Zara sues Thilikó for passing off products and photos as its own
Maintains it suffered substantial monetary damages and irreparable and unquantifiable harm to its reputation and goodwill
Zara, and its parent company Inditex, have accused the Los Angeles-based fashion brand Thilikó LLC of engaging in a scheme of copyright infringement, false advertising, unfair competition, and deceptive trade acts.
In the complaint filed in a federal court in New York, Zara and Inditex said that Thilikó was misleading the consumers about the source and nature of their apparel and accessories. They alleged that the company and its owner Queenie Williams (the defendants) built a business by passing off Zara's fast fashion wares as their own.
The complainants added that Thilikó was acquiring Zara's garments, removing the tags, and replacing them with the Thilikó name. The goods, complete with "exorbitant mark-ups" were then sold as its own. To "capitalize on Zara's intellectual property," Thilikó marketed "misbranded and mislabeled [Zara] products." These included women's suit trousers and slip dresses to the "unsuspecting public" as "original Thilikó products."
They claimed, "Thilikó's advertising, marketing, and product labels have conveyed that the misbranded [Zara] products are designed, created, and/or manufactured by Thilikó."
In addition, the plaintiffs asserted that the two-year-old brand, which sells apparel and accessories through its own e-commerce site and other retailers, including Wolf & Badger, aimed to "dupe the public" by offering the misbranded products "at exorbitant prices, far beyond those consumers would pay for a Zara product."
Zara and Inditex further maintained that the defendants had systematically taken the copyrighted photographs that appear on Zara's website. They misused the same to advertise and sell the misbranded products. Inditex also asserted that while it was the rightful owner of those images, Thilikó routinely misrepresented the copyrighted photographs as proprietary property.
Zara is considered as one of the biggest players in retail by translating other brands' high-end designs into mass-market wares. Meanwhile, Inditex claimed that Thilikó violated the terms of Zara's e-commerce site, which prohibited the use, reproduction, modification, etc., of any material from the site without their authorization.
Besides, Thilikó was engaging in additional false advertising by holding itself out as an independent fashion brand and the creator and craftsman-like maker of the fashion designs in its collections. The plaintiffs contended that despite Thilikó representing itself as "a socially responsible" fashion brand that focuses on craftsmanship, detail, and fabric, a closer look revealed that "nothing could be farther from the truth,"
They claimed that Thilikó's "false and misleading statements concerned matters of primary and material importance to consumers: the source, manufacturer, and designer of the product and the social responsibility of the seller."
Zara and Inditex claimed copyright infringement and deceptive trade practices under the New York state law, and offenses against trademarks under New York Art & Cultural Affairs Law.
The latter stems from the defendants' alleged practice of "knowingly selling, offering to sell, and having in their possession with the intent to dispose of articles of merchandise with a label falsely indicating the persons manufacturing and/or producing the article."
Zara further stated that the defendant's conduct "is ongoing and undoubtedly encompasses additional acts of copyright infringement, unfair competition, passing off false advertising, and unfair and deceptive trade practices that have not been uncovered to date."
Zara and Inditex alleged that as a result of the wrongdoing, they "suffered substantial monetary damages, as well as irreparable and unquantifiable harm to Zara's reputation and goodwill.
They sought monetary damages and injunctive relief to bar Thilikó from infringing their copyrighted photos, and offering, advertising, or promoting any product or service making false or misleading representations or descriptions of fact, in any medium, regarding Zara products.
While reiterating that Thilikó acquired its wares from them and removed Zara-branded tags, the complainants said that it also did not rule out that the defendants could be acquiring the products from third-party manufacturers, who were copying Zara's wares and/or quietly getting them from Zara's network of supplier factories.