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Salvatore Ferragamo Awarded $4.3M in Online Counterfeit Case

A Manhattan federal court also granted a permanent injunction.

Salvatore Ferragamo was awarded $4.3 million by a Manhattan federal court in connection with the luxury brand’s fight against counterfeiting.

The lawsuit was filed in January against 15 defendants who were holding a total of 95 domain names that infringed upon the Ferragamo trademark and sold counterfeit goods. Earlier this year, the Manhattan federal court overseeing the lawsuit had ordered the transfer of the domain names, such as FerragamoBagSale.com, FerragamoSingapore2012.com and FerragamoOnlineStore.com, to Ferragamo and had shut down the Web sites.

Ferruccio Ferragamo, chairman of the Salvatore Ferragamo Group, said, “Our company is committed to protecting our brand and contributing to the fight against counterfeiting, which for many years has beleaguered the world’s most prestigious fashion and luxury brands. The Internet has now become a leading channel for traffickers of counterfeit goods, and is now the central focus of the recent lawsuits filed by our group, historically one of the most affected by this crime.”

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The complaint — alleging trademark counterfeiting, trademark infringement and dilution and cybersquatting — indicated that the defendants were selling counterfeit products that included “handbags, wallets, belts, shoes, eyeglasses, sunglasses, shoes, scarves, watches and ready-to-wear clothing.”

A preliminary injunction was obtained in February, with a default judgment entered against all the defendants in June. The matter was then sent to U.S. Magistrate Judge Sarah Netburn in Manhattan for a hearing on the damages component of the lawsuit. Her report in November indicated recommendations that the preliminary injunction be converted to a permanent injunction and that the award of damages be in the amount of $4.3 million. The decision was served on all defendants on Dec. 3.

Salvatore Ferragamo SpA is the parent firm of Salvatore Ferragamo Group.

Ferragamo faces the same collection problem other brands have in their fight against counterfeiters. So far, an aggregate of $158.7 million has been awarded in 2013 to brand owners, including the latest win by Ferragamo.

Earlier this year, Tiffany won $2.2 million against a ring of Internet counterfeiters, Coach was awarded $8 million against a Customs brokerage firm and Gucci America Inc. won a hefty $144.2 million against several organizations engaged in online counterfeiting.

The real question is how much in damages can these brand owners reasonably expect to collect. Many defendants don’t bother to show up in court, and others change the name of their operations and then become hard to locate.