NEW YORK — Coach Inc. has won an $8 million jury award in a counterfeiting case involving a customs brokerage firm.
The lawsuit was filed in a federal district court in Los Angeles and is believed to be the first verdict against a customs brokerage firm. Most importers hire customs brokerage firms to handle the paperwork required for the importation of goods.
This story first appeared in the April 15, 2013 issue of WWD. Subscribe Today.
Coach launched its investigation when U.S. Customs and Border Patrol advised that it had seized a large shipment of counterfeit Coach handbags and wallets headed for the Port of Los Angeles. With the aid of outside counsel, Samuel Watkins of Theodora Oringher PC, it was determined that the defendants created and filed fraudulent customs entry documents to allow the counterfeit product to be shipped to the U.S.
The trial of Coach Inc. et al v. Celco Customs Services Co. and Shen Huei Feng Wang lasted three days, after which the jury deliberated for a half day and rendered its verdict in favor of Coach, according to Nancy Axilrod, vice president and deputy general counsel for the accessories firm.
Axilrod said the case is believed to be a landmark because it is the first one in which someone has been able to obtain a verdict against a customs brokerage firm. Lawsuits against customs brokers are almost nonexistent. In this case the brokerage firm used identity theft — stealing the name of a company with a sterling record — to smuggle counterfeit goods into the U.S.
According to Axilrod, lawyers and support staff working on the case sorted through extensive paperwork to prove to the jury that “these customs brokers knowingly and willfully participated in this scheme.”
The latest victory reflects Coach’s commitment to “follow every lead and identify everyone who helps to facilitate the counterfeit trade,” Axilrod said.
The case is the most recent victory in Coach’s anticounterfeiting litigation campaign “Operation Turnlock.” So far the accessories firm has filed over 650 lawsuits and has received millions in judgments and settlements. Coach began the initiative in May 2009.