Wal-Mart, Hilfiger fight on the Net
Wal-Mart may not sell designer suits, but its Internet store is now the subject of one.
Tommy Hilfiger U.S.A. Inc. announced Monday it is seeking legal action against Wal-Mart Stores Inc. for allegedly selling counterfeit Tommy Hilfiger merchandise, including socks and T-shirts, over its Web site.
The case raises questions about the differences between retail sales on the Internet and in the real world.
"It is outrageous for a company of Wal-Mart's stature and sophistication to harm consumers by engaging in counterfeit commerce, particularly over the Internet, where Tommy Hilfiger does not presently authorize sales of its products," said Joel Horowitz, Chief Executive Officer of Tommy Hilfiger U.S.A., in a statement.
In documents filed with a U.S. Federal District Court, Tommy Hilfiger asked the court to hold Wal-Mart in contempt for violating a 1996 injunction against the retail chain "knowingly and/or intentionally" infringing Tommy Hilfiger's trademarks.
This is the third time in four years Tommy Hilfiger has tangled with Wal-Mart in the courts. The clothing designer filed suit against Wal-Mart in 1994 and 1996 for infringement, and in 1996 Wal-Mart agreed to a permanent injunction, though the chain claims nothing was ever proven.
"Wal-Mart is not interested in selling counterfeit merchandise," said Wal-Mart spokeswoman Betsy Reichemeyer. She said Wal-Mart has verified that at least half of the clothes in question are of legitimate manufacture.
The online store is central to Tommy Hilfiger's case. Since the designer will not sell its clothes directly to Wal-Mart, the chain said it cannot buy Hilfiger goods in enough bulk to sell through their store outlets.
But since the store needs less merchandise to offer an item through its Web site, Wal-Mart buys the Tommy Hilfiger clothes from a third party in relatively small amounts and sells them through its online store.
Wal-Mart also offers the clothes through its Sam's Wholesale Club subsidiary.
Hilfiger claims Wal-Mart is not authorized to sell its clothes through the Internet or in any other venue, but Wal-Mart argues it needs no authorization.
"If the goods are purchased legitimately, we have the right to sell them," Reichemeyer said.
ZDTV's Joe Belden contributed to this report.