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Beats Sues Chinese Counterfeit Seller for Billions of Dollars
Headset manufacturer Beats filed a lawsuit against a number of Chinese counterfeit sellers, accusing them of trademark infringement and demanding compensation, which can amount to billions of dollars. S. Court for the Northern District of Illinois will hear the case. at the end of may this year,AppleAnnounced the acquisition of Beats for $3 billion, the deal is expected to close in a few weeks, when Beats will officially become an Apple subsidiary.
"The legal action launched by Beats is aimed at cracking down on counterfeiters selling online, who have stolen Beats' business reputation and sold or offered unauthorized, counterfeit products bearing Beats trademarks." "These defendants created hundreds, if not thousands, of fake Internet stores designed to sell genuine Beats products, when in fact they sold inferior quality fake Beats products to uninformed consumers," the lawsuit documents said."
Beats lawyers said that these counterfeit sellers have mature business practices that can maximize profits while minimizing the possibility of being discovered by law enforcement agencies. They will ship counterfeit Beats products in small quantities through international express delivery, while disguising the true quality of the goods and reducing the risk of detection by U.S. customs and border inspection agencies. Beats estimates that the counterfeit sales sites the company is suing could total more than $135 billion a year.
In addition to requesting an import ban and a sales ban, Beats also asked the court to confiscate the profits from these counterfeit Beats headphones. This figure is almost impossible to calculate accurately, but it may reach billions of dollars. Beats is also seeking $2 million for each infringement case and $100000 for each domain name that sells such counterfeit goods. At the same time, Beats asked the Internet domain name registration company to take back the infringing domain names and hand them over to Beats.
It is not clear what Beats can get out of the lawsuit, because these compensation claims, even if granted by the court, cannot be truly compensated. The company launched a similar lawsuit in 2013, resulting in the forfeiture of 1472 domain names, 50 PayPal accounts, and 14 "online sales accounts".