KAWS v. Individuals

Background

KAWS, Inc. applied for a preliminary injunction against the defendants listed on Schedule A to the order. The application concerned defendants allegedly using online marketplace accounts and other internet stores to sell counterfeit versions of KAWS products. The court stated that the products allegedly incorporated KAWS copyrights and used or infringed KAWS trademarks. No defendants appeared at the May 10, 2023 conference.

The court found that it had personal jurisdiction over the defendants because they targeted consumers in the United States, including New York, and offered to sell and ship products into the district.

Court’s Analysis

For a preliminary injunction, the court considered whether KAWS, Inc. showed a likelihood of success on the merits, likely irreparable harm without an injunction, a favorable balance of hardships, and that an injunction would serve the public interest.

The court found a likelihood of success on the copyright claims. KAWS, Inc. provided evidence of valid copyright registrations and evidence that the defendants’ allegedly infringing products looked substantially similar to KAWS products and were sold without KAWS, Inc.’s consent. The court also found likely irreparable harm from injury to goodwill, brand confidence, reputation, exclusivity, and future sales. It found that the balance of hardships favored KAWS, Inc. and that the public interest favored an injunction because it would reduce consumer confusion and support respect for intellectual-property rights.

Order

The court ordered that the restraints first imposed in the April 14, 2023 temporary restraining order and extended on April 21, 2023, remain in place during the litigation. It issued a preliminary injunction under Federal Rule of Civil Procedure 65.

The injunction barred the identified defendants and people acting with them from using KAWS copyrights, trademarks, reproductions, counterfeit copies, or colorable imitations in connection with selling or advertising products. It also barred passing off products as genuine KAWS products, conduct likely to cause consumer confusion, further infringement, movement or disposal of unauthorized products, use of specified online accounts or stores, and operation of websites involved in selling products using the KAWS copyrights or trademarks.

Within 14 days after receiving notice, each identified defendant was required to provide KAWS, Inc. with a sworn written report identifying the defendant’s true name and physical address, websites and marketplace accounts, financial accounts, and steps taken to comply with the injunction. Online marketplace platforms were directed to disable specified accounts. Third-party service providers were directed to provide expedited discovery about the defendants’ identities, locations, operations, sales, finances, accounts, and domains.

The order also temporarily barred the defendants and persons acting with them from transferring or disposing of their money or other assets. It directed Western Union to block specified transfers, and directed online marketplaces, banks, payment processors, and other financial institutions to locate and restrain connected accounts and funds. KAWS, Inc. was required to provide notice through electronic publication and email. Schedule A and an exhibit to a declaration were unsealed. Defendants subject to the order could appear and seek to dissolve or modify it on two days’ notice or shorter notice set by the court. The $5,000 bond posted by KAWS, Inc. was to remain with the court until the case reached a final disposition or the injunction ended.

The order was a preliminary ruling based on the showing required for interim relief; it did not state that the court had entered a final judgment on the copyright or trademark claims.