Crocs wins $56 million ruling

Judge says Chinese Net retailer violated trademarks, patents

By Joyzelle Davis, Rocky Mountain News (Contact)

Tuesday, May 13, 2008

Crocs announced Tuesday that its Jibbitz unit won a $56 million judgment against a Chinese Internet retailer that sold alleged knock-offs of the playful snap-on shoe decorations.

U.S. District Judge James Mahan ruled last month in Las Vegas that Jinjiang Huakai Shoes & Garments violated Jibbitz's trademarks and patents and ordered Jinjiang to stop selling its infringing products.

The ruling was a default judgment because the Chinese company never responded to the complaint or showed up in court.

"We are satisfied by the court's decision, further protecting the Jibbitz brand and copyrights," said Rich Schmelzer, president of Niwot-based Jibbitz, in a statement.

"As an innovative company, we are determined to protect our intellectual property. Moving forward, we will continue to take the necessary measures to defend our intellectual property against infringers."

This is the second copyright infringement award for Jibbitz in the past year. Last year, it won a $1.8 million judgment against Joinworld Industrial and Trading Ltd.

Jibbitz filed its lawsuit Feb. 22, serving it that same day to Jinjiang at the World Shoe Association Trade Show in Las Vegas. Las Vegas police seized 179 infringing items from the defendant's booths as well on that day, according to court documents.

Jinjiang claimed to be an authorized Jibbitz supplier, distributing business cards with the Jibbitz name and stamping its charms to indicate they were legitimate products.

"The nature of the product (small lightweight items) facilitates infringement on a massive scale," Mahan wrote in his order dated April 29. "The nature of the sales channels (online order taking and fulfillment by common carrier shipping) makes the potential volume of infringement extremely large and geographic scope global."

Sheri Schmelzer, a mother of three young children, co-founded Jibbitz in the basement of her Boulder home with her husband, Rich. Crocs paid $10 million in 2006 to buy Jibbitz, which now makes some 1,600 snap-on ornaments that fit into the holes on Crocs shoes. Most Jibbitz sell for about $3.

davisj@RockyMountainNews.com or 303-954-2514

• May 14, 2008

  11:37 a.m.

  Suggest removal

  SeaBass writes:

  They'll never collect a dime and this was probably their best revenue strategy for the year.

• May 14, 2008

  4:27 p.m.

  Suggest removal

  Tommy writes:

  Glad to see Crocs being ripped off since they moved their production to China. Hopefully the knock off company will continue to copy the products and put Crocs out of business, just so they can get a taste of their own business practice.

  Crocs exports American jobs.