Chanel v. What Goes Around Comes Around (WGACA)
🍿 The most important lawsuit of the year is headed to trial today in a couple hours. The case is important for the future or the resale market that we all know and love. The case of Chanel v. What Goes Around Comes Around (WGACA)
will head to a jury trial today, after the two sides have been battling for almost five years.
Chanel filed the case in New York federal court in March 2018. Chanel claimed that the resale company was trying to “deceive consumers into falsely believing that there is an affiliation between the two, or that Chanel has authenticated the items that WGACA is reselling. They also alleged that WGACA is offering and selling counterfeit handbags and/or infringing products. Chanel also alleged that WGACA improperly used Chanel trademark logos in ad campaigns and on social media posts and hashtags (such as #WGACACHANEL). Chale's damages expert, Andrew Safir, has claimed that Chanel suffered damages of more than $23.2 million from WGACA's alleged infringement and actions here.
WGACA claims that they have sold “hundreds of thousands of products without ever selling a counterfeit.” They also claim that they only used Chanel's trademarks descriptively, to identify their products and do not claim to have any affiliation or sponsorship by Chanel.
The Judge isn't all on the Chanel bandwagon. He did deny Chanel's motion to force WGACA to produce advertisements and online product listings of Chanel items.
The main issue the jury will have to decide is if WGACA's use of Chanel marks constitutes fair use because WGACA allegedly only uses Chanel trademarks to identify goods that WGACA is lawfully permitted to sell. WGACA will likely discuss the rise of the luxury resale market that we all are aware of, touching on the fact that Chanel’s sales and profits have continued to grow in recent years, and that the growth in the resale market actually helps Chanel and other brands (LV, Goyard, Hermes..etc) justify their high prices and that consumers can purchase these as investments.
Get your popcorn ready, this should be interesting and will certainly have an impact on the resale market and how resellers/ resale companies sell second hand products legally.