RUN-DMC Files $50 Million Trademark Lawsuit Against Amazon and Wal-Mart
On December 29, 2016, the famous rap group RUN-DMC filed a $50 million federal lawsuit against Amazon, Wal-Mart and several other defendants for trademark infringement, trademark dilution, unfair competition and related claims. The complaint alleges that the defendants engaged in advertising, selling, manufacturing, promoting and distributing numerous products with the RUN-DMC mark without the group’s permission, including glasses, hats, t-shirts, patches, wallets and other items. According to the complaint, the products infringe upon and utilize the RUN-DMC federal trademark and the defendants have engaged in their wrongful conduct for at least three (3) years.
The complaint states that since the 1980’s, the RUN-DMC brand has produced over $100 million in revenue from intellectual property related to the RUN-DMC mark, including music sales, music publishing, concerts, merchandising and endorsement deals. As further evidence of the mark’s notoriety, the complaint notes that RUN-DMC has entered into several licensing agreements, including a $1.6 million deal with Adidas for a line of sneakers.
The complaint doesn’t reference any contract between RUN-DMC and the defendants that might grant the defendants the right to sell the products at issue. Of course, the complaint was just filed and the defendants may indeed have legitimate defenses. It will be interesting to see what other facts come to light after the defendants respond to the complaint and the parties engage in discovery.
However, it would appear that numerous issues will be litigated in the case, including when Amazon, Wal-Mart and the other defendants first became aware of the alleged infringement, what actions they took in responding to the infringement claims and when, and whether the defendants complied with their own policies in this regard. The revenues earned by the defendants from selling the infringing products will no doubt be hotly contested. Another issue likely to be litigated is the specific due diligence procedures implemented by Amazon and Wal-Mart to reduce the likelihood of suppliers furnishing goods that infringe on registered trademarks. You can also expect Amazon to argue that it is impractical and expensive to police all products sold on its site and that holding it liable for infringement would significantly raise the cost for a service that has become essential for millions of users throughout the world.
The case is pending in the United States District Court for the Southern District of New York, Case No. 1:16-CV-10011-JPO. RUN-DMC is represented by the Boston firm of Brown & Rosen, LLC.
