MEMORANDUM OPINION AND ORDER
Plaintiffs Chloe and Chloe, S.A. originally brought this action against defendants Queen Bee of Beverly Hills, LLC ("Queen Bee"), Sun-Eye Productions, Inc. ("Sun-Eye"), Rebecca Rushing, Simone Ubaldelli, Jennifer Suns, Mohammad Zarafshan a/k/a Alexander Zar, and John Does 2--20, alleging trademark infringement and false designation of origin under §§ 32(1) and 43(a)(1) of the Lanham Act, 15 U.S.C. §§ 1114(1) and 1125(a)(1), respectively. Chloe now moves for partial summary judgment on liability against defendant Simone Ubaldelli. For the reasons that follow, Chloe's motion is GRANTED.
For the purpose of this motion, the relevant parties are Chloe, S.A., Chloe, and Simone Ubaldelli.
Chloe, S.A., a French corporation with its principal place of business in Paris, is the owner of a trademark registration for the word mark CHLOE for handbags and other goods. (Copeman Decl. ¶ 1.) Chloe, a division of Delaware corporation Richemont North America, Inc. with its principal place of business in New York, is the exclusive U.S. licensee of the CHLOE trademark for all Chloe branded goods. (Id.) Plaintiffs operate a fashion company that sells women's clothing and accessories. (Id. ¶ 3.) In this opinion, "Chloe" refers to both Chloe, S.A. and Chloe for convenience's sake.
In 2001 defendant Simone Ubaldelli opened a business, Italian Only, through which he bought clothing from Italy and sold it to retail stores in the United States. (Benschar Decl. Ex. D ("Ubaldelli Dep.") 9:6-23.) Ubaldelli operated Italian Only out of his office in Beverly Hills, California. (Ubaldelli Dep. 4:14-18, 9:8-15.) A year after opening the business, Ubaldelli began to buy and sell designer handbags through Italian Only as well. (Id. at 10:17-24.) In 2003, Ubaldelli met Rebecca Rushing, the registered agent of Queen Bee, who was in the business of selling handbags. (Id. at 17:17 -- 18:9.) The two reached an agreement under which Ubaldelli would seek out available designer bags and then consult with Rushing to determine which bags to buy for the purpose of resale. (Id. at 26:19 -- 27:2.) Ubaldelli would then buy these bags and Rushing would sell them at her Queen Bee boutique shop in Huntsville, Alabama or through her website www.QueenBeeBeverlyHills.com. (Id. at 18:16-24; Ball Decl. ¶¶ 3, 8; Cochran Decl. ¶¶ 2, 6, 9.) The profits from any sales were deposited into a joint corporate account in the name of "Queen Bee of Beverly Hills," which Ubaldelli and Rushing split between the two of them.
(Ubaldelli Dep. 20:2-12, 21:3-16.) Both Ubaldelli and Rushing had the authority to sign checks for the account. (Id. at 27:6-7.)
Ubaldelli's primary source for designer bags was an individual named "Guido."*fn1 (Id. at 31:15-16.) Ubaldelli would purchase bags from Guido and have them delivered to his office in Beverly Hills. (Id. at 52:24 -- 53:11.) Once he received the bags, Ubaldelli would ship them to Rushing for her to sell. (Id. at 53:9-13.) Altogether, Ubaldelli purchased approximately one-hundred bags from Guido, including approximately forty or fifty bags that contained the "Chloe" mark. (Id. at 52:8-12.) Ubaldelli also bought roughly six Chloe handbags from an Italian distributor called World Business in Verona. (Id. at 31:21 -- 33:25.)
Chloe first became aware of the allegedly infringing activities of the defendants in this action in mid-December 2005 when, in the course of a seizure for a separate action, it obtained records of shipments between Sophisticated Spirit, an Internet vendor selling counterfeit Chloe bags, and Queen Bee. (Springut Decl. dated April 21, 2006 ("First Springut Decl.") ¶¶ 3-4.) The principal of Sophisticated Spirit claimed that Queen Bee supplied her with the counterfeit Chloe items. (Id. ¶ 4.) At the direction of Milton Springut, a partner for the firm Kalow & Springut LLP, who represent Chloe in this action, Rosa Santana, an administrative assistant at the firm, accessed Queen Bee's website, on which two items described as Chloe handbags were offered for sale. (Santana Decl. ¶ 2.) Santana then contacted Queen Bee and ordered a "Chloe Paddington Bag" to be delivered to her home in New York City.*fn2 (Id. ¶¶ 2, 3.) The bag was turned over to Springut the day after it arrived and has been in the firm's possession ever since, except when sent to Plaintiffs' expert to determine its authenticity and when sent to the Court in connection with Plaintiffs' motion for a preliminary injunction and seizure order in April 2006. (Id. ¶¶ 4, 5; First Springut Decl. ¶ 12; Benschar Decl. ¶ 2.) Though the bag sent to Ms. Santana bears the Chloe name and was represented on the Queen Bee website as a Chloe product, Sophie Garric, Production Manager for Chloe, S.A., examined the bag and determined that it is a counterfeit. (Garric Decl. ¶¶ 10--12.)
Plaintiffs also hired a private investigator, Terry Cochran, to purchase a Chloe item from Queen Bee's office in Huntsville, Alabama. (Cochran Decl. ¶¶ 1-2.) Pursuant to his instructions, Cochran called the Queen Bee office and purchased a Chloe Paddington purse. (Id. ¶ 9.) Once he received the bag, Cochran shipped it to Kalow & Springut LLP to be examined. Garric determined that this bag is a counterfeit as well. (Garric Decl. ¶¶ 10--12.) Ubaldelli does not dispute that the bags purchased by Plaintiffs' agents are counterfeit and were not manufactured, produced, or in any ...