Chanel, Inc. v. Li et al

Filing 1

COMPLAINT for Damages and Injunctive Relief against All Defendants. Filing fee $ 350.00 receipt number 113C-4194719, filed by Chanel, Inc.. (Attachments: # 1 Civil Cover Sheet, # 2 Summon(s))(Gaffigan, Stephen)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO.
CHANEL, INC.,
Plaintiff,
vs.
XIANGNENG LI and DOES 1-10,
Defendants.
/
COMPLAINT FOR DAMAGES AND INJUNCTIVE RELIEF
Plaintiff Chanel, Inc. (“Chanel”) hereby sues Defendants Xiangneng Li (“Li”) and Does
1-10 (collectively, "Defendants"), doing business and conspiring to do business as the domain
names identified on Schedule “A” hereto (collectively, the “Subject Domain Names”), and
alleges as follows:
JURISDICTION AND VENUE
1.

This is an action for federal trademark infringement, counterfeiting, false

designation of origin, and cybersquatting pursuant to 15 U.S.C. §§ 1114, 1116, 1121, 1125(a),
and 1125(d). Accordingly, this Court has jurisdiction over this action pursuant to 15 U.S.C. §
1121 and 28 U.S.C. §§ 1331 and 1338.
2.

This Court has personal jurisdiction over Defendants in that they transact business

with and direct their illegal activities toward consumers in the State of Florida and this judicial
district through at least the fully interactive, commercial Internet websites operating under the
Subject Domain Names.

3.

Venue is proper in this Court pursuant to 28 U.S.C. § 1391 since Defendants are,

upon information and belief, aliens who engage in infringing activities and cause harm within
this judicial district. Defendants have also advertised and made sales into this judicial district.
THE PLAINTIFF
4.

Chanel is a corporation duly organized under the laws of the State of New York

with its principal place of business in the United States located at Nine West 57th Street, New
York, New York 10019. Chanel operates boutiques throughout the world, including within this
judicial district. Chanel is, in part, engaged in the business of manufacturing and distributing
throughout the world, including within this judicial district, a variety of high quality luxury
goods under multiple world famous common law and federally registered trademarks including
those identified in Paragraph 7 below.
THE DEFENDANTS
5.

Defendant Li is an individual who, upon, information and belief, reside in the

People’s Republic of China. Defendant Does 1-10 are individuals and/or business entities of
unknown makeup who likely reside in the People’s Republic of China. Defendants are the past
and present moving and conscious forces behind the operation of the commercial Internet
websites operating under the Subject Domain Names. Defendants conduct pervasive business
throughout the United States, including within this judicial district through the operation of fully
interactive commercial websites existing under the Subject Domain Names. Upon information
and belief, Defendants have anonymously registered and maintained the Subject Domain Names
for the sole purpose of engaging in illegal counterfeiting activities. Chanel is presently unaware
of the true names of Does 1-10, although they are generally identified as co-owners, operators,

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partners, or managing agents of the Subject Domain Names. Chanel will amend this Complaint
upon discovery of the identities of such fictitious Defendants.
6.

Upon information and belief, Defendants engage in the advertisement, offering

for sale and sale of counterfeit Chanel-branded goods to consumers within this judicial district
through multiple fully interactive commercial websites operating under, at least, the Subject
Domain Names. Defendants, upon information and belief, also operate additional websites which
promote and offer for sale counterfeit Chanel-branded goods under domain names not yet known
to Chanel. Defendants have purposefully directed some portion of their illegal activities towards
consumers in the State of Florida through the advertisement, offer to sell, sale and shipment of
their counterfeit Chanel-branded goods into the State.
COMMON FACTUAL ALLEGATIONS
A.

Plaintiff's Business and Trademark Rights
7.

