Mediation may save the day in big brand trademark infringement case

Mediation may save the day in big brand trademark infringement case

Gucci, Yves Saint Laurent and other luxury brands suing Alibaba Group Holding Ltd for promoting the sale of counterfeit goods have agreed to mediation, deciding against a threat to withdraw from the process after Alibaba founder Jack Ma said that he would rather lose the case than settle.

The trademark owners agreed to the judge’s request that they try to resolve their differences through a mediator. They had accused the world's largest online retailer of trademark infringement for letting 31 companies sell counterfeit products and therefore damaging their sales and reputation.

One example was a fake "high quality leather" tote bag offered for $2 to $5 that closely resembled a real Gucci bag costing $795. The lawsuit sought a halt to counterfeit sales.

One of the lawyers said it was a "test case" that could change the behaviour of Alibaba toward "tens of thousands" of sellers of alleged counterfeit products on its platforms. An Alibaba spokesman said the company welcomed the trademark owners' decision to "pursue good faith mediation as a constructive means of exploring a path of cooperation - rather than litigation - in the fight against counterfeiting".

The case is Gucci America Inc et al v. Alibaba Group Holdings Ltd et al, U.S. District Court, Southern District of New York, No. 15-03784.

Jane@trademarkroom.com

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