Coach Wins $44M Judgment Against Mother-Daughter Counterfeiting Duo

It may be Friday, but things have yet to wind down in the fashion law world. Coach Inc. has joined the growing list of companies busting Web sites advertising and selling counterfeit bags. According to WWD, a Manhattan federal court just granted the company a $44 million judgment against online counterfeiters for 22 counts of trademark infringement. 

What makes this case so unusual is that the websites were operated by a mother-daughter duo, Linda and Courtney Allen, based in the United States. Often, such operations are located in foreign countries. Furthermore, it looks like the defendants have a criminal history in counterfeiting, when in 2007 they were sued by Chanel Inc. for the same illegal conduct while operating MyClassyFashion.com and UltimateDesignersHandbags.com. According to Judge Colleen McMahon, “Linda Allen plainly requires substantial deterrence because she has not been deterred by prior judgments. She persists in her contumacious behavior. This award may be crippling, but it is plainly needed to prevent Allen from going back once again into the business of counterfeiting.”

As mentioned on our previous posts on similar infringement cases, such damages are normally impossible to collect from foreign-based defendants. The value of these judgments is in ceasing operations and sending a message to the counterfeiters that their illegal conduct will not go unpunished. We are curious to see whether the damages in this case are more likely to be collected when the defendant is based in the United States. Either way, it's clear the Internet is no longer a safe harbor for such counterfeiting operations.