sum, Valentino and Amazon cogently make a case that the Defendants acted with bad faith and seek both damages and equitable (injunction in this case) relief. Although, Kaitlyn Pan Group and Hao Pan still have some time to submit their own complaint with counterclaims, given the facts of the case, it seems highly unlikely to me that the Defendants would prevail. A chain of events leading up to this IP infringement lawsuit undisputedly evinces the bad faith on the part of the Defendants. 

AN EXHIBIT FROM THE JOINT COMPLAINT

Amazon announced that the monetary damages obtained from the lawsuit would go entirely to Valentino. Some people might question Amazon's motive in waging a legal battle with no direct pecuniary benefit accruing to it. However, Amazon has a legitimate interest in the outcome of the case because what's at stake is the integrity of its platform for luxury fashion brands that are desperate to find new avenues to sell off their inventories. As Business of Fashion recently suggested, Amazon can be a potential channel of distribution in the era of the pandemic. Plus, Amazon is reportedly set to launch a separate platform for luxury brands that it estimates to worth potentially $5 trillion. Therefore, if Amazon does not act resolutely in addressing the counterfeit issue, no luxury fashion brands would be willing to put their products on its electronic shelves. Can the tango between luxury fashion and Amazon be in perfect step? I wish so.