Amazon Sellers Sued for Unauthorized Resale

Sound United, who does business as Denon, Polk Audio, Marantz, Definitive Technology, Heos, Boston Acoustics, and Classé filed three separate lawsuits against third party resellers that operated on Amazon, named “audio visual guy” (–19-cv-12541/Sound_United_LLC_v._Amazon_Seller_”audio_video_sales_guy”/1/), “Amazing Deals Online” (–19-cv-12542/Sound_United_LLC_v._Amazon_Seller_”Amazing_Deals_Online”/1/), and “Active Trade” (–19-cv-12540/Sound_United_LLC_v._Amazon_Seller_”Active_Trade”/1/).  While the suits are filed separately, they are virtually identical.

Sound United is a manufacturer of audio/video products. They use brand names with trademarked logos registered with the U.S. Patent and Trademark Office which include Denon (2,176,147); Polk Audio (3,533,922); Marantz (1,538,024); Definitive Technology (1,681,827); Heos (4,756,918); Boston Acoustics (1,291,939); and Classé (3,113,681) to sell their products.

 The complaint claims that “audio visual guy,” “Amazing Deals Online,” and “Active Trade” caused Sound United significant harm by selling materially different Sound United products and damaging the company’s reputation, interfered with company’s quality control, and caused consumers confusion and harm by selling products that are not subject to warranties. It says that the defendants violated Sound United trademarks and the Lanham Act by selling products under Sound United’s established brand names.

Sound United has Authorized Dealer Agreements and Authorized Distributor Agreements with its dealers and distributors. As explained in the complaint, these agreements require authorized distributors to sell their products to authorized dealers at authorized locations. Web domains are only permitted to sell to consumers if they maintain a certain level of quality control. The plaintiff claims that this policy is a well-known fact in the retail industry at large, and specifically amongst audio product retailers and that therefore the defendants knew about it.

Additionally, since becoming aware of the defendants’ selling their products without authorization Sound United has sent notifications to each of the defendants informing them of the two agreements and making them aware of the company’s policies. The plaintiff also states that this policy includes a provision that the product warranty is only valid if it their products are sold in this way because of the quality assurance the system affords them. On Amazon, where the defendants all distribute products under one or more of Sound United’s brand names, the products are advertised to have a warranty, information for which the consumer “may also be able to find… on the manufacturer’s website” despite the fact that Sound United does not give a warranty to products that are not sold by their authorized dealers and distributors.

The complaint alleges that the defendants committed trademark infringement, tortious interference with Sound United’s contracts and business relationships, and engaged in unfair and deceptive business acts under Mass. Gen. Laws c. 93A. For each of the cases, the plaintiff asks the Massachusetts District Court to both initially and permanently enjoin the defendants and their associates including Amazon from using, selling, or obtaining  Sound United intellectual property or products in any way that violates Sound United’s Authorized Distributor and Dealer Agreements, or further committing unfair competition acts. They also ask for an order to recall, hold, and destroy of materials by the defendants with the unauthorized use of Sound United’s trademarks. Sound United requests monetary rewards in the amount of their actual damages plus treble damages pursuant to 15 U.S.C. § 1117 and M.G.L. c. 93A, the maximum allowed pre- and post-judgment interest, and attorney’s fees and expenses incurred in pursuit of these cases.