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Cleveland Golf?s Mystery Shopper Reveals Alleged Counterfeiters and Results in IP Infringement Lawsuit

By David Dawsey PE Esq

Cleveland Golf sure seems to do a good job monitoring online sales of their products to ensure they are real Cleveland clubs sold in an authorized manner. You may recall a previous post titled ?Cleveland Golf Cracks Down on Unauthorized Online Sales.? Yesterday Cleveland continued to demonstrate their market awareness and filed a lawsuit against the operators of the website ?CopyCatClubs? for allegedly selling a counterfeit Cleveland® HiBore® driver, Cleveland® CG14® Black Pearl wedge, Cleveland® CG10® wedge, Cleveland® CG12® wedge, and Cleveland® 588® wedge to one of Cleveland Golf?s ?mystery shoppers.? What a job! How do you get a ?mystery shopper? gig?

I have included some of the more interesting parts of the Complaint below.

B.    Defendants' Sale of Counterfeit Golf Clubs

    18.    Defendants operate and are the registrants of the domain names copycatclubs.com, worldtimegolf.com, legacygolfclubs.com, and myscrubs4u.com (hereinafter, the "Websites"). The Websites each resolve to an online store advertising and offering the "newest clubs from brands such as: Callaway golf, Ping golf, Nike golf, Taylor Made golf, Titleist golf, Cobra golf, Mizuno golf, Cleveland golf, Yes and Odyssey putters... Along with our exceptional customer service, we are your one stop shop for the best COPIED and ORIGINAL golf equipment on the internet." See screenshot of Websites' home page attached hereto as Exh. A.
    19.    To lure additional Internet traffic to the Websites from search engine results, the Defendants have used the federally registered trademark, CLEVELAND® in metadata embedded within the Websites.
    20.    The Websites also offer a dropshipping service whereby the Defendants offer to fulfill golf clubs orders placed at other online stores. See screenshot of Websites' dropshipping offer attached hereto as Exh. B.
    22.    To protect its trademarks and to ensure that consumers are getting authentic Cleveland Golf products, Cleveland Golf hires a Mystery Shopper to purchase its products from a variety of sources in the marketplace.
    23.    In 2009, at the direction of Cleveland Golf, a Mystery Shopper made a purchase of a Cleveland® HiBore® driver, a Cleveland® CG14® Black Pearl wedge, a Cleveland® CG10® wedge, a Cleveland® CG12® wedge, and a Cleveland® 588® wedge from copycatclubs.com.
    24.    The Mystery Shopper sent payment to Defendant Sheldon Shelley's PayPal account, which listed an address of 2427 Scholar Lane, North Charleston, South Carolina, 29406. PayPal's transaction records indicate that Defendants' email address is <redacted>.
    25.    The Mystery Shopper received the Cleveland® HiBore® driver, Cleveland® CG14® Black Pearl wedge, Cleveland® CG10® wedge, Cleveland® CG12® wedge, and Cleveland® 588® wedge via an EMS (a worldwide air freight service) package. According to the box the clubs came within, the clubs were shipped to the Mystery Shopper directly from China.
    26.    Cleveland Golf has determined that the golf clubs received by the Mystery Shopper from the Defendants were counterfeit. The sale by Defendants of counterfeit Cleveland Golf products to the Mystery Shopper is a violation of Federal trademark law.
    27.    The Defendants in this action have knowingly sold counterfeit Cleveland Golf branded golf clubs to unsuspecting consumers.

C.    The Likelihood of Confusion and Injury Caused by Defendants' Actions

    28.    Counterfeit Cleveland Golf clubs are not the same or of the same quality as those manufactured and sold by Cleveland Golf under the Cleveland Marks. As such, consumers who purchase counterfeit golf clubs bearing the Cleveland Marks are likely to be confused and/or disappointed by obtaining counterfeit golf clubs when they intended to purchase genuine Cleveland Golf clubs. In addition, the sale of counterfeit Cleveland Golf clubs is likely to cause confusion among consumers regarding Cleveland Golf's sponsorship or approval of the counterfeit clubs. As a result of Defendants' actions, Cleveland Golf is suffering a loss of the enormous goodwill Cleveland Golf has created in its Cleveland Marks and is losing profits from lost sales of genuine product.
    29.    Defendants are likely to continue to commit the acts complained of herein, and unless restrained and enjoined, will continue to do so, all to Cleveland Golf's irreparable harm.
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WHEREFORE, the Plaintiff, Cleveland Golf, requests that this Honorable Court:
   
    1.    Enter judgment in favor of the Plaintiff, Cleveland Golf, against the Defendants Christopher Prince, Sheldon Shelley, and Prince Distribution, LLC, on all Counts and account for and pay over to Cleveland Golf all of Defendants' profits derived from its unlawful conduct, to the full extent provided for by Section 3 5(a) of the Lanham Act, 15 U.S.C. § 1117(a), including treble damages where appropriate, or as an the alternative to profits, $2,000,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed by Defendants as provided for by 15 U.S.C. § 1117(c);
    2.    Enter a permanent injunction restraining and enjoining Defendants and their divisions, subsidiaries, officers, agents, employees, attorneys, and all those persons in active concert or participation with them who receive actual notice of the order by personal service or otherwise, from (i) purchasing, distributing, selling, or offering for sale, counterfeit Cleveland Golf clubs, or assisting, aiding, or abetting any other person or entity in doing so; or (ii) using the Cleveland Marks or marks confusingly similar to the Cleveland Marks in connection with the sale of golf clubs or golf related equipment;
    3.    Award punitive and exemplary damages against Defendants in favor of Plaintiff by reason of Defendants' intentional or reckless disregard for Plaintiff's rights and the rights of those defrauded;
    4.    Award treble damages pursuant to S.C. Code Ann. § 3 9-5-140;
    5.    Award the Plaintiff its reasonable attorneys' fees and costs;
    6.    Award the Plaintiff pre-judgment and post-judgment interest in the maximum amount allowed under the law; and
    7.    Award such other and further relief as it deems just and reasonable.

 
Interesting! The actual Complaint may be viewed in its entirety HERE.
David Dawsey  ? Keeping an Eye on Golf Trademark Lawsuits

PS ? click HERE to read more posts about intellectual property litigation in the golf industry

Full post as published by Golf Patents on August 13, 2009 (boomark / email).