A brother and sister who operated a retail store on the Santee Alley bargain strip in the Fashion District of Downtown Los Angeles say they were falsely accused of dealing in counterfeit merchandise and forced out of business by "malicious prosecution" pressed by representative of the Louis Vuitton and Christian Dior fashion labels.
George and Marijeanne Antounian recently filed a lawsuit against the two Paris, France-based luxury brand giants and their attorneys. The Antounians claim that a prior suit that the companies filed against them was itself unlawful. Representatives of Louis Vuitton and Christian Dior maintain that the Antounians' claims have no legal merit.
The battle between two of the world's best-known luxury brands appears set to play out against the hardscrabble backdrop of Santee Alley, a two-block row of retailers that runs south of Olympic Boulevard between Santee Street and Maple Avenue in the heart of the Fashion District on the southern end of the city's Downtown. The area functions as a de facto discount store, with hundreds of merchants gathered cheek-by-jowl, filling a gap in the local marketplace, where giant chains such as Wal-Mart and Target have difficulty establishing a presence due to a combination of the high costs of urban real estate and city ordinances that place restrictions on so-called "big-box" retailers.
The roster of business owners on Santee Alley is dotted with immigrants from Iran, Korea, Israel, Morroco, and Tunisia who manufacture the clothing they sell. West Africans traders specialize in textiles and accessories. Latinos roam with pushcarts full of ice cream or belts hung on their arm. Some of the immigrant entrepreneurs follow a well-worn path of commercial growth on Santee Alley, starting as roaming peddlers, then sub-letting a small surface of wall at the front of established stores to display watches, wallets and other goods for sale, and finally renting one of the retail spaces themselves.
Clothing, accessories and other merchandise is considered counterfeit if it carries a trademark--often a label or brand--without permission. CDs and DVDs that contain music or movies that have been reproduced without permission are also considered counterfeit. Counterfeits differ from "knockoffs," a common term to describe clothing or other items that mimic popular designs or fashions but do not attempt to use a label, brand or trademark without permission.
Many big designer labels and representatives of the music and film industries often fund their own investigations into counterfeiting in the Downtown area and other locales. The investigators typically turn matters over to the Los Angeles Police Department (LAPD) which in some cases uses the information to obtain search warrants and conduct raids, often with the help of security guards from the Fashion District Business Improvement District (BID), a private association of property owners in the area.
Some of the entrepreneurs on Santee Alley do, indeed, deal in counterfeit merchandise, often peddling cheap versions of famous labels, with the discrepancy obvious because of lower-quality craftsmanship or even occasional misspellings of famous designer names. A great many refrain from dealing in counterfeit goods, though, relying instead on products made in their native lands or deploying standard merchandising strategies to stock their shelves with various domestically made and imported goods that will meet the demand of the tens of thousands of shoppers who flock to Santee Alley daily.
The Antounians maintain that they were among the merchants who operated legally, selling accessories and other merchandise, with no counterfeit goods in their inventory. A federal court apparently agreed, and eventally dismissed the lawsuit against the Antounians and awarded them approximately $70,000 in lawyer's fees. That covered about half of what they spent on legal representation in fighting the case, according to a lawyer representing them in their suit against the luxury brands.
The Antounians are seeking unspecified damages from the companies in a malicious prosecution suit alleging that representatives of Louis Vuitton and Christian Dior, and their respective lawyers, knew that allegations of copyright and trademark infringement against them were not true but nevertheless continued with the litigation.
The cost of the defending against the charges eventually forced the Antounian's to close their Bijou Palace shop on the 1100 block of Santee Alley, according to the couple, who claim they were also forced to liquidate their inventory, a process that typically involves selling off merchandise at very low prices.
The Antounian's malicious prosecution lawsuit claims that representatives of the two giant luxury labels hired a private investigation company called Investigative Consultants in 2005 to determine whether stores on Santee Alley were selling counterfeit Louis Vuitton and Christian Dior wallets, purses, and other goods. An investigation of nearly two years led to the firm to wrongfully conclude that the Antounians had sold fake Louis Vuitton and Christian Dior products, according to the lawsuit. The Antounians claim that a video used in the investigation showed such counterfeit transactions occurring at adjacent stores and on the pathway of Santee Alley itself, but not at Bijou Palace.
"The Antounians' store sold only costume jewelry and was not in the business of selling purses and wallets," said Sean Macias, managing partner of Macias Counsel, Inc. in Glendale, and the lead attorney representing the Antounians.
William Salle, co-counsel for the Antounians, said that a member of the investigation team, Arianna Ortiz, admitted she provided false testimony in identifying Bijou Palace as one of the stores selling knockoff products.
"Ortiz alerted Kris Buckner, president of Investigative Consultants, and lead counsel Janine Garguilo for Louis Vuitton and Christian Dior, of the errors in the investigation reports months before trial, but legal action still proceeded against the Antounians," according to Salle.
The Antouians lawsuit also alleges that during a trial on accusations against them, in July 2007, Buckner testified that he never saw handbags, wallets, or sunglasses--or any Louis Vuitton or Christian Dior items--for sale at Bijou Palace.
"These were the same items that the Antounians and Bijou Palace were to have allegedly sold," said Salle.
Macias said that efforts to combat counterfeiting of merchandise are understandable, but contended that his clients were wrongly caught up in the efforts.
"Maybe they wanted to send a message to would-be counterfeiters that they mean business," Macias said. "Instead, Louis Vuitton and Christian Dior succeeded only in destroying an innocent small business."
