A Venice, Italy-based wine producer has sued a German wine distributor for unfair competition and trademark and copyright infringement in a federal court in California, alleging that the defendant ships to the United States for sale by a U.S. distributor a “gray market” product purporting to be the plaintiff’s pinot grigio wine. Santa Margherita, S.p.A v. Unger Weine KG, CV12-3499 (U.S. Dist. Ct., C.D. Cal., filed April 23, 2012). According to the complaint, the U.S. distributor entered a consent order with the plaintiff in 2011 prohibiting it from importing, selling, marketing, and distributing Santa Margherita Pinot Grigio in the United States.  

The plaintiff contends that it sells its wine in the United States exclusively through an Illinois distributor and closely monitors the distribution network to ensure product quality. The complaint alleges, “Gray Market Santa Margherita Wine is sold and distributed outside this authorized distribution channel and is not subject to the same quality control standards as Authorized Santa Margherita Wine.” The product labels purportedly share some characteristics but differ in number, color, content, font, and border styles. Seeking preliminary and permanent injunctive relief, the plaintiff also seeks an order requiring an accounting for all profits and “trebling such profits for payment to Plaintiff,” compensatory and punitive damages, attorney’s fees, and costs.