Hyundai Drives $5M Trademark Win Through South Florida Company
The Florida company was accused of selling counterfeit auto parts bearing the Hyundai name on the gray market.
February 26, 2020 at 08:02 PM
3 minute read
The original version of this story was published on National Law Journal
Hyundai Motor Co. won a $5 million consent judgment against a North Miami Beach-based company accused of distributing gray market auto parts.
Direct Technologies International Inc. stipulated to willful trademark infringement, false designation of origin and other causes of action before U.S. District Judge Max Cogburn Jr. of the Western District of North Carolina.
Cogburn also entered a permanent injunction blocking DTI from misrepresenting, importing or distributing nongenuine Hyundai parts. Hyundai will recover $5 million in damages and attorney fees under the agreement.
Hyundai sued DTI in December 2017, accusing it of importing used, counterfeit or defective parts and "palming them off" as genuine Hyundai parts sourced through the company's authorized distribution chain. Trial was set for June 15.
Hyundai also obtained default judgments against two alleged overseas suppliers at the International Trade Commission and was closing in on a trial there against DTI.
"This case is a win for Hyundai owners who want peace of mind that Hyundai-branded parts used on their cars are approved by Hyundai Motor America and have gone through its quality control," Barry Ratzlaff, chief customer officer for Hyundai Motor America Inc., said in a statement.
DTI, led by president Dmitriy Yurchenko, accused Hyundai of trying to monopolize the parts market and using its trademarks to restrain trade. It noted the Federal Trade Commission warned Hyundai in 2018 that conditioning its warranties on the use of genuine Hyundai parts could run afoul of the FTC Act. According to the consent judgment, DTI acknowledged its antitrust claims are "without merit."
Pillsbury partner Kenneth Keller and counsel Christopher Stretch represented Hyundai before both the district court and the ITC. Partner Kecia Reynolds and senior associate Monica Hernandez also litigated the ITC action.
Womble partners Hayden Silver III and James Derrick and associate Jonathon Townsend, Pillsbury counsel Vijay Toke, and Hyundai Motor America assistant general counsel Jason Erb also appeared in the district court litigation.
DTI was represented by Christina Trimmer, Kathryn Gromlovits, Lucas Garber, Samuel Long and W. Thad Adams of Shumaker, Loop & Kendrick of Charlotte, North Carolina in district court. Fish & Richardson represented the company at the ITC.
Read the consent judgment:
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