Chanel is the owner of the following trademarks registered on the Principal

Register of the United States Patent and Trademark Office, all of which are valid and
incontestable pursuant to 15 U.S.C. § 1065 (collectively, the "Chanel Marks"):

Trademark

Registration
Number

Registration
Date

CHANEL

0,626,035

May 1, 1956

IC 018 – Women’s Handbags

January 15,
1985

IC 018 - Leather Goods-Namely,
Handbags, [Wallets, Travel Bags,
Luggage, Credit Card And Business
Card Cases, Make-Up Bags and
Vanity Cases Sold Empty, BriefcaseType Portfolios; Attaché Cases,
Change Purses, Suitcases, Tote Bags,
Garment Bags and Travelers' Shoe
Bags]

1,314,511

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Class(es)/Goods

CHANEL

1,347,677

July 9, 1985

IC 018 - Leather Goods-namely,
Handbags [Wallets, Travel Bags,
Luggage, Business and Credit Card
Cases, Brief Case Type Portfolios,
Attaché Cases, Change Purses,
Suitcases, Tote Bags, Make-Up Bags
and Vanity Cases Sold Empty,
Garment Bags for Travel and
Travelers' Shoe Bags]

1,733,051

1,734,822

CHANEL

IC 018 - Leather Goods; namely,
Handbags, Wallets, Travel Bags,
November 17, Luggage, Business and Credit Card
1992
Cases, Change Purses, Tote Bags,
Cosmetic Bags Sold Empty, and
Garment Bags for Travel
IC 018 - Leather Goods; namely,
Handbags, Wallets, Travel Bags,
November 24,
Luggage, Business Card Cases,
1992
Change Purses, Tote Bags, and
Cosmetic Bags Sold Empty

The Chanel Marks are used in connection with the manufacture and distribution of high quality
goods in the categories identified above.
8.

The Chanel Marks have been used in interstate commerce to identify and

distinguish Chanel's products for an extended period of time and serve as symbols of Chanel’s
quality, reputation, and goodwill.
9.

Further, Chanel has expended substantial time, money and other resources

developing, advertising and otherwise promoting the Chanel Marks. The Chanel Marks qualify
as famous marks as that term is used in 15 U.S.C. §1125(c)(1).
10.

Chanel has extensively used, advertised, and promoted the Chanel Marks in the

United States in association with the sale of its high quality products. As a result, the Chanel
Marks are among the most widely recognized trademarks in the United States, and the
trademarks have achieved secondary meaning.
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11.

Chanel has carefully monitored and policed the use of the Chanel Marks and has

never assigned or licensed the Chanel Marks to any of the Defendants in this matter.
B.

Defendants' Business and Infringing Activities
12.

Defendants have registered, established or purchased, and maintained the Subject

Domain Names.
13.

Moreover, Defendants have registered the Subject Domain Names using marks

which are nearly identical and/or confusingly similar to at least one of the Chanel Marks.
14.

Upon information and belief, Defendants will continue to register new domain

names for the purpose of selling and/or offering for sale goods bearing counterfeit and
confusingly similar imitations of the Chanel Marks unless preliminarily and permanently
enjoined.
15.

Defendants have registered and/or used the Subject Domain Names with the bad

faith intent to profit from the Chanel Marks.
16.

Defendants do not have, nor have they ever had, the right or authority to use the

Chanel Marks. Further, the Chanel Marks have never been assigned or licensed to be used on any
of the websites operating under the Subject Domain Names.
17.

Upon information and belief, Defendants have never used any of the Subject

Domain Names in connection with a bona fide offering of goods or services.
18.

Upon information and belief, have not made any a bona fide non-commercial or

fair use of the Chanel Marks on a website accessible under the any of the Subject Domain
Names.

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19.

Upon information and belief, Defendants have intentionally incorporated the

Chanel Marks in their domain names to divert consumers looking for Chanel’s Internet website
to their own Internet websites for commercial gain.
20.

Defendants’ Subject Domain Names and any other domain names used in

connection with the sale of counterfeit and infringing goods bearing the Chanel Marks are
essential components of Defendants’ counterfeiting and infringing activities and are the means
by which Defendants further their counterfeiting schemes and cause harm to Chanel. Moreover,
Defendants are using Chanel famous name and trademarks to drive Internet consumer traffic to
their websites operating under the Subject Domain Names, thereby increasing the value of the
Subject Domain Names at Chanel's expense.
21.

Defendants’ entire Internet-based website businesses amount to nothing more

than illegal operations established and operated in order to infringe the intellectual property
rights of Chanel.
22.

Chanel has discovered Defendants are promoting and advertising, distributing,

selling, and/or offering for sale goods in interstate commerce that bear counterfeit and
confusingly similar imitations of the Chanel Marks, including without limitation handbags (the
“Counterfeit Goods”), through the fully interactive commercial websites operating under Subject
Domain Names. Specifically, upon information and belief, Defendants are using identical copies
of the Chanel Marks for different quality goods.
23.

