NLV swap meet to block sale of counterfeit goods

Grace Leong

Wednesday, May 24, 2000 | 11:07 a.m.

Broadacres Inc. of North Las Vegas has agreed to be more vigilant in curbing sales of counterfeit merchandise at its swap meet and will pay $85,000 as part of a settlement with Levi Strauss and Co. and Nike Inc.

In a July 1999 lawsuit filed in U.S. District Court, the plaintiffs said the Broadacres Swap Meet at 2930 North Las Vegas Blvd. was liable for "contributory" trademark infringement because it allowed the continued sale of counterfeit merchandise despite repeated warnings over the last two years from the plaintiffs and the Western Anti-Counterfeiting Coalition.

Levi Strauss and Nike accused Broadacres of deliberately flouting regulations that prohibit such sales despite being served information listing the vendors that allegedly sold counterfeit goods and information stating what trademarks were being infringed.

U.S. District Judge Philip Pro, in an order issued April 24, dismissed the action because the parties settled.

But Jeffrey Hyman, the plaintiffs' attorney, said they are still waiting for Broadacres to sign the settlement agreement and said the case isn't over until Broadacres has fulfilled all the terms of the agreement and starts making payments to the plaintiffs.

Broadacres' attorney, John Hawley, could not be reached for comment.

Under the agreement, Broadacres is to bear the costs of retaining private investigators through June 2001 to make unannounced inspections of the swap meet and undercover purchases of any counterfeit Levi's and Nike merchandise, and to train the swap meet's personnel to detect such goods.

Broadacres is also prohibited from interfering with the plaintiffs' efforts to enforce their trademark rights, including monitoring vendor activity at the swap meet, communicating with the vendors and taking any action authorized by the court.

The agreement also requires Broadacres to confiscate any counterfeit goods sold by any vendors and to permanently prohibit such vendors from selling any merchandise on its premises if they repeat the same offense.

Broadacres is also required to pay the plaintiffs $2,500 in damages on the first violation of the agreement, $5,000 on the second violation and $25,000 on the third violation.

"Broadacres did a good job of cleaning the flea market. They understood that protecting the public from counterfeit goods is important and they've worked extremely hard and cooperatively since the lawsuit was filed to clean up the swap meet," Hyman said.

He said joint efforts to train the swap meet's security team have resulted in a "very big reduction" in the number of counterfeit products on sale as well as a sharp drop in the number of vendors selling such products to about six from 30-40 a year ago.

The plaintiffs' suit cited evidence from a California investigator, Heather Holdridge of Brands Security Corp., who conducted three sweeps of the market and found the 30-40 vendors allegedly selling merchandise bearing counterfeit trademarks including Levi Strauss, Nike, Tommy Hilfiger, Warner Bros., Disney and Adidas.

In the first sweep in December 1997, Holdridge identified 26 vendors selling allegedly counterfeit goods and found 8,000-10,000 units of counterfeit clothing and accessories, the suit said.