NEW YORK — Tommy Hilfiger Corp.’s subsidiary, Tommy Hilfiger Licensing Inc., has settled its trademark counterfeiting and infringement lawsuit against Goody’s Family Clothing Inc., with Goody’s agreeing to pay Tommy $11 million.
As reported, a federal district court in Atlanta ruled in May that the 330-unit Knoxville, Tenn.-based retailer sold counterfeit Tommy Hilfiger T-shirts, representing $2.1 million in damages, and infringed on Tommy’s Flag trademarks in connection with the retailer’s private label jeans line, which resulted in $8.9 million in damages. Goody’s subsequently said it would appeal the award.
Steve Gursky of Gursky & Ederer, Tommy’s attorney, said that the settlement, signed on Friday, waived whatever appeal rights Goody’s had and also requires an additional $1 million payment to cover legal costs incurred by Tommy. “The settlement is uncommon,” he said, “because it represents one of the few times in which a plaintiff in a counterfeiting suit gets to collect an award in full. Many times you hear of high awards, but they never get paid because the party responsible is a shell corporation.”
Tommy expects the $11 million pretax settlement to increase earnings a diluted share by 8 cents for the quarter ending June 30.
Joel Horowitz, chairman, chief executive officer and president of Tommy, said in a statement, “We are pleased with the terms and with the success of our efforts in this case to address the blatant counterfeiting and trademark infringement that was taking place. We will continue to be vigilant in protecting the value of the Tommy Hilfiger brand and vigorous in our pursuit of those who violate the law.”
Executives at Goody’s could not be reached for comment.