Court Allows Cloverleaf on WWE Counterfeiters

NEW ORLEANS (CN) - World Wrestling Entertainment can seize counterfeit merchandise sold outside live wrestling events, the 5th Circuit ruled.

Though a federal judge had denied WWE relief against "fly-by-night" counterfeiters selling unauthorized products, a three-judge panel of the 5th Circuit found Tuesday that an ex-parte seizure and temporary restraining order are available to it under the Trademark Counterfeiting Act.

These counterfeiters set up shop alongside wrestling fans as they line up outside live WWE events across the country, "cannibalizing WWE's merchandise sales by purveying unauthorized products," according to the ruling's summary of WWE's case.

"As the District Court acknowledged, WWE faces a real threat from such counterfeiters who, upon detection and notice of suit, disappear without a trace and hide or destroy evidence, only to reappear later at the next WWE event down the road,'" the unsigned appellate decision states. "This is the very nature of the 'fly-by-night' bootlegging industry."

The lower court nevertheless denied WWE relief based on the inability to provide specific details about the identities of the bootleggers that the seizure order would target. Indeed, WWE listed the defendants in the case as "unidentified parties."

In vacating that decision, the appellate panel emphasized that WWE "can readily identify the unauthorized designs of counterfeit merchandise" because it makes its own merchandise sales directly, rather than licensing third parties to sell the gear.

"The resulting confined universe of authorized sellers of WWE merchandise necessarily 'identifies' any non-WWE seller as a counterfeiter," the ruling continues.

"In this case, therefore, the 'person(s) against whom seizure would be ordered' are readily identifiable as any non-affiliated person purporting to sell WWE merchandise at or near a live WWE event," the judges added.

They said the WWE met its burden of proof for seizure orders.

WWE racked in $508 million in 2013, according to the company's fourth quarter earnings report, in part through merchandise sales bearing the WWE trademark.

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