By Randall Holbrook, J.D.
BYD Global was granted a preliminary injunction against multiple individual defendants for distributing counterfeit BYD-branded N95 respirator masks—important tools in combatting COVID-19.
In a trademark infringement action, the federal district court in Los Angeles granted BYD Global’s unopposed motion for preliminary injunction to prevent individuals from distributing counterfeit N95 respirator masks, finding that the defendants had proper notice of the motion. BYD sufficiently alleged that the defendants had manufactured, marketed, and offered to sell masks that were falsely labeled with the "BYD" and "BYD Care" marks despite not undergoing the quality control and regulatory approval processes of the authentic masks produced by BYD (BYD Co. Ltd v. Khazai, July 10, 2020, Gee, D.).
The case concerned the manufacture and distribution of N95 respirator masks, important tools in combatting the COVID-19 pandemic. BYD’s respirator masks had secured certifications from agencies around the world, including the Federal Drug Administration and the National Institute for Occupational Safety and Health. In recent months BYD has received communications from customers who had purchased, or been offered, masks bearing BYD’s trademark by the defendants. The masks have been offered or sold in quantities much greater than the defendants could have obtained on the secondary market. In addition, none of the defendants were authorized distributors of BYD products. It was alleged that the masks offered for sale were counterfeit and not subject to the quality control and regulatory approval of BYD’s actual products.
Likelihood of success on the merits. BYD established likelihood of success on the merits. Its name and logo were registered trademarks, and the exact mark was used by defendants, not just a similar one. There also was evidence of actual confusion by customers of BYD who expected authentic masks and received counterfeit masks.
Irreparable harm. BYD showed that its loss of control over the supply of "BYD" branded respirator masks, including the sale of unapproved, potentially ineffective masks, would result in intangible harm to its business reputation, particularly given the exigencies of the COVID-19 crisis in the United States. This intangible harm to business reputation met the standard of irreparable harm.
Balance of equities. The court remarked that the defendant’s failure to respond made it difficult to balance the equities of this case; however, the illegality of defendant’s alleged conduct—not just infringing a trademark but also representing that their non-approved N95 masks had received FDA approval—did not merit significant equitable consideration.
Public interest. The court found that the public interest was strongly in favor of issuance of the preliminary injunction. Selling subpar masks during the existing global pandemic would put anyone who used such a mask, potentially including health care professionals, at greater risk of transmitting or being exposed to COVID-19.
Bond. Because the enjoined conduct was illegal the court declined to require a bond.
This case is No. 2:20-cv-05530-DMG-AGR.
Attorneys: Susan Kay Leader (Akin Gump Strauss Hauer & Feld LLP) for BYD Co Ltd and Global Healthcare Product Solutions, LLC.
Companies: BYD Co. Ltd; Global Healthcare Product Solutions, LLC
MainStory: TopStory Trademark CaliforniaNews GCNNews Covid19
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