Friday, July 29, 2011

Native American organization has constitutional standing against competitor

Native American Arts, Inc. v. Bud K Worldwide, Inc., 2011 WL 2692962 (M.D. Ga.)

Plaintiff NAA is an Indian-owned arts and crafts organization composed of members of the Ho-Chunk Nation. It makes Indian-made products, including tomahawks, knives, belts, blankets, and artwork. Bud K operates an online and mail order catalog store selling cutlery, knives, swords, and other Indian-style merchandise. NAA sued for violation of the Indian Arts and Crafts Enforcement Act of 2000 (“IACEA”), alleging that Bud K goods in a manner that falsely suggested that they were Indian produced, Indian products, or the products of a particular Indian tribe or Indian arts and crafts organization.

Bud K argued that NAA lacked constitutional or prudential standing. The court first found that NAA had prudential standing, then assessed constitutional standing, treating this as a factual question. The court held an evidentiary hearing.

Constitutional standing requires (1) injury in fact—an invasion of a legally protected interest which is concrete and particularized, and actual or imminent; (2) a causal connection between the injury and the conduct complained of; and (3) a likelihood that the injury will be redressed by a favorable decision.

NAA argued that the IACEA gave it standing, because Indian arts and crafts organizations are explicitly included as a person who may initiate a civil action under the statute. But that’s not sufficient to provide constitutional standing.

However, NAA met its burden. Its witness testified that, as a result of Bud K’s offer of fake Indian goods, NAA had to lower its prices on certain items, including knives, tomahawks, and blankets, about 25 or 30 percent. He also testified to lost sales and sales opportunities because of Bud K’s conduct. This was enough to show an actual injury fairly traceable to Bud K's alleged misconduct, and if its requested relief of damages and an injunction were granted its injury would be redresssed.

Bud K argued that NAA didn’t provide sufficient evidence of standing in the form of sales journals, balance sheets, profit and loss statements, or tax records. “The Court does not believe that for purposes of a Rule 12(b)(1) motion, NAA was in effect required to prove its damages or try its entire case.”

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