Despite the nature of the Counterfeit Goods and the knowledge they are without

authority to do so, Defendants, upon information and belief, are actively using, promoting and
otherwise advertising, distributing, selling and/or offering for sale substantial quantities of their
Counterfeit Goods with the knowledge that such goods will be mistaken for the genuine high

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quality goods offered for sale by Chanel. The net effect of Defendants’ actions will result in the
confusion of consumers who will believe Defendants’ Counterfeit Goods are genuine goods
originating from, associated with, and approved by Chanel.
24.

Defendants advertise their Counterfeit Goods for sale to the consuming public via

websites operating under at least the Subject Domain Names. In so advertising these goods,
Defendants use the Chanel Marks without Chanel's permission. Indeed, Defendants herein
misappropriated Chanel’s advertising ideas and entire styles of doing business with regard to the
advertisement and sale of Chanel’s genuine goods. Upon information and belief, the
misappropriation of Chanel’s advertising ideas in the form of the Chanel Marks is the proximate
cause of damage to Chanel.
25.

Upon information and belief, Defendants are targeting their counterfeiting and

infringing activities toward consumers and causing harm within this judicial district and
elsewhere throughout the United States. As a result, Defendants are defrauding Chanel and the
consuming public for Defendants’ own benefit. Defendants’ infringement and disparagement of
Chanel and the Chanel Marks does not simply amount to the wrong description of their goods or
the failure of the goods to conform to the advertised quality or performance.
26.

Upon information and belief, at all times relevant hereto, Defendants in this action

had full knowledge of Chanel’s ownership of the Chanel Marks, including its exclusive right to
use and license such intellectual property and the goodwill associated therewith.
27.

Defendants’ use of the Chanel Marks, including the promotion and advertisement,

reproduction, distribution, sale and offering for sale of their Counterfeit Goods, is without
Chanel’s consent or authorization.

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28.

Further, Defendants are engaging in the above-described illegal counterfeiting and

infringing activities knowing and intentionally or with reckless disregard or willful blindness to
Chanel’s rights for the purpose of trading on the goodwill and reputation of Chanel. If
Defendants’ intentional counterfeiting and infringing activities are not preliminarily and
permanently enjoined by this Court, Chanel and the consuming public will continue to be
harmed.
29.

Defendants’ above identified infringing activities are likely to cause confusion,

deception, and mistake in the minds of consumers, the public, and the trade before, during, and
after the time of purchase. Moreover, Defendants’ wrongful conduct is likely to create a false
impression and deceive customers, the public, and the trade into believing there is a connection
or association between Chanel’s genuine goods and Defendants’ Counterfeit goods, which there
is not.
30.

Chanel has no adequate remedy at law.

31.

Chanel is suffering irreparable injury and has suffered substantial damages as a

result of Defendants’ counterfeiting and infringing activities.
32.

The harm and damages sustained by Chanel has been directly and proximately

caused by Defendants’ wrongful reproduction, use, advertisement, promotion, offers to sell, and
sale of their Counterfeit Goods.
COUNT I
TRADEMARK COUNTERFEITING AND INFRINGEMENT - 15 U.S.C. §1114(1)
33.

Chanel hereby adopts and re-alleges the allegations set forth in Paragraphs 1

through 32 above.
34.

This is an action for trademark counterfeiting and infringement against

Defendants based on their use of counterfeit and confusingly similar imitations of the Chanel
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Marks in commerce in connection with the promotion, advertisement, distribution, sale and/or
offering for sale of their Counterfeit Goods.
35.

Specifically, Defendants are promoting and otherwise advertising, selling,

offering for sale and distributing handbags using counterfeits and infringements of one or more
of the Chanel Marks. Defendants are continuously infringing and inducing others to infringe the
Chanel's Marks by using them to advertise, promote and sell counterfeit and infringing handbags.
36.

Defendants’ counterfeiting and infringing activities are likely to cause and

actually are causing confusion, mistake and deception among members of the trade and the
general consuming public as to the origin and quality of Defendants’ Counterfeit Goods.
37.

Defendants’ unlawful actions have caused and are continuing to cause

unquantifiable damages to Chanel.
38.

