Chrome Hearts Sues Sellers | Counterfeit Claims

The luxury brand Chrome Hearts has filed a trademark infringement lawsuit! This happened so recently, the Defendants in the case may not even know of the suit. Who are the Defendants? Online sellers based in China and other locations around the world. What should these sellers do now? Respond! Without a doubt, if you are one of the sellers, you should respond to the Chrome Hearts lawsuit. What’s the reason for this? You’ll likely want to keep more of your money as opposed to less. 

What happens in these kinds of lawsuits is that after the case is filed a temporary restraining order (TRO) goes into effect. The TRO specifically targets the money in sellers’ accounts related to the sale of Chrome Hearts products. Did you sell Chrome Hearts goods to consumers in the United States? That’s probably why you’ve been named in the lawsuit. As such, you’ll want to respond to the court because if you don’t the money stuck in your account will be awarded to the brand. That’s without question! Any Defendants who walk away automatically forfeit the TRO-frozen money in their account. 

Temporary Restraining Order | Responding to the Court

Many sellers in this exact predicament are curious if they should take legal action in return. That’s usually a beneficial strategy. Yes, it will cost money. And, yes, it will take your time. However, with the right intellectual property attorney on your side, you’ll have a much better chance of hanging onto the money you’ve earned. Respond, retain legal counsel, take legal action, keep your money, and get back to selling products online! 

When reading through the complaint that details Chrome Hearts’ claims, you’ll see that they’re saying the sellers sold counterfeit goods. These unauthorized sellers offered consumers products that are trademark infringing, says Chrome Hearts. Take a gander at any of the other complaints tied to the many other infringement cases we’ve written about before, and you’ll notice that much of the language is the same. Very interesting! This is because there’s an ongoing trend in the world of trademark infringement called “Schedule A” lawsuits. This kind of suit gives brands like Chrome Hearts the power to claim an exhausting list of Defendants all engaged in trademark infringement.

The Templated Nature of Schedule A Lawsuits

You can see familiar (templated) phrases and sentences in the complaint, like the following:

• “Third party service providers like those used by Defendants do not adequately subject new sellers to verification and confirmation of their identities, allowing counterfeiters to ‘routinely use false or inaccurate names and addresses when registering with these e-commerce platforms.’”
• “Defendants facilitate sales by designing the e-commerce stores operating under the Seller Aliases so that they appear to unknowing consumers to be authorized online retailers, outlet stores, or wholesalers.”
• “E-commerce store operators like Defendants are in constant communication with each other and regularly participate in QQ.com chat rooms and through websites such as sellerdefense.cn and kuajingvs.com regarding tactics for operating multiple accounts.”
• “Defendants reside and/or operate in the People’s Republic of China or other foreign jurisdictions with lax trademark enforcement systems or redistribute products from the same or similar sources in those locations.” 

This is just a small selection of the templated language we frequently see in these Schedule A cases. The alleged counterfeit activity occurred on Walmart, Amazon, Temu, Etsy, eBay, and other platforms. All in all, Chrome Hearts is attempted to combat what they believe is trademark infringement because it is hurting their business. Have the named Defendants actually done any or all of what this lawsuit claims? Each and every seller’s individual business practices vary. That’s why you should especially seek the help of an attorney to figure out why in fact you’ve been accused of counterfeiting. 

Do I Have Other Options Aside from Reaching a Settlement?

In many instances, sellers who are hit with a restraining order and accused of counterfeiting want to settle with the brand. Sure, you can reach a settlement with Chrome Hearts. But, you should know this! The majority of the settlements in Schedule A lawsuits hover at around 60% of the total amount of funds in the frozen account. While that may not seem that bad, you don’t have to accept that kind of dramatic loss. You have more legal options available to you, if you pursue them. Much of these settlements are made because sellers are intimidated. Or, the Defendants don’t believe it’s worth spending money and time on finding a resolution. If you can afford it, take action! You deserve to clear yourself of any claims of counterfeit, if possible, and maintain a hold on your hard-earned money. 

Struggling with a counterfeit lawsuit? Contact Stockman & Poropat, PLLC today! Our team is ready, willing, and able to offer you the help you may need. We offer a free consultation! Let’s figure out the way forward together. 

Download the legal complaint below: 

Up next we will be discussing the Toyota Trademark Infringement Lawsuit.