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40 people fined $1M+ for selling, distributing counterfeit Playero products

U.S. District Court Judge Pedro Delgado-Hernández ruled against 40 defendants for selling and distributing counterfeit Playero Inc. products, slapping them with a global fine of more than $1 million for the infringements, this media outlet learned.

According to the default judgment and permanent injunction issued Wednesday, the defendants were found guilty of breaching the familiar Playero trademark, which is owned by a Rincón-based beachwear company that registered the word-and-sun-surrounding-Puerto-Rico artwork and brand in August 1977.

The order also bans the defendants from “offering for sale, advertising, promoting or displaying any product that is a simulation, reproduction, counterfeit, copy, or colorable imitation of the Playero products, incorporating the PLAYERO trademark and/or the Playero trade dress,” according to the lawsuit filed by the McConnell-Valdés law firm on the retailer’s behalf.

In the order, 39 defendants were fined $25,000 each and $100,000 against the remaining defendant, who was a repeat offender.

The case began May 2, 2017, when Playero Inc., filed a “verified complaint” at the U.S. District Court in San Juan requesting a temporary restraining order, a preliminary and permanent injunction, and monetary damages for trademark infringement, trademark counterfeit, trade dress infringement, false designation of origin, and unfair competition against 55 defendants.

The next day, the court issued “Show Cause” order, a Temporary Restraining Order, a Seizure Order, a Bond Order, and scheduled the Show Cause hearing for May 9, 2017.

On May 10, 2017, after the Show Cause hearing, the federal court issued a preliminary Injunction against the defendants prohibiting them from doing any business related to the Playero brand.

The team of attorneys at McConnell-Valdés, headed by firm Partner and trademark expert Dora Peñagarícano, then negotiated and reached settlement agreements with 15 defendants. The remaining 40 — many of whom were selling Playero knock-offs at their stores or through social media — will now have to compensate Playero Inc. for its losses.

For the past 40 years, Playero has been in the business of merchandising and retail sale of beach apparel and accessories; namely, bathing suits, surf tops, t-shirts, jackets, caps, visors, key chains, and towels, among others.

“Due to its unique designs and the high quality of its products, Playero has gained island-wide recognition and popularity,” according to the original complaint.

At present, the legitimate Playero products are offered for sale exclusively at four company-owned stores – one in Rincón; two in San Juan (Plaza Las Américas and Loíza Street); and one in Ponce (Plaza del Caribe) – and through its website. Prices range from $20 for a towel to $45 for long-sleeved shirts for men and women.

The unauthorized copies of the Playero products sell for between $8 and $25 each, causing financial harm and damage to the brand’s reputation, according to the complaint.

Author Details
Author Details
Business reporter with 29 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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