Online Sellers Sued for Trademark & Copyright Infringement | Squishmallows Federal Lawsuit

Sold any Squishmallows products online to consumers in the United States? That could explain why your business was named as a Defendant in a trademark and copyright infringement lawsuit. Kelly Toys, the owner of the Squishmallows trademark and copyright, is suing online sellers for counterfeiting and unlawful copying. You may be wondering what’s the first thing you should do? Reading through the legal complaint for the Squishmallows federal lawsuit is a good place to start! 

As a Defendant, you’ll want to fully comprehend the allegations made against you and your business. Once you’ve done that, you may want to seriously look into securing your own intellectual property attorney! Having a lawyer gives you the edge when dealing with the US legal system. That may be obvious to some. What isn’t the most obvious, however, is how much you’ll likely rely on your lawyer to negotiate with Kelly Toys. Lots of business owners have a staunch do-it-yourself attitude, which can be a benefit in many ways. In terms of legal issues, doing things yourself isn’t always the best choice. Is your aim to absolve yourself of the infringement allegations? Settle with the Plaintiff? An attorney will more than likely improve your outcome! 

The Squishmallows Federal Lawsuit | Schedule A, Temporary Restraining Orders

In trademark and copyright infringement cases, specifically Schedule A lawsuits such as this one, the Plaintiff usually seeks to implement a temporary restraining order (TRO). What does the restraining order do once approved by the court and put into place? The TRO prevents sellers from gaining access to their online accounts. Sellers are also prohibited from accessing the money in their accounts. This can make an e-commerce business very vulnerable! For sure, sellers don’t wish to go bankrupt. A TRO can push you closer to that possibility because of the imposition on your funds. To regain access to your selling accounts and sell products, you will have to respond to the lawsuit.

Any Defendant who fails to respond is basically handing over their money to Kelly Toys. The lawsuit is extremely serious! You’ll be able to avoid the forfeiture of your funds by responding to the court. Not to mention, you won’t have to face a Default Judgment. If you aren’t informed as to how you should respond, rest assured, an attorney can take care of that for you! 

Should You Settle Directly With The Plaintiff?

Yet another common trait of the Schedule A infringement lawsuit is settlements. The structure of the lawsuit gives Kelly Toys and big companies like it the ability to sue multiple online sellers at the same time. Their goal is to get compensated for the losses they absorbed due to the sale of counterfeit and copied products. Therefore, Kelly Toys may attempt to reach settlements with the sellers named in the suit. Sellers may see settlements as a quick and easy fix to the issue. While that can in some instances be true, sellers are overwhelmingly shortchanged whenever they settle directly with the Plaintiff. It has been reported that Defendants in Schedule A infringement lawsuits typically only get to maintain around 60% of their money if they settle with the Plaintiff. 

If you’re primarily interested in settling, do so with an attorney on your side! You may want to have your lawyer negotiate with Kelly Toys because they are more equipped to develop a resolution that is the most beneficial for you. In situations where the allegations of trademark and copyright infringement are without merit, your attorney can also work to prove that to the court. 

Hiring an Attorney Is Always Worth It!

Online sellers sometimes debate whether the cost of hiring an attorney to address the infringement suit is worth it. Given that the lawsuit has already put a financial burden on your business, weighing that option is reasonable. But taking it on yourself isn’t always the most practical approach. Lots of folks attempt to navigate the legal process on their own and then end up having to pay for a lawyer anyway to fix their mistakes. You’ll likely come out with the least amount of damage by investing a reasonable amount into an attorney now, rather than later. Remember, it’s the preservation of your own business that we’re talking about! 

What Are The Infringement Allegations?

Just what are the allegations Kelly Toys has outlined in reference to the Squishmallows intellectual property? Below, we will present a selection of the claims made against online sellers:

Defendants concurrently employ and benefit from substantially similar advertising and marketing strategies. For example, 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 stores operating under the Seller Aliases appear sophisticated and accept payment in U.S. dollars and/or funds from U.S. bank accounts via credit cards, Alipay, Amazon Pay, and/or PayPal. E-commerce stores operating under the Seller Aliases often include content and images that make it very difficult for consumers to distinguish such stores from an authorized retailer. 

Plaintiff has not licensed or authorized Defendants to use any of the SQUISHMALLOWS Trademarks or copy or distribute the Squishmallows Copyrighted Works, and none of the Defendants are authorized retailers of genuine Squishmallows Products.

Many Defendants also deceive unknowing consumers by using the SQUISHMALLOWS Trademarks without authorization within the content, text, and/or meta tags of their e-commerce stores to attract various search engines crawling the internet looking for websites relevant to consumer searches for Squishmallows Products. 

Other e-commerce stores operating under Seller Aliases omit using the SQUISHMALLOWS Trademarks in the item title to evade enforcement efforts while using strategic item titles and descriptions that will trigger their listings when consumers are searching for Squishmallows Products. 

Need a lawyer to help you with the Kelly Toys federal lawsuit? Contact our team at Stockman & Poropat, PLLC today! We offer a free initial consultation. 

Download the legal complaint below:

Up next we will be discussing the Ray-Ban, Oakley, and Costa Del Mar Trademark Lawsuit.