New York judge rules against Alibaba in Squishmallows counterfeit sales lawsuit
New York court issued a pivotal directive against Alibaba, compelling the Chinese ecommerce giant to confront a lawsuit initiated by a U.S. toymaker. The lawsuit alleges that Alibaba's digital platforms played a role in facilitating the trade of counterfeit Squishmallows, the cherished plush toys manufactured by Kelly Toys Holdings.
Judge Jesse Furman, overseeing proceedings at the Southern District Court of New York, rejected Alibaba's motion to dismiss the lawsuit filed by Kelly Toys Holdings, an affiliate of Jazwares, operating under the umbrella of Alleghany Corp., a part of Warren Buffett's Berkshire Hathaway conglomerate.
Alibaba, recognized as China's largest ecommerce entity, attempted to have the case dismissed, arguing that it was named as Alibaba.com in the lawsuit rather than its formal corporate identity. However, the judge declined this motion. Kelly Toys' complaint highlighted persistent sales of fake Squishmallows by merchants using Alibaba's platforms, despite prior legal actions to halt such activities. Approximately 90 ecommerce companies faced legal action to stop the sale of counterfeit toys, with Alibaba being named as a defendant in March.
Judge Furman's statement regarding the case indicated, «Kelly Toys alleges that, notwithstanding that awareness, infringing listings — including some by the Merchant Defendants — have continued to proliferate on the Alibaba platforms.» He further clarified that the court deemed these claims plausible, resulting in the denial of the motion to dismiss them.
This ruling underscores the ongoing legal battle between Kelly Toys and Alibaba, signaling a pivotal moment in addressing alleged counterfeit sales
