Coach Lawsuit Leads to FL Flea Market Bankruptcy

A Florida based flea market has filed for Chapter 11 bankruptcy due to a three-year lawsuit with Coach over alleged sales of counterfeit items.
Visitors Flea Market filed for bankruptcy protection in part to protect an awaiting sale of the entire business for $5.1 million to Treasure Island Real Estate Partners. After the death of founder and owner Delroy Josephs in November 2013, family members have disagreed over the sale of the business.
Federal agents raided the flea market in December of 2011, as per documents filed in the Coach lawsuit. Coach claimed over 500 counterfeit purses and other items were being sold at stands throughout the market.
Coach is seeking maximum damages for alleged willful violation of trademark laws: each violation could potentially cost up to $2 million a piece.
Investigators for the leather goods company toured the Visitors Flea Market months before the raid; they handed out letters ordering vendors to stop selling the alleged counterfeit merchandise.
Coach accused Josephs of knowing about the knockoffs being sold, but he denied the allegations. According to bankruptcy documents, a settlement agreement was signed by an attorney for Josephs’ estate six months after his passing. The settlement amount was not revealed.
Julio Batista, one of the market’s vendors, signed an affidavit in 2011 that he witnessed a salesman distributing counterfeit Coach purses; the man was identified as the “Chinese Man.” Batista claimed he did not know the items were knockoffs.
“The items displayed at my booth were sold to me through a Chinese Man that comes weekly to the flea market and sells these items in cash,” according to Batista’s affidavit. “This is a very common type of business for a small flea market business.”
Two companies related with the market specifically filed for bankruptcy: the owner and operator, Visitors Flea Market Inc., and a separate leasing company that rented out over 250 vendor booths.
Visitors Flea Market provided a general range of its debt in filing documents—between $1 million and $10 million.
The post Coach Lawsuit Leads to FL Flea Market Bankruptcy appeared first on The Bankruptcy Blog.