Defendants’ above-described illegal actions constitute counterfeiting and

trademark infringement of the Chanel's Marks in violation of Chanel’s rights under § 32 of the
Lanham Act, 15 U.S.C. § 1114.
39.

Chanel has suffered and will continue to suffer irreparable injury due to the

above-described activities of Defendants if Defendants are not preliminarily and permanently
enjoined.
COUNT II
FALSE DESIGNATION OF ORIGIN - 15 U.S.C. §1125(a)(l)(A)
40.

Chanel hereby adopts and re-alleges the allegations set forth in Paragraphs 1

through 32 above.
41.

Defendants’ Counterfeit Goods bearing and sold under copies of the Chanel

Marks have been widely advertised and distributed throughout the United States.

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42.

Defendants’ Counterfeit Goods bearing and sold under copies of the Chanel

Marks are virtually identical in appearance to Chanel’s genuine goods. However, Defendants’
Counterfeit Goods are different and likely inferior in quality. Accordingly, Defendants’ activities
are likely to cause confusion among the general public as to at least the origin or sponsorship of
their Counterfeit Goods.
43.

Defendants, upon information and belief, have used in connection with their sale

of the Counterfeit Goods, false designations of origin and false descriptions and representations,
including words or other symbols and trade dress which tend to falsely describe or represent such
goods and have caused such goods to enter into commerce with full knowledge of the falsity of
such designations of origin and such descriptions and representations, all to the detriment of
Chanel.
44.

Specifically, Defendants have authorized infringing uses of the Chanel Marks in

Defendants’ advertisement and promotion of their counterfeit and infringing Chanel-branded
handbags. Defendants have misrepresented to members of the consuming public that the
Counterfeit Goods being advertised and sold by them are genuine, non-infringing goods.
45.

Defendants’ above-described actions are in violation of Section 43(a) of the

Lanham Act, 15 U.S.C. §1125(a).
46.

Defendants’ unlawful actions have caused and are continuing to cause

unquantifiable damages to Chanel.
47.

Chanel has suffered and will continue to suffer irreparable injury due to the

above-described activities of Defendants if Defendants are not preliminarily and permanently
enjoined.

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COUNT III
CLAIM FOR RELIEF FOR CYBERSQUATTING - 15 U.S.C. §1125(d)
48.

Chanel hereby adopts and re-alleges the allegations set forth in Paragraphs 1

through 32 above.
49.

Upon information and belief, Defendants have acted with the bad faith intent to

profit from the Chanel Marks and the goodwill associated with the Chanel Marks by registering
the Subject Domain Names.
50.

The Chanel Marks were distinctive and famous at the time Defendants registered

the Subject Domain Names.
51.

The Subject Domain Names are identical to, confusingly similar to or dilutive of

at least one of the Chanel Marks.
52.

Defendants’ actions constitute cybersquatting in violation of §43(d) of the

Lanham Act, 15 U.S.C. §1125(d).
53.

Defendants’ unlawful actions have caused and are continuing to cause

unquantifiable damages to Chanel.
54.

Chanel has suffered and will continue to suffer irreparable injury due to the

above-described activities of Defendants if Defendants are not preliminarily and permanently
enjoined.
PRAYER FOR RELIEF
55.

WHEREFORE, Chanel demands judgment on all Counts of this Complaint and an

award of equitable relief and monetary relief against Defendants jointly and severally as follows:
a.

Entry of a temporary restraining order and preliminary and permanent

injunctions enjoining Defendants, their agents, representatives, servants, employees, and all
those acting in concert or participation therewith, from manufacturing or causing to be
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manufactured, purchasing, importing, advertising or promoting, distributing, selling or offering
to sell counterfeit goods bearing the Chanel Marks; from infringing, counterfeiting, or diluting
the Chanel Marks; from using the Chanel Marks, or any mark or trade dress similar thereto, in
connection with the sale or offering to sell of any unauthorized goods; from using any logo, trade
name or trademark or trade dress which may be calculated to falsely advertise the services or
goods of Defendants as being sponsored by, authorized by, endorsed by, or in any way
associated with Chanel; from falsely representing themselves as being connected with Chanel,
through sponsorship or association, or engaging in any act which is likely to falsely cause
members of the trade and/or of the purchasing public to believe any goods or services of
Defendants are in any way endorsed by, approved by, and/or associated with Chanel; from using
any reproduction, counterfeit, copy, or colorable imitation of the Chanel Marks in connection
with the publicity, promotion, sale, or advertising of any goods sold by Defendants, including,
without limitation, handbags; from affixing, applying, annexing or using in connection with the
sale of any goods, a false description or representation, including words or other symbols tending
to falsely describe or represent Defendants’ goods as being those of Chanel, or in any way
endorsed by Chanel and from offering such goods in commerce; and from otherwise unfairly
competing with Chanel.
b.

