An employee's single act of shipping a counterfeit item into New York, combined with his employer's substantial activity involving New York, supports the exercise of personal jurisdiction over the employee under N.Y. C.P.L.R. § 302(a), the U.S. Court of Appeals for the Second Circuit ruled. The court concluded that the facts in the record, viewed most favorably to the plaintiff trademark owner, established that the employee either shipped the counterfeit item himself or was responsible for its shipment. The court also found that the record established that the employer entity had made numerous sales of branded merchandise to New York customers, and that those sales could be considered in concluding that the employer entity had the requisite minimum contacts, even though those sales did not involve the trademark owner's merchandise. These additional sales could be imputed to the employee, the court concluded, because the record further established that he had shared in the employer's profits, had joint access to the employer's bank account, used revenue from the employer to pay his rent, and shared in the decision-making and execution of the purchase and sale of the branded items.
Chloe v. Queen Bee of Beverly Hills LLC, 2010 U.S. App. LEXIS 16192 (2d Cir. Aug. 5, 2010) Download PDF
Editor’s Note: The opinion specifically reserves the separate question of whether the sale of a counterfeit bag to a mark owner's investigator or agent constitutes an act of trademark infringement, noting that the Second Circuit has yet to rule on the issue of "manufactured contacts."