Federal judge denies WWE’s bid to seize counterfeit goods

Judge Helen Ginger Berrigan
Judge Helen Ginger Berrigan

A federal judge in New Orleans this week delivered a smackdown to World Wrestling Entertainment, rejecting the company’s request to allow its personnel to confiscate alleged bootleg goods sold at events surrounding this weekend’s WrestleMania XXX without having to identify ahead of time who exactly is selling the fraudulent items.

Attorneys for WWE filed the preemptive complaint March 26 against “John and Jane Does and XYZ Corporations, whose precise identities are not yet known to WWE.” The company asked for an order to allow it to seize counterfeit marked goods so as to bar the unnamed defendants from infringing on WWE’s intellectual property rights.

Although WWE’s attorneys cited examples of other judges across the country who they said granted similar relief, U.S. District Judge Ginger Berrigan denied the request. Berrigan wrote that while she had “little trouble” believing the company was correct in predicting that counterfeit goods would be sold around the Mercedes-Benz Superdome, she still found the request to be “an extraordinary form of relief.”

Knockoff merchandise, sold at a discount compared with officially licensed goods outside major sports events, has turned into a lucrative business for vendors. That’s especially true in New Orleans, law enforcement authorities say, because the city has hosted a series of big-ticket events in recent years.

When the city hosted Super Bowl XLVII in 2013, officials with U.S. Immigration and Customs Enforcement set their sights on international shipments of counterfeit merchandise, seizing more than $13.6 million in bootleg NFL merchandise. All told, ICE confiscated more than 160,000 items, including fake jerseys, ball caps, T-shirts and jackets.

During WrestleMania XXVIII in Miami in 2012, the event averaged $18 worth of legitimate merchandise sales to each ticket holder, WWE’s court filing said. Overall, the company brought in $18.3 million on merchandise sales at its live events in 2013.

In the past, federal judges across the country have been receptive to WWE’s requests to allow it to directly seize counterfeit goods. Ahead of WrestleMania XXVII in Atlanta in 2011, a judge gave this permission and the company seized 3,000 T-shirts that were being sold for $10 apiece, WWE said.

When WWE is given such authority, the federal court later holds a hearing to allow venders to reclaim their property if they can show it was legitimate. Vendors rarely jump at those opportunities, WWE contended in its filing. Without permission to seize goods, WWE officials must appeal to law enforcement to intervene if they spot bogus products.

Ashlye Keaton, an adjunct lecturer in the Tulane University Law School who specializes in entertainment and intellectual property law, said granting the motion could have created a ripple effect.

“There are all kinds of conventions that come into town. We are a tourism-breeding ground, and you know, if they were successful in that motion, just imagine the size of the can of worms that would open for anyone else coming down here,” Keaton said. “Everybody would be filing their motions in advance.”

WWE contends that the bootlegged goods are typically of “inferior quality.”

“There is no way to know the quality of the counterfeit goods, such as the flammability level of the ink used to print the T-shirts and the safety of the design of other goods, such as wrestling masks, that previously have been seized,” WWE’s New Orleans lawyers, Emily Lippold Gordy and Raymond Areaux, wrote in the court filing.

Berrigan, in her 13-page order, found that “without knowing who (and not even necessarily a name but some information about) ‘the person against whom seizure would be ordered,’ the court cannot possibly evaluate” whether the request meets certain judicial benchmarks.

The request, she said, “puts the cart before the horse” because it requires alleged bootleggers “to identify themselves or lose their goods.”

After the initial denial, WWE filed for a motion for reconsideration Wednesday, which Berrigan also denied.