Despite repeated raids and seizures, the companies continue to advertise and offer for sale counterfeit Ford-branded products
Dearborn, Mich.—With the assistance of state and federal law enforcement, Ford recently stated in a complaint that it has uncovered a “significant” global counterfeiting operation. Three U.S. companies and a Chinese business are alleged to manufacture, import, market, sell, and distribute a “massive number” of counterfeit Ford-branded truck grilles and other counterfeit Ford-branded parts and accessories.
Ford stated in a Aug. 8 filing that the companies sold to other third party resellers and to consumers directly, primarily through their own websites and through online marketplaces, such as Amazon, and that the unauthorized use of the Ford marks constitutes “willful trademark infringement” of the Ford marks.
However, despite the repeated raids and seizures, Ford alleges in the complaint that the defendants continue to advertise and offer for sale counterfeit Ford-branded products on their websites, and is seeking to to recover monetary damages and the “significant harm” to Ford, its brand and reputation.
The defendants include the following:
• Crov, a Delaware corporation with its principal place of business in San Bernardino County, Calif.
• Sunward, a California limited liability company with its principal place of business in Los Angeles County.
• QH, a Chinese business entity with its principal place of business in Qingdao City, China. QH does business through multiple interactive websites, including at least www.freedream4x4.com, and also does business under the business name Qingdao Yuanxi Auto Parts Co., LTD. Ford alleges that QH has imported counterfeit Ford-branded products into the U.S. through the Port of Los Angeles, and that QH maintains business operations in Walnut, Calif., and City of Industry, Calif., to enable QH to distribute the counterfeit products in the U.S.
• FD, a California corporation with its principal place of business in Los Angeles County.
Over the past two years, according to the filing, raids on the defendants’ warehouses resulted in the seizure of thousands of counterfeit products that Ford states would alone be worth millions of dollars if they were genuine.
“Defendants’ counterfeiting operations have resulted in consumer confusion and have harmed Ford’s business and the consumer goodwill associated with the Ford brand,” states the complaint. “Defendants, of course, also profited tremendously from their illegal conduct, at the expense of Ford and end customers duped into buying cut-rate counterfeit replica products, parts, and accessories.”
Ford claims that for at least two years and “likely stretching back even further,” the defendants have advertised, distributed, offered to sell, and sold, thousands of counterfeit Ford-branded products bearing counterfeit and/or infringing copies of the Ford marks.
Timeline of Events, as stated in complaint
• Ford first became aware of defendants’ counterfeit operation at the November 2019 SEMA-AAPEX trade shows, where Crov circulated a catalog that offered for sale numerous different counterfeit Ford grilles.
• Ford made test buys from Crov in 2019 and 2020. Those test buys from Crov arrived, and showed that the counterfeit products were initially sold by QH and then shipped by Sunward. Those shipments went first through Sunward’s New Jersey warehouse, and a second shipment went through its warehouse in Bell, Calif.
• In November 2020, law enforcement effected a search warrant at Sunward’s New Jersey warehouse, leading to the seizure of nearly 4,000 counterfeit grilles, along with over 5,000 F and R letters that are used in the grilles to replicate or colorably imitate the Ford marks. Counterfeiters will often separate the grille from the letters necessary to complete the counterfeit trademark in an attempt to evade detection and seizure of products by U.S. Customs, which Ford states further establishes “knowing and willful intent” in infringing the Ford Marks. 527 counterfeit spark/glow plugs, ignition coils, and emblems were seized at the same time.
• In May 2021, law enforcement initiated a site inspection of Sunward’s Bell, Calif., warehouse and found nine additional counterfeit Ford Raptor grilles. The site inspection also revealed that more counterfeit product was stored at a different nearby warehouse, owned by FD in El Monte, Calif., where law enforcement found numerous U-Haul trucks and a warehouse full of counterfeit products, seizing an additional 580 counterfeit Ford-branded grilles and more than 1,800 F and R letters used again in the grilles to “replicate, colorably imitate, and counterfeit the Ford Marks.”
The counterfeit products seized at these three facilities alone would be valued at approximately $2.5 million dollars, if they were genuine Ford products, the complaint alleges, adding that the “counterfeit and infringing products were, and are, of substantially different and lower quality than Ford’s genuine high quality products.”
• In December 2021, a sales representative for QH, associated with www.freedream4x4.com, sent out an offer to sell newly developed counterfeit “Ford” Raptor grilles, noting that some of the inventory was already in the U.S. Upon engaging with the QH sales representative, Ford states it was able to purchase these counterfeit grilles from QH directly. The counterfeit grille shipments showed QH as the shipper, and related documentation showed involvement of warehouses maintained in Houston, as well as Walnut, Calif., and City of Industry, Calif. The filing states that QH showed knowledge and intent to willfully infringe and counterfeit the Ford Marks: to avoid a customs seizure, the counterfeit grilles that were purchased came missing the F letter in “FORD,” which were then supplied in a separate shipment.
As a result of defendants’ infringement and counterfeiting of the Ford marks, Ford is seeking damages and an injunction, and an order of destruction of all of infringing and counterfeit products.
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