Coach Triumphs in Defamation Lawsuit Filed by Alleged Counterfeit Seller

Coach, Inc. came out on top this past week in a defamation lawsuit filed against it by an online retailer of allegedly authentic designer bags. In her lawsuit against Coach, which was filed in April 2016 in the United States District Court for the Southern District of Ohio Western Division, Brenda Buschle – owner of e-commerce site Designer Handbags Rescue – claimed that Coach defamed her by naming her in a “baseless” lawsuit of its own, allegedly charging her with selling counterfeit goods and then wrongfully seizing control of the operations of her website.

Buschle claims that Coach initially filed suit against her in April 2015, alleging that she was an “online counterfeiter” who resides in “the People’s Republic of China or other jurisdictions” that has “sold, offered to sell, marketed, distributed, and advertised, and are still selling, offering to sell, marketing, distributing, and advertising products bearing counterfeit reproductions of the COACH Trademarks without Coach’s permission.” (She established in her own lawsuit that she, in fact, resides in and runs her website from Ohio. She further stated that her personal address is listed on her site).

Shortly after Coach filed suit, it filed an additional ex parte motion for entry of a temporary restraining order. The motion included an ex parte order to seize control of Buschle’s website, which the U.S. District Court for the Northern District Court of Illinois granted, thereby enabling law enforcement to shut down her site. As a result, her e-commerce site was replaced with pages that included statements, such as, “WARNING: Website shut down! The online store that formerly used this domain has been disabled … For the sale of products bearing counterfeit trademarks” and “to purchase authentic products, visit Coach.com” among others.

Shortly thereafter, Buschle filed a lawsuit of her own, claiming that her website “remained shut down and the false and defamatory statements remained on the website for more than 24 hours,” thereby not only preventing her from accessing her site, but resulting in “all of her existing and potential customers visiting the website [and seeing] the defamatory statements on the website.”

Buschle’s complaint went on to state that she does not offer counterfeit goods for sale on her site. Instead, she offers genuine goods as a result of her “contracts with numerous authorized merchants, including liquidators and national department stores, to purchase overstock, closeouts, shelf pulls, display bags and even bulk-lot customer returns.” She further noted that she “only purchase[s] from vendors in the USA.”

Despite Buschle’s claims that Coach’s “illegal actions” have destroyed “Designer Handbags Rescue’s reputation for selling genuine and authentic designer handbags at a good price,” Coach was handed a victory this past week thanks to something of a technicality. Judge Michael R. Barrett dismissed the case, holding that Ohio’s federal district does not have proper jurisdiction to hear the case. In other words, the Ohio federal court was not the proper venue where the case should have been filed.

Judge Barrett held that the mere fact that Buschle lives in Cincinnati and therefore, ran her website from that location, was not enough to establish that the venue was proper. According to his decision, Barrett held that Coach is based in New York, and “Ohio was not the focal point of the information [Coach] posted on [Buschle’s website].”

He further stated: “In fact, [Buschle] has not indicated that any of the visitors to the website during the approximately 28 hours the website was seized were from Ohio.” As a result, he has dismissed the case and Buschle may now refile in New York if she would like to. More to come …