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Judgment Granted after Summary Trial for Recidivist Sale of Counterfeits

October 2, 2015

By Adam Bobker and Janice Calzavara

Chanel S de R.L., et al. v Lam Chan Kee Company Ltd., et al. 2015 FC 1091, is a case involving counterfeit CHANEL® goods. Justice Martineau of the Federal Court heard a summary trial (based only on affidavits and out of court cross-examinations) and granted judgement for an injunction and damages totalling $380,000, including $64,000 in nominal damages, $250,000 in punitive and exemplary damages, and $66,000 in costs. There was evidence of infringement over a period of years and past claims and consent orders against the business. Personal liability was found on the part of one of the personal defendants on the basis that she aided and abetted, authorized and sanctioned the infringements, as well as was the owner of the premises from which the retail sales of the counterfeit goods were taking place.

The two corporate defendants filed no defences and the personal defendants (a husband and wife) had argued that a full trial with live witnesses was required. Their company had been accused of infringing CHANEL® properties in the past and settled and consented to orders prohibiting further infringements. But, they argued that they had since sold the business to their children and any further infringements were not their responsibility. Without live testimony, the Court was prepared to dispense with this defence. Given the recidivist behaviour, on the facts (only a fraction of the alleged purchase price had been paid, and the alleged sale was not reported to the government until after the litigation commenced) there were no credibility issues requiring a full trial. As there was evidence the wife continued to be involved in the retail business the entire time, she was found personally liable as owner of the premises.

This is another case in which the Federal Court was prepared to give a hard look at evidence raised in defence of summary proceedings for the sale of counterfeit luxury goods, and to find significant personal liability on the part of those responsible, including significant punitive damages.

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Adam Bobker Adam Bobker
B.Sc. (Elec. Eng.), LL.B.
416.957.1681  email Adam Bobker