Rolex sued Melrose Jewellers for trademark infringement and counterfeiting. Melrose was buying used Rolex watches, replacing genuine parts like dials and bezels with fake parts, and selling the watches as genuine Rolex products. Rolex alleged that many of the watches sold by Melrose contained no genuine Rolex parts. The court ruled in favor of Rolex, ordering Melrose to pay $8.5 million in damages and shut down its website and related domains. The companies later settled out of court privately.

1. Rolex vs. Melrose Jewellers
By:
 Aayush Kumar Pandey (121113050)
 Satyam Singh (121113046)
 Akshay Ahirrao (121113052)
 Rahul Agarwal (121113014)

2. Case: Rolex Sues Melrose Jewellers
 Year/(s) of occurrence: started in 2008; 2012-
2013 (from filing to verdict)
 Type of Infringement: Counterfeiting,
Trademark Infringement, Cybersquatting

3. Brief details about the two companies
involved:

5. Type: Private Production output: 751,285 COSC movements
(2011)
Industry: Watch manufacturing Services: Maintainence Repair
Founded at/Founder: London, UK(1905) by
Alfred Davis & Hans Wilsdorf
Revenue: US$ 7.4 Billion (2012)
Headquarters: Geneva, Switzerland Owner: Wilsdorf Foundation
Area served: Worldwide Number of employees: 2800
Key people: Jean-Frederic Dufour (CEO) Subsidiaries: Montres Tudor SA
Products: Cellini, Day-Date, Datejust
Explorer, Explorer II, Daytona, GMT-Master II,
Lady Datejust, Milgauss, Sea Dweller, Sky
Dweller, Submariner, Yacht-Master
Website: www.rolex.com
Source: Wikipedia

6.  Founder: Krishan Agarwal
 Founded in year: 2008
 Website: www.melrose.com (now taken down)
 Active till: Mid 2013

7. What is ‘Trademark
Counterfeiting’

8.  Counterfeit is defined as "a spurious mark which is
identical with, or substantially indistinguishable from, a
registered mark."
 To prove a case of trademark counterfeiting, the
trademark owner must establish four elements beyond
ordinary infringement:
Contd.

9. 1) the defendant’s mark must be “counterfeit,” meaning
“a spurious mark that is identical with, or substantially
indistinguishable from, a registered mark” of the
trademark owner;
Contd.

10. 2) the trademark owner’s mark must be registered on
the Principal Register of the United States Patent
and Trademark Office in connection with identical
goods or services for which the defendant uses the
mark;
Contd.

11. 3) the defendant must not have been authorized by the
trademark owner to use the mark at the time the
goods or services were manufactured or produced;
and
4) the defendant must have acted with knowledge and
intent.

12. What were Melrose.com doing

13.  They were buying the original Rolex watches, taking
out the entities like the dials and bezels of the watch
and replace them with after market(fake) entities.
 Melrose jewelers used fake dials, fake bracelets, non-
Rolex diamonds.
 Only the case and movements were genuine.
Contd.

14.  They would buy absolutely trashy and old models in
order to cut the costs for buying, because keeping a
record of the old models was quite a difficult thing.
 A lot of models sold were of 1960’s & 70’s.
 They also altered the original bracelets because they
were a bit dull.
Contd.

15.  The manufacturers had contacts in India, which helped
them rebuild things.
 Overall, it was second hand Rolex watches which
were being refurbished.

16. Snapshot of the coupon instructions on the website:

17. The authentication of the website and products were very much
substantiated by the news reports which deceived the customers…

18. How much profit did they make
 Melrose.com brought in an estimated $12.5 million in
online sales in 2012, up from $10.6 million in 2011.
 Besides offering the Rolex brand, the company also
sold Breitling, Cartier, Tag Heuer and Omega along
with custom diamond jewellery.
Contd.

19.  Melrose.com is No. 614 in the 2013 Internet
Retailer Second 500 Guide. When the guide was
published in early July that year, Melrose.com was
still operating.

20. Accusations by Rolex:
 Rolex alleged Melrose made unauthorized use of the
Rolex trademark crown image in several places on
the site, and made false or misleading statements,
including in Google search ads, which read, “Rolex
watches for sale at USA’s #1 Rolex store.”
Contd.

21.  Rolex gathered evidence for its lawsuit by having
executives order three Rolex watches from the
Melrose.com site in early 2012, according to Rolex's
complaint filed in court.
 Rolex said it found that many parts of the watches
were not genuine, and that Melrose’s watches bore
counterfeit copies of the Rolex trademark.
Contd.

22.  Additionally, Rolex alleged that Melrose.com owned and
operated six parking sites (websites) rolexgiveaway.ca,
rolexblogsite.com, rolexblogsite.net,
rolexwatchforum.com, rolexwatchforum.net,
rolexwatchforums.com and rolexwatchforums, that
incorporated the Rolex trademark to specifically provide
links and drive traffic to Melrose.com, none of which
were authorized by Rolex.
Contd.

23.  Rolex concluded that the defendant's actions
constituted false designations of origin for commerce,
false descriptions and unfair competition because
such designations and representations tend to falsely
describe and/or represent the defendant's counterfeit
watches and watch parts as those of Rolex in
violation of the Lanham Act, according to the suit.

24. Melrose’s response:
 The company's president, Krishan Agarwal, told
the Los Angeles Times that Melrose.com sells "pre-
owned" watches and restores Rolex watches among
others but it does not include counterfeit parts with
those repairs. He said the company "will be
vehemently defending the lawsuit and our right to
resell used authentic goods."

25. Seeking justice:
 Rolex sought an injunction, ordering Melrose.com to
refrain from using any reproduction, counterfeit, copy
or colourable imitation of the Rolex trademarks to
identify any goods or the rendering of any services
not authorized by Rolex.
Contd.

26.  The judge ruled that Melrose’s actions constituted,
“trademark counterfeiting under 15 U.S.C. 1114,
trademark infringement under 15 U.S.C. 1114, and
false designation of origin, false description, and
unfair competition under 15 U.S.C. 1125,” court
documents show.
Contd.

27.  The judge ordered Melrose and its founder Krishan
Agarwal to permanently take down the Melrose.com
website and any others containing the term “Melrose.”
 The company was also ordered to pay Rolex $8.5
million in damages; hand over the domain name
Melrose.com and all international versions of the site;
and deliver to Rolex all watch heads bearing its name.
Contd.

28.  Rolex sought damages for of up to $100,000 per
domain name, the costs and disbursements of the
legal action, attorney and investigator fees and
prejudgment interest along with punitive damages.

29. "Melrose and Rolex settled the case
amicably out of court and I’ve left the
industry," said founder Krishan Agarwal.
Krishan Agarwal
Founder, Melrose Inc

30. References:
 https://www.internetretailer.com/2013/11/13/e-
retailer-melrose-shut-down-violating-rolex-trademark
 http://www.diamonds.net/News/NewsItem.aspx?Artic
leID=40837
 http://www.prweb.com/releases/rolex-
watches/melrose-com/prweb10544336.htm
 www.youtube.com/watch?v=lhz-BqpVPBg

31. Thank You