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Los Angeles brand accuses fast-fashion giant of trademark infringement and unfair competition in a complaint filed in California district court, citing monetary and reputational harm.
The lawsuit included the Hong Kong-based owner of Shein's website and trademarks, and Shein U.S. Services, the Chinese e-tailer's Delaware subsidiary. Chrome Hearts sues them using fictitious names due to the identities and capacities of the defendants.
Laurie Lynn and Richard Stark-owned company accuses Shein of manufacturing, marketing, and selling handbags and accessories that infringe on Chrome Hearts' federally registered marks, including their cemetery cross patch, CH Plus cross, and dagger design.
The label stated that registrations for the Chrome Hearts marks are valid, incontestable, and produced in LA. The marks are inherently distinctive and globally recognized due to longstanding use, advertising, and registration. Chrome Hearts has obtained trademark registrations without secondary meaning proof, and its products include handcrafted clothing and denim.
Since 1988, the CH Plus cross and cemetery cross patch and dagger design have been consistent Chrome Hearts marks on various goods for over 3 decades, gaining widespread acceptance and recognition by the public and trade in the US.
Chrome Hearts has explicitly stated that it has not authorized Shein, a company that originally sold third-party products and later turned to branded merchandise, to use its intellectual property, including the Chrome Hearts marks. As a consequence, Shein's products have allegedly led to confusion among consumers, potentially even affecting Chrome Hearts' customer base.
"Chrome Hearts purchased and inspected the accused products, confirming they did not originate from or contain authentic Chrome Hearts marks. Shein, based in China, manufactured the products. Defendants used the Chrome Hearts marks without permission."
The lawsuit alleges that the new Forever 21 stakeholder deliberately intended to confuse the public, harm Chrome Hearts, and benefit from its goodwill associated with the Chrome Hearts marks. Chrome Hearts seeks injunctive relief, the destruction of remaining inventory, three times the profit derived from the trademark infringement, and costs and attorneys' fees. Alternatively, it may accept up to $2 million per trademark infringed upon per type of good.
The defendants intentionally misused Chrome Hearts' trademarks, taking advantage of the company's reputation for personal gain. Chrome Hearts has worked hard to establish a strong reputation for itself. As a result, the defendants are unfairly benefiting from Chrome Hearts' property rights, resulting in undeserved financial gain.
Shein takes infringement claims seriously. A spokesperson said, "We don't intend to infringe on anyone's intellectual property. It's not our business model." Shein requires suppliers and sellers to follow policy and certify their products don't infringe third-party IP. They invest in improving their product review process.
Despite ongoing complaints, Shein, faces a class-action lawsuit filed in California federal court, alleging egregious copyright infringement amounting to racketeering, violating the Racketeer Influenced and Corrupt Organizations Act (RICO). Similarly, H&M Group had legal disputes with Shein over numerous instances of copyright violation in Hong Kong's High Court, based on a summons filed in July 2021. Shein has also faced lawsuits from artists and brands like Dr. Martens, Ralph Lauren, Stussy, and Oakley for selling products that allegedly infringe on their intellectual property. Moreover, small designers on social media criticize Shein for engaging in copycat behavior.
In March, Shein sued Temu for copyright infringement. Temu countered by highlighting Shein's legal troubles.
Temu denies all allegations in the sole intellectual property infringement lawsuit it faces since its inception. Shein, on the other hand, has been named as a defendant in over 70 such cases by international rights holders and independent artists since 2019.