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Luxottica Group S.p.A. v. Zhao

United States District Court, N.D. Illinois, Eastern Division

March 17, 2017

LUXOTTICA GROUP S.p.A., and OAKLEY, INC., Plaintiffs,
v.
ZHIQIANG ZHAO, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          Harry D. Leinenweber Judge

         There are a host of Motions before the Court: Defendant, Eddie Store's Motion to Dismiss for Forum Non Conveniens; Plaintiff's Motion for Summary Judgment; Eddie Store's Motion to Strike certain of Plaintiff's exhibits; Plaintiff's Motion to Dismiss Defendant's Counterclaims; and Eddie Store's Motion for Release of Funds.

         I. BACKGROUND

         The Plaintiffs, Luxottica Group S.p.A. and Oakley, Inc., (collectively, the "Plaintiffs") own numerous U.S. federal trademark registrations for one of the best known eyeware brands. Defendant Eddiestore2008 ("Defendant") is a commercial internet store operating from The Peoples Republic of China. Luxottica and Oakley, an indirect, wholly-owned subsidiary of Luxottica, manufacture and distribute luxury and sports eyewear under federally register trademarks. The Oakley brand symbolizes high quality and sells some of the most recognizable eyeware as well as other related products. Oakley has used its trademarks exclusively since 1975 and has extensively used and advertised the trademarks, spending in excess of ten million dollars annually. In their Complaint, Plaintiffs contend that Defendant has used its internet store to sell products over the internet to customers in the United States, and in Illinois. Specifically, Plaintiffs charge Defendant with selling counterfeit versions of its Oakley sunglass products. Defendant acknowledges that it sold at least 79 of its sunglass products but contends that it sold only unbranded sunglasses which did not bear any of Oakley trademarks. Defendant argues alternatively that, if it sold Oakley products, they were legitimate Oakley products.

         Based on the forgoing, Plaintiffs have filed this action alleging claims relating to federal trademark infringement and counterfeiting, and seeking statutory damages and injunctive relief against Defendant. In August 2016, the Court granted Plaintiffs' Motion for a Preliminary Injunction, which among other provisions froze Defendant's PayPal account which contained the sum of approximately $459, 000.00.

         II. ANALYSIS

         A. Defendant's Motion to Dismiss for Forum Non Conveniens

         Defendant contends that this Court should dismiss this case in favor of having this litigation take place in the District People's Court of the Baiyun District, Guang Zhou City, and Guang Dong Province, China. Plaintiffs contend that Defendant has not established that a Chinese court would be an adequate forum for enforcing their United States trademark rights.

         A defendant has a heavy burden in opposing a plaintiff's choice of forum. Deb v. SIRVA, Inc., 832 F.3d 800, 810 (7th Cir. 2016) . First, a defendant must submit evidence that the requested transfer court is both available and adequate. Kamel v. Hill-Rom Co., 108 F.3d 799, 802 (7th Cir. 1997). Availability of a court is present if all parties are amenable to process and are within the forum's jurisdiction. A forum is adequate if the parties will not be deprived of all remedies or treated unfairly. Second, if the forum is available and adequate then the court weighs certain private and public interest factors. There is a strong presumption in favor of the plaintiff's choice of forum. Zelinski v. Columbia 300 Inc., 335 F.3d 633, 643 (7th Cir. 2003) . If it is determined that the proposed forum is not available or adequate, them the individual and public factors need not be discussed. Deb v. Sirva, Inc. r 832 F.3d 800, 807 (7th Cir. 2016), In arguing in favor of transfer, Defendant asserts through and affidavit of its Chinese counsel, that the Chinese District Court is an adequate forum to litigate Plaintiffs' trademark claims. However, as Plaintiffs point out, the cases relied upon by Defendant are merely citations to trademark infringement cases that were apparently decided in Chinese Courts. There were no written decisions supplied with the affidavit and there was no discussion about whether the Chinese court was applying Chinese law or United States law. There was no indication what the decisions were other than in general that injunctions were issued and damages awarded. Further the affidavit does not indicate one way or another whether a Chinese court would accept jurisdiction in this case which involves Italian companies seeking to enforce American Trademark law. Deb at 814. It is not enough to assert baldly that the proposed transferee forum is adequate. Deb at 811-12.

         However it is also true that an adequate forum need not be a perfect forum. A remedy offered by the transferee forum is only inadequate if it amounts to no remedy at all. Mere inconvenience or unavailability of beneficial litigation procedures does not render a forum inadequate. Satz v. McDonnell Douglas Corporation, 244 F.3d 1279, 1283 (11th Cir. 2004) . Since it may be that Defendant would be amenable to process in China, and the forum there might be adequate, the Court will discuss the public and private interests involved in this case.

         First, of course, is Plaintiffs' choice of forum. As Defendant points out, this is not as important a consideration as would be the case if the Plaintiffs were U.S. corporations. However, Plaintiffs still have a strong and powerful interest in litigating in the United States District Court here in the United States and Illinois. As it acknowledges, defendant attempts to and does market its products to the citizens of the United States and of Illinois. The United States is one of Plaintiffs' largest markets and plaintiff spends substantial sums of money establishing its name recognition in the United States. Its trademark rights in the United States cannot be questioned. It likewise has a strong interest in maintaining the quality of its products through preventing counterfeit products from flooding the United States market. While being forced to litigate in the United States will obviously inconvenience Defendant and its witnesses, nevertheless, as Plaintiffs point out, Defendant is a sophisticated on-line merchant on the E-Bay platform which operates in the English language, and by choosing to sell in the United States and Illinois via internet forums could easily foresee being hauled into court here. Jos. Armando Bermudez & Co. v. Bermudez Int''1r Inc., 2000 U.S. Lexis 12354, *17 (S.D.N.Y. 2000). The U.S. trademark laws are primarily consumer protection laws so the United States and the State of Illinois have a stronger interest in seeing that their citizens have the protection of these laws than a foreign jurisdiction might have. Moreover, a United States court is certainly better able to understand the complexities of U.S. trademark law. Piper Aircraft v. Reyno, 454 U.S. 235, 241 n.6 (1981).

         Therefore, since the public and private factors favor retaining the case here, the Motion to Dismiss for Forum Non Conveniens is denied.

         B. Defendant's Motion to Strike the Lewis Affidavit

         Plaintiffs' Motion for Summary Judgment is straightforward: it owns the Oakley trademarks which are registered with the U.S. Patent and Trademark Office ("PTO") and are thus incontestable. Defendant does not dispute this and further admits that it does not possess a license from Plaintiffs to sell its eyeware and is not an authorized retail dealer of Oakley products. The Plaintiffs' evidence of counterfeiting consisted of the submission of certain screenshots of Defendant's website on EBay in which Defendant offered for sale certain sunglass products that contained the Oakley trademarks on certain of the product accouterments, namely the eyeware lens and bag.

         Defendant seeks to prevent summary judgment by moving to strike the screenshot evidence submitted by Plaintiffs on the ground that the screenshots had not been properly authenticated. Its argument is that the affiant who testified about the screenshots, Erin Lewis, Plaintiffs' Manager of Global Online Intellectual Property Protection, could not properly authenticate the screenshots. It cites as authority United States v. Vayner, F.3d 125, 131 (2nd Cir. 2014). In this case, the government attempted to introduce a Facebook page that was purported to be defendant's, and contained an alias that was alleged to be used by the defendant. The court ruled that it had not been properly ...


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