Hey, there! Log in / Register

Bedford company turns to courts to try to cork up unauthorized online sales of its wine-preservation wares

Coravin, a Bedford company that makes systems that let restaurants and oenophiles drink from uncorked bottles, is suing some guy in New Jersey - and 100 "John Does" - for allegedly selling unauthorized and often used or broken models on Amazon Storefront and other online marketplaces.

Coravin, whose products use needles and canisters of pressurized argon to let users get wine out of bottles without actually uncorking them, says it's been forced to set up some elaborate systems to crack down on unauthorized sales because negative reviews of its products sold that way are giving it a black eye.

But even with that, Coravin says some people, such as Ji "Jason" Cheng of Englewood, NJ, continue to sell Coravin or Coravin-branded products online, typically as "new," which implies they come with warranties, which they don't, because, as part of its anti-fraud efforts, Coravin now only provides warranties to products purchased through authorized sellers.

In a trademark lawsuit against Cheng and unknown John Does, filed yesterday in US District Court in Boston, Coravin said the company asked Cheng to knock it off last November, but that all he did was change his Amazon seller name and continue to offer alleged Coravin products for sale, as recently as last week.

Coravin said it had to go to considerable lengths to identify Cheng, but that once it did, it was easy to watch him continue to offer Coravin stuff - because while Amazon lets sellers change names, the sellers retain the same unique Amazon numerical ID as before. Also:

[O]n or around January 27, Defendants attempted to purchase five hundred and twelve units of Coravin products from a retailer offering a “Friends and Family” discount. Upon information and belief, based on this enormous quantity, Defendants intended to resell the items on Amazon without disclosing to consumers that the items would not come with the Limited Warranty.

Defendants' unauthorized advertisement and sale of non-genuine products bearing the Coravin Trademarks is likely to cause confusion, cause mistake, or deceive consumers because Defendants' use of the Coravin Trademarks suggests that the products Defendants offer for sale are sponsored by, authorized by, or otherwise connected with Coravin when, in fact, they are not.

Defendants' unlawful actions constitute active misrepresentation as to the source of the products they sell. These false representations tend to confuse customers and induce them to believe that Defendants' products are genuine Coravin products when, in fact, they are not. ...

As a result, Coravin has suffered, and continues to suffer, immediate and irreparable harm. Coravin has also suffered, and continues to suffer, damages, including, but not limited to, loss of business, goodwill, reputation, and profits in an amount to be proven at trial.

Topics: 
Free tagging: 
AttachmentSize
PDF icon Complete Coravin complain609.78 KB
Ad:

Comments

I admit I had to read this a few times before I finally understood what the apparatus in question is for. Isn't it weird that an "uncorked" bottle still has a cork, while a "corked" bottle doesn't have one?

Ah, the joys of English. I'm always amazed that anyone could learn it as a second language. Mad props to them.

At first I thought this was in reference to the sealable plastic bags restaurants use to allow people to drive home with opened bottles of wine.

So I'm safe from unauthorized gadgets....good old ripple. : )

These false representations tend to confuse customers and induce them to believe that Defendants' products are genuine Coravin products when, in fact, they are not.

I have seen the feds rain hell down on t shirt bootleggers and purse counterfeiters.

Why is Coravin not afforded the same courtesy?

It doesn't appear that Coravin is claiming that the sellers are selling counterfeit product... or they're being disingenuous about that claim at best. It appears that the sellers are buying real Coravin product and then reselling it. Which, in any reasonable world, ought to be 100% legal.

It sounds more like it's the fact that they are selling used items and misrepresenting them as new. If they were selling them but indicating that they were used, or in "as is" condition without a warranty it might not be a problem.

I knew a kid who had an internship at Bose and they were able to buy equipment that had been used for testing or other reasons at a huge discount. Then enough of the items started showing up for warranty claims after the employees had sold them that the company halted the program and all of those items were then destroyed. Not sure if that's still the case or not but it was at that time. That may be how this company found out about this secondary market too.

Bose still offers a 50% discount to employees and contractors but only after 90 days. The regular warranty applies but in Bose world you can send it back and get a new one. So even after the discount and/or return/repair, they're still making money.

In Coravin's case, let's say they also enjoy upwards of 50% margins on their popular $400 model. If someone is buying used/defective units at a bargain price and then offering them as new at a slight discount from the $400, not only do they damage Coravin's reputation and pricing strategy, but they also reap a windfall from pocketing the margin on a what would be a new model minus what they paid for the old/defective/unwanted one, which could be $300 while they saddle Coravin with any return/repair costs.

I've never actually seen one of these.

This wasn't about a straight discount on new equipment, it was for stuff that they had used for testing or other applications. I wasn't implying that they got rid of a discount program entirely, just that the used equipment that they used to let go for next to nothing was taken off the table.

If someone had planned to buy a large quantity, those items were clearly new. If they resell them, so what? Sounds like Coravin is selling their stuff too cheap, if someone can buy it and make enough reselling it to make a profit.

Coravin isn't selling them too cheap. The reseller is getting bulk quantities using an insider 'friend & family' discount at another retailer.
These discounts are usually a little over the wholesale price the retailer payed, but less than even the lowest price you'd find an item on sale for.
This perk is really supposed to just be for employees and friend/family personal use. Typically a retailer would fire an employee for reselling ng for profit or for facilitating these large sale re-sellers. And the employee would have known in advance if the policy they violated.

So Coravin sells units with a $400 MSRP to Bob the dealer, at a wholesale price of $250. Bob retails them for $400, but also sells a few dozen to his employee Charlie at the "friends and family" price of $300. Charlie turns around and sells them on Amazon for $350.

Unless you believe price fixing ought to be legal, I don't see what claim Coravin has against anyone here.

Coravin is probably in the clear if they say that they will only honor warranty claims brought by the original purchaser who bought from an authorized reseller, but again that doesn't give them any claim against Charlie that I can understand.

From what I read online, Amazon is rife with these sorts of scams. Amazon's "partners" sell used merchandise and call it new, or sell counterfeit priduct and call it legitimate. Amazon doesn't really care because they get the profits from all these sleazy operations. Plus, it takes human time and effort to track down these illegitimate vendors, and Amazon is all about using its automated technology to eliminate the human employees.

This is one reason why I try to avoid buying anything from Amazon whenever I can. My first choice is always a local business that has a real store, and if I must go online, I can always find a legitimate (usually small business) alternative.

I agree with you about preferring local small businesses.

With that said, there's a key item to note when buying using Amazon. Amazon is itself a seller, but it also is an intermediary for third party sellers of the kind discussed in this thread. If you look at a listing, you can see the difference between "sold and fulfilled by Amazon," "Sold by Bob's widgets and fulfilled by Amazon," and "Sold by Bob's Widgets."

I have not seen anything to lead me to believe that there's a significant counterfeiting problem with items actually sold by Amazon.