Major Brand Sues CHB as Atty-in-Fact Entry Filer of Counterfeit Shoes
Nike, Inc. has sued a Customs broker for its role as the "attorney-in-fact" entry filer for the importation of counterfeit branded footwear. Nike seeks preliminary and permanent injunctive relief from further infringement of Nike’s trademarks, as well as damages, costs, and attorney fees.
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Nike alleges that the Customs broker unlawfully engaged in the distribution and importation for sale of counterfeit footwear bearing exact copies or colorable duplications of Nike’s trademarks.
Nike states that the licensed customs broker filed entry with documents that were fraudulent, as they falsely identified MTC Marketing as the importer of record for 4,624 counterfeit pairs of Nike shoes and falsely described the counterfeit shoes as “ladies cotton woven pants.”
According to Nike, the broker was required to prove that it had a “sufficient interest” in the entry goods and had exercised “due diligence” in obtaining authority via a customs power of attorney from MTC. By filing the entry documents, Nike claims the broker deemed itself to have sufficient interest in the goods covered by the entry to be responsible for their importation.
However, Nike alleges there was a lack of due diligence. MTC had no relationship with the broker and never at any time authorized the broker to act on its behalf concerning the importation of goods. The broker’s sole knowledge concerning the entry was information it received via a phone call from an individual who identified himself as the Vice President of MTC. The individual’s phone number was a private landline, unconnected to MTC, and the individual had no relationship with MTC. The individual had signed a fraudulent customs power of attorney; the POA itself lacked both a notarization and/or corporate certificate attesting to the validity of the grant of power of attorney. Prior to making entry, the broker had also failed to make any contact with MTC to confirm the importation, Nike claims.
Nike also claims that the broker’s action in filing the entry documentation constituted the legal or proximate cause of the importation of counterfeit shoes, and that the broker was required to use “reasonable care” in determining the nature of the goods covered by the entry documents, to determine, among other things, whether the goods bore the trademarks of any U.S. company, before filing the entry documents with Customs.
In addition Nike charges that the broker had negligently attempted to enter the counterfeit shoes into the U.S. through the means of fraudulent entry documents that contained false statements of material fact.
Complaint, Nike, Inc. v. D.L. Bynum & Company available by emailing documents@brokerpower.com