Entry of an order requiring the Subject Domain Names, and any other

domain names being used by Defendants to engage in the business of selling goods bearing
counterfeits and infringements of the Chanel Marks to be disabled and/or immediately
transferred by Defendants, their Registrars and/or the Registries to Chanel’s control.
c.

Entry of an Order that, upon Chanel’s request, the top level domain (TLD)

Registry for each of the Subject Domain Names place the Subject Domain Names on Registry

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Hold status, thus removing them from the TLD zone files maintained by the Registries which
link the Subject Domain Names to the IP address where the associated websites are hosted.
d.

Entry of an Order that, upon Chanel’s request, any Internet search engines,

Web hosts, domain-name registrars and domain-name registries or administrators which are
provided with notice of the injunction, cease facilitating access to any or all websites through
which Defendants engage in the promotion, offering for sale and/or sale of counterfeit and/or
infringing goods using the Chanel Marks.
e.

Entry of an Order that, upon Chanel’s request, the Internet Corporation for

Assigned Names and Numbers (“ICANN”) shall take all actions necessary to ensure that the
Registrars and top level domain Registries responsible for the Subject Domain Names facilitate
the transfer and/or disable the Subject Domain Names.
f.

Entry of an Order requiring Defendants to account to and pay Chanel for

all profits and damages resulting from Defendants’ trademark infringing and counterfeiting and
unfairly competitive activities and that the award to Chanel be trebled, as provided for under 15
U.S.C. §1117, or, at Chanel’s election with respect to Count I, that Chanel be awarded statutory
damages from each Defendant in the amount of two million dollars ($2,000,000.00) per each
counterfeit trademark used and product sold, as provided by 15 U.S.C. §1117(c)(2) of the
Lanham Act.
g.

Entry of an Order requiring Defendants to account to and pay Chanel for

all profits and damages resulting from Defendants’ cybersquatting activities and that the award
to Chanel be trebled, as provided for under 15 U.S.C. §1117, or, at Chanel’s election with respect
to Count III, that Chanel be awarded statutory damages from Defendants in the amount of one

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hundred thousand dollars ($100,000.00) per infringing domain name used as provided by 15
U.S.C. §1117(d) of the Lanham Act.
h.

Entry of an award of Chanel’s costs and reasonable attorneys’ fees and

investigative fees associated with bringing this action.
i.

Entry of an order requiring all funds, up to and including the total amount

of judgment, in payment accounts or money transfer systems used in connection with the Subject
Domain Names, including but not limited to PayPal, Inc., The Western Union Company,
MoneyGram and other payment processing accounts, to be surrendered to Chanel in partial
satisfaction of the monetary judgment entered herein.
j.

Entry of an award of pre-judgment interest on the judgment amount.

k.

Entry of an Order for any further relief as the Court may deem just and

proper.
DATED: October 31, 2011.

Respectfully submitted,

STEPHEN M. GAFFIGAN, P.A.
By: ______s:/smgaffigan/_________________
Stephen M. Gaffigan (Fla. Bar No. 025844)
Virgilio Gigante (Fla. Bar No. 082635)
401 East Las Olas Blvd., Suite 130-453
Ft. Lauderdale, Florida 33301
Telephone: [phone]
Facsimile: [phone]
Email: [e-mail]
E-mail: [e-mail]
Attorneys for Plaintiff Chanel, Inc.

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SCHEDULE “A”
SUBJECT DOMAIN NAMES
1.
2.
3.
4.
5.
6.
7.
8.

chanel-australia.com
chanel-australia.net
chanel-australia.org
chanelcanada.com
chanelcanada.net
chanelcanada.org
chanelukbags.com
onlinechanelstore.com

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