On Monday, April 2nd, Chinese e-commerce giant Alibaba Group (NYSE:BABA) filed a complaint alleging various trademark claims in the Southern District of New York. Alibaba alleges that defendant Alibabacoin (ABBC) Foundation has engaged in an unlawful scheme to misappropriate the Alibaba name in order to raise over $3.5 million in cryptoassets from investors. The complaint alleges that scheme was a part of an Initial Coin Offering (ICO) that is neither registered nor approved by U.S. regulators.
Although cryptocurrency firm ABBC Foundation itself is headquartered Dubai, Alibaba argues that U.S. district court is the proper venue for this case as ABBC has advertised that its Alibabacoin cryptocurrency will be available on various crypto-trading platforms which are based in New York, including Gemini and itBit. Alibaba notes that it holds several trademarks registered with the U.S. Patent and Trademark Office, including:
- U.S. Trademark Registration No. 2589009, which protects the use of the standard character mark “ALIBABA.COM” for business services including facilitating the transaction of business via local and global computers.
- U.S. Trademark Registration No. 2829317, which protects the use of the standard character mark “ALIBABA” for use in computer software, including for use in exchanging information via global computer networks and online from a computer database and the Internet.
- U.S. Trademark Registration No. 2579498, which also covers the mark “ALIBABA” for use in providing an interactive website on a global computer network for third parties to post information, respond to requests and fulfill orders.
Alibaba’s suit also included a series of federally registered trademarks covering the design of the Alibaba logo, as well as the use of that design for use in conjunction with “Alibaba Group” wording.
In its complaint, Alibaba alleges that Alibabacoin, a cryptocurrency making use of facial recognition technology to complete transactions, uses “ALIBABA” in various contexts on its website, including the standalone use of “ALIBABA” on an image found on the defendant’s website. Alibaba also notes other uses of its trademarks in the white paper explaining ABBC Foundation’s cryptocurrency technology, where there are multiple mentions of an “Alibaba Coin” including a space between the two words.
The promotion of Alibabacoin has already caused consumer confusion as to the origin of the coin product, according to allegations in the suit. Alibaba suit cites to a few articles from cryptocurrency publications reporting a link between Alibabacoin and the Chinese e-commerce giant. Alibaba also attached an interview given by ABBC Foundation CEO Jason Daniel Paul Philip where he was asked point blank if ABBC was linked to Alibaba, to which he replied, in part, “I cannot tell you anything about this for now.” Alibaba contends that ABBC Foundation and its CEO have further created consumer confusion with by announcing intentions to open an online store and move into the e-commerce space.
Alibaba’s complaint includes seven causes for action including federal trademark infringement, federal false designation of origin violations, federal false advertising violations and federal trademark dilution as well as counts under New York State law for trademark infringement, unfair competition and trademark dilution. Alibaba seeks a permanent injunction enjoining the defendants from using the Alibaba marks as well as monetary relief in the form of compensatory damages, punitive damages and trebled damages based on defendants’ profits.