In its complaint, filed earlier this month in the US District Court for the Northern District of California, Fitbit alleged that Laguna 2 took faulty products, originally manufactured by Fitbit, placed them in counterfeit packaging, and resold them as “refurbished”.
Fitbit said these products are a normal byproduct of its manufacturing process, and that products that do not meet “high-quality standards” are designated be scrapped or recycled.
According to Fitbit’s complaint for trademark infringement, Laguna 2 somehow diverted these byproducts from the supply chain and sold them to non-authorised online retailers, including Groupon.
These items were returned to Groupon in droves after customers realised they were faulty. This not only caused Fitbit “significant monetary damages, but it also seeks to seriously undermine the established reputation for quality and reliable products and services that Fitbit has worked so hard to achieve”.
“Customers who have purchased ‘Fitbit’ branded products from the defendants ... have been sorely disappointed and confused, leaving scathing reviews and returning thousands of these products.”
“As such, Fitbit not only lost the opportunity to sell an authorised high-quality products to hundreds of thousands of consumers, but also has taken a significant and ongoing hit to its reputation, brand, and goodwill with members of the consuming public.”
Fitbit asked the court to order Laguna to send a Fitbit-approved notice to any customer who purchased the infringing product, informing them that the sale had violated federal trademark and counterfeiting laws.
Laguna should also be enjoined from infringing, counterfeiting or diluting the Fitbit trademarks in any way, as well as pay for any and all profits and damages resulting from the infringement.