Jewelers mostly successful against replica site

Yurman Studio, Inc. v. Castaneda, 2008 WL 3861219 (S.D.N.Y.)

A number of high-end jewelers asserted claims against defendant, who offers cheap replicas of their designs at overstockjeweler.com. Copyright, design patent, and trademark claims were all involved, along with false advertising and consumer fraud.

Plaintiffs succeeded on some copyright claims, while others were held inappropriate for summary resolution; likewise, they succeeded on a few of the trademark counterfeiting claims, while the rest of the trademark issues, including whether “Cartier-esque” and similar terms constituted nominative fair use, required resolution at trial. (The court suggested that the third prong of the nominative fair use test, whether defendants did anything else to suggest source or sponsorship, might require a full-scale confusion analysis. While there are certainly cases that suggest this, they ought to be rejected, given that after a full-scale confusion analysis there is nowhere else to go, and that nominative fair use was aimed at preventing precisely this kind of expensive and risky inquiry in order to preserve competition and free speech. Also, why would anyone believe that “-esque” indicates source or sponsorship? It indicates precisely the contrary: a replica, an imitation, not the real thing.) Also, the design patent claims survived summary judgment.

On false advertising, the court took another step in the seemingly inexorable expansion of standing as a bar to suit: though the parties both sell jewelry, the price points are so different that defendants don’t compete with plaintiffs. Two of the high-end jewelers testified that they didn’t regard plaintiffs as competitors, which was snobbish and, in this instance, counterproductive. As someone who’s spent $500 on a piece of jewelry and also $5, I am dubious about this holding, but maybe people who spend $50,000 on jewelry don’t slum.

Plaintiffs’ New York consumer fraud claims also failed for lack of consumer injury or harm to the public interest, since no one’s health or safety was at risk.