Piechowicz v. The Partnerships and Unincorporated Associations Identified in…

Background

Libby Piechowicz, doing business as Lorna Laine, applied for emergency relief against partnerships and unincorporated associations identified in a sealed Schedule A. She alleged that the defendants were manufacturing, importing, distributing, advertising, offering for sale, and selling counterfeit products bearing or infringing two copyrights registered with the U.S. Copyright Office. The application sought a temporary restraining order, temporary control over the defendants’ online storefronts, restraint of certain assets, expedited discovery, alternative service by email or online publication, and an order requiring the defendants to show why a preliminary injunction should not issue.

Court’s findings

The court found that Piechowicz was likely to prevail at trial on copyright infringement, violation of the right of publicity, and counterfeit claims. It also found that she was likely to suffer immediate and irreparable losses and injuries before the defendants could respond. The court relied on allegations that the defendants were offering substandard and unauthorized counterfeit products and that continued sales could mislead consumers and harm Piechowicz’s reputation, goodwill, and related products. The court further found that giving notice before restraining the defendants could lead them to hide or destroy counterfeit products, records, account information, and sale proceeds.

The court found that the potential harm to the defendants from being stopped from profiting from the alleged conduct was outweighed by the potential harm to Piechowicz. It also found that the public interest favored protecting her copyrights and preventing consumers from being deceived by counterfeit products.

Order

The application was GRANTED IN PART AND DENIED IN PART. The court entered a temporary restraining order without notice that temporarily barred the defendants from using the identified copyrights or reproductions of them in connection with counterfeit products; passing off counterfeit products as genuine Piechowicz products; causing consumers to believe that counterfeit products were authorized, sponsored, or approved by Piechowicz; further infringing the copyrights; and moving, storing, selling, distributing, or disposing of unauthorized products bearing the copyrights. The order also restricted use or transfer of user accounts, defendant storefronts, domain names, and online marketplace accounts used to sell, or capable of being used to sell, counterfeit products.

Within five days after receiving the order, e-commerce platforms and storefront operators were ordered to disable user accounts associated with the alleged counterfeit sales, stop displaying related advertisements, and prevent links to the identified storefronts from appearing in search results. Payment processors and online marketplace platforms were ordered to locate, attach, and restrain the defendants’ accounts and assets—including cryptocurrency—from transfer or disposal until further court order. Those institutions also had to confirm compliance to Piechowicz’s counsel.

The court granted expedited discovery from the financial institutions acting as online marketplace platforms. To the extent the information was within their possession, custody, or control, they had to provide identifying and contact information, account numbers and balances, additional affiliated user accounts or websites, information about associated accounts and assets, and information about counterfeit-product sales or listings.

Service and other provisions

The court denied at that time Piechowicz’s request to serve defendants located in China and Germany by email or online publication. It concluded that those methods were not permitted under the Hague Convention and that Piechowicz had not shown that the defendants’ addresses were unknown or demonstrated the required attempts at contact. The court granted permission to serve defendants located in Vietnam by email or online publication because Vietnam had not objected to the relevant Hague Convention provisions. It also granted permission to serve defendants in the United States by email after finding that ordinary service was impracticable for the online businesses identified as Does 11 and 21.

The order permitted service by methods expressly allowed under the Hague Convention or by the methods approved in the order. Service was to occur within five days after the financial institutions complied with the asset-restraint and confirmation provisions. The Clerk was directed to issue one summons naming the partnerships and unincorporated associations identified in Schedule A. Piechowicz was required to deposit $5,000 as security for damages potentially caused by a wrongful restraint. The specified filings and exhibits were sealed until the defendants’ accounts and assets were restrained, after which Piechowicz was required to file unsealed versions before the order expired.

The temporary restraining order was to remain in effect for 14 days. A telephonic hearing was set for August 20, 2024, at which Piechowicz could support her request for a preliminary injunction and defendants could oppose it. Defendants subject to the order could appear and seek to dissolve or modify it on two days’ notice, or on shorter notice set by the court. Judge Vernon S. Broderick directed the Clerk to file the order ex parte and terminate the pending sealed motion.