The 6th U.S. Circuit Court of Appeals ruled for the first time on the question of whether a flea market owner can be held liable for contributory trademark infringement. In the case of Coach Inc. v. Frederick Goodfellow, the operator of The Southwest Flea Market in Memphis, TN, the federal appeals court last week granted Coach a summary judgment stating that Goodfellow knew or should have known that some of the vendors at his flea market were selling counterfeit Coach products.
Back in 2010, Coach notified Goodfellow about the counterfeit Coach goods being sold at his flea market and then followed up with a lawsuit in June of that year. Local law enforcement had already, months earlier, seized counterfeit Coach products from the flea market.
In February 2012, a U.S. judge granted Coach summary judgment, ruling that Goodfellow was contributorily liable for the trademark infringement. A jury awarded $5.04 million in damages to Coach, plus more than $186,000 in attorney fees and litgation costs. Goodfellow appealed, but the 6th Circuit upheld the ruling last week.
In its ruling, the court said the flea market operator engaged in “ostrich-like behavior,” treating infringing activities with “knowledge and willful blindness.” The court’s decision relied on Inwood Laboratories Inc. v. Ives Laboratories, Inc. (1982), a U.S. Supreme Court case that set forth the standard for analyzing claims of contributory trademark liability. Coach had repeatedly notified Goodfellow about the counterfeit goods, so he knew or should have known about them, according to the court. You can read the appeal documents here.
The Southwest Flea Market was shut down by federal authorities in 2011.
Do you still see counterfeit goods being sold by flea markets or other vendors?