Loewe, S.A. v. Beijing Onward Fashion Co., Ltd.

Background

Loewe, S.A. applied without notifying the defendants for emergency relief against the defendants listed in the order, including Beijing Onward Fashion Co., Ltd. and numerous other entities and online storefronts. Loewe alleged that the defendants were offering or selling counterfeit products bearing Loewe’s trademarks or using Loewe’s design. The application relied on claims under the Lanham Act and Patent Act.

The court stated that it had reviewed the application, declarations from Nicolas Lambert and Gabriela N. Nastasi, exhibits, and other supporting evidence. It found that Loewe was likely to prevail on its Lanham Act and Patent Act claims at trial. The court also found that the alleged infringement could cause immediate and irreparable losses, damages, and injuries to Loewe and consumers before the defendants could respond. The court specifically cited possible consumer confusion and disappointment, harm to Loewe’s reputation and goodwill, lost sales, and the risk that defendants would conceal or transfer products, records, or proceeds or open new accounts under different names.

Temporary Restraining Order

The court granted Loewe’s application and temporarily restrained the defendants from manufacturing, importing, exporting, advertising, marketing, distributing, displaying, offering for sale, selling, or otherwise dealing in counterfeit products or products bearing the Loewe marks or design, or marks confusingly similar to them. The order also prohibited operation of the defendants’ identified user accounts and merchant storefronts in violation of the order; direct or indirect infringement; unauthorized use of Loewe marks; infringement of the Loewe design; and conduct likely to cause confusion about affiliation, origin, sponsorship, or approval.

The restrictions applied in the United States, except that provisions barring concealment, destruction, transfer, or disposal of products, records, and evidence, and provisions barring efforts to evade the order through new entities, platforms, accounts, or storefronts, applied worldwide. The order also prohibited knowingly instructing others to engage in the listed activities.

Asset Restraint and Online Accounts

The order restrained defendants and qualifying persons who received actual notice from secreting, concealing, transferring, disposing of, withdrawing, encumbering, or paying defendants’ assets from or to defendants’ financial accounts. It directed the financial institutions served with the order to locate and attach defendants’ financial accounts within five days and provide written confirmation to Loewe’s counsel.

The order separately required third-party service providers served with it to stop, within five days, operation of the identified user accounts and merchant storefronts in violation of the order. It also barred those providers from instructing, aiding, or assisting the defendants or others in continuing prohibited activities.

Service and Expedited Discovery

The court authorized alternative service by electronic means under Federal Rule of Civil Procedure 4(f)(3). Although the defendants were believed to be in China, the court found that the urgency exception to the Hague Convention permitted email service. The court found that email service was reasonably calculated to provide notice and allowed service through electronic delivery of the order, summons, complaint, and supporting papers, including through specified secure websites and email addresses.

The court authorized Loewe to serve interrogatories and document requests on defendants, with responses and production due within fourteen days after service. It also ordered served financial institutions and third-party service providers to identify defendants’ accounts and storefronts within five days and to produce related records within fourteen days. The required information included account details, contact information, balances, account-opening records, transaction information, sales histories, listing histories, and information concerning the manufacture and sale of the alleged counterfeit products.

Preliminary-Injunction Hearing, Bond, and Sealing

The defendants were ordered to show cause why a preliminary injunction should not issue under Federal Rule of Civil Procedure 65(a). The order warned that failure to appear could result in a preliminary injunction against them. The order did not itself grant a preliminary injunction.

Loewe was required to post a $10,000 security bond to cover damages that a person might be entitled to recover from an improper or wrongful restraint. The complaint, supporting exhibits, ex parte application, supporting declarations, and the order were to remain sealed until December 2, 2024, subject to the court’s instructions for seeking an extension.

Result

Judge Gregory Woods granted Loewe’s application for the temporary restraining order, asset restraint, alternative electronic service, expedited discovery, security bond, and sealing provisions described in the order. The opinion does not report the result of the later preliminary-injunction hearing or the ultimate merits of Loewe’s claims.