Coach Sues the City of Chicago! Posted at 5/24/2010 06:16:00 PM 0 comments (+) Coach Inc., a maker of luxury leather handbags and wallets, sued the city of Chicago for allegedly sustaining a street market where counterfeit goods are sold.

The city failed to halt the sales at its New Maxwell Street Market on Chicago’s West Side after being told about them by the company, according to a complaint filed yesterday in U.S. District Court in Chicago.

“Defendants are well aware of the extraordinary fame and strength of the Coach brand, the Coach trademarks, the Coach trade dresses and the Coach design elements and the incalculable good will associated therewith,” the complaint said.

Chicago is the third largest U.S. city, with a population of about 2.8 million people. The Maxwell Street market has roots in 19th century Chicago and features nearly 400 sellers of food and merchandise, according to the city’s website.

The city charges vendors $50 for a license to sell goods at the year-round site.

Melissa Stratton, a spokeswoman for the city, said its lawyers had not yet seen the complaint and that she couldn’t immediately comment on the allegations.

Company investigators have bought fake handbags bearing the company’s trademarked logos from vendors there for as much as $27 this year, according to the complaint. Authentic Coach handbags retail for $200 to $600, according to prices appearing on the Macys Inc. website.

‘Recall’ Demand

The New York-based leather goods maker is seeking statutory damages of $2 million for each counterfeit item and mark, as well as a court order directing the city to “recall” and deliver to Coach all of the offending items. Coach’s annual sales exceed $3 billion, Coach’s lawyers say in the complaint.

Two Maxwell Street merchants were arrested last year, following a Coach investigator’s canvass of goods for sale there, the company said in its complaint.

Those sellers, together with up to 100 unnamed “John Does,” were also named as defendants in the Coach suit.

In December, it sent the city a cease and desist notice, “to compel its cooperation in ending the infringing conduct.” Chicago never responded, according to the filing.

The case is Coach Inc. v. City of Chicago, 10cv3108, in the Northern District of Illinois (Chicago).

To contact the reporter on this story: Andrew M. Harris in Chicago at aharris16@bloomberg.net

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