Legal Question in Intellectual Property in Minnesota

A lawsuit was filed recently against an online store run by someone I know. This person I'll call 'Ann', created the store herself to make some extra money, found a wholesaler to go through and made a little home made website. Ann listed what she thought were real Coach handbags on this website and eventually sold one. Turns out, a Coach representative purchased the handbag and shortly after Ann had a 2 million dollar lawsuit filed against her store from Coach. Ann was unable to attend the hearing which was several states away to defend herself due to lack of funds. The hearing ended up with Coach settling on $800,000.00. Ann profited $12.00...yes twelve dollars, on the handbag she sold. She had several other ones for sale as well, which of course were all taken down when the lawsuit was filed. What will happen to Ann? Since the lawsuit was filed in the stores name and not her own, will it affect her home and personal property? The store no longer exists. The store had not and will not ever file a business tax return because little to no money was ever made on the store. How will Coach get their money? The business address is of course her home address, will they put a lien against her personal home for their money if it's not paid? How many months can you go without paying before they take drastic measures? WIll they garnish her wages and personal tax returns?


Asked on 11/01/11, 9:36 am

1 Answer from Attorneys
Patrick Tracy Patrick J. Tracy, Esq, P.E.,

There are a number of factors that need to be considered here. If she was a sole proprietor, then any asset that she owns could be used to satisfy the judgement. These are known as grey market goods or knockoff goods. My experience in these areas says that such a trademark as Coach wants to remove any goods such as this so they are diligent and in turn there is no dilution of their mark. In many ways "Ann" is negligent by not investigating the authenticity of the goods and/or if there were claims made by the wholesaler that these were authentic she may have a case against the wholesaler for the judgement.

She needs to talk to a trademark lawyer before this goes much further, they may come after her for the 800,000

Patrick Tracy

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Answered on 11/01/11, 9:49 am


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