NEW YORK Aug 18 Apple Inc (AAPL.O) has moved
swiftly and, until now, secretly to crack down on stores in the
Chinatown section of Queens, New York, accused of selling
knock-off Apple gear emblazoned with the company's distinctive
logo, according to documents unsealed Thursday in Brooklyn
Court records reveal that Apple has already seized
unauthorized iPod, iPhone and iPad accessories sold by two stores
in the Flushing neighborhood of the New York City borough of
Queens, and is now demanding the names of its customers and
suppliers. It is also asking one of the defendants -- Apple Story
-- to change its name to keep consumers from confusing the
unauthorized gear with Apple-sanctioned products.
The trademark infringement lawsuit was first filed on July
25 against Apple Story and Fun Zone Inc., both owned by New
York resident Janie Po Chiang, who is named as a co-defendant
in the suit, along with Fun Zone manager Jimmy Kwok.
But the case remained under seal until Thursday, when U.S.
District Judge Kiyo Matsumoto ordered the record to be made public
following a request from Reuters.
Under the U.S. trademark counterfeiting law, a company can
file a trademark infringement action under seal initially, so
as not to tip off the accused counterfeiters before seizure
orders are executed.
The unsealed documents show how seriously Apple is
responding to threats by pirated goods to its brand, one of the
best-known and most valuable. The lawsuit also comes amid
increasing reports of fake Apple products -- and even whole
counterfeit Apple stores -- popping up in China. [ID:nL3E7IM1GV]
'NEARLY AN EXACT DUPLICATE'
According to a court filing from Apple, the company sent
representatives to Apple Story and Fun Zone in Flushing on
"multiple occasions over several weeks," where they bought an
assortment of iPod, iPhone and iPad cases, as well as stereo
headsets designed for use with iPhones.
All of the purchased goods carried an Apple trademark,
according to the amended complaint. They were also marked with
the phrase "Designed by Apple in California. Assembled in
China," and included markings similar to those found on genuine
The headsets came with packaging that was "nearly an exact
duplicate" of that for genuine Apple goods, the lawsuit said.
"Defendants are trading on and receiving the benefit of the
goodwill Apple has established in the Apple trademarks through
considerable labor and expense over many years," Apple said in its
On July 27, Apple executed several ex parte seizure warrants
-- allowing the company to seize the items -- that swept up goods
from both stores that bore the Apple logo. Matsumoto granted
Apple's request for a preliminary injunction to stop both stores
from selling knockoff goods, but has yet to rule on whether Apple
Story must change its name.
The parties are moving toward an agreement to settle the case,
court records show, but nothing has been finalized. In addition to
an agreement to stop counterfeiting goods, Apple is seeking a
complete list of all individuals or entities who either purchased
or sold counterfeit products, an order to destroy any remaining
counterfeit products and triple monetary damages.
CRUSADE MAY CONTINUE
Even if both sides reach a deal, Apple's crusade against
the counterfeiters may continue. The lawsuit includes an
undisclosed number of individuals and businesses who made, sold or
distributed the alleged counterfeit goods.
Their identities are not yet known, but could include
entities higher up on the suspected counterfeit chain. Apple
has won a court order requiring the defendants to turn over
access to their business email accounts, which could yield clues
about other defendants to be named at a later date.
Samuel Chuang, an attorney for the defendants, declined to
comment on the case. Attorneys and a spokesperson for Apple did
not immediately return a request for comment.
The case is Apple Inc. v. Apple Story Inc et al, in the
U.S. District Court for the Eastern District of New York, no.
For Apple: Mark Mutterperl and Todd Hambidge of Fulbright &
For the defendants: Samuel Chuang of the Law Offices of
(Reporting by Jessica Dye; Editing by Phil Berlowitz)