Trademark infringement is a violation of the exclusive rights attaching to a trademark without the authorization of the trademark owner or any licensees (provided that such authorization was within the scope of the license). Infringement may occur when one party, the “infringer”, uses a trademark which is identical or confusingly similar to a trademark owned by another party, in relation to products or services which are identical or similar to the products or services which the registration covers. An owner of a trademark may commence legal proceedings against a party which infringes its registration.

In many countries, but not in the United States, which recognizes common law trademark rights, a trademark which is not registered cannot be “infringed” as such, and the trademark owner cannot bring infringement proceedings. Instead, the owner may be able to commence proceedings under the common law for passing off or misrepresentation, or under legislation which prohibits unfair business practices. In some jurisdictions, infringement of trade dress may also be actionable.

Where the respective marks or products or services are not identical, similarity will generally be assessed by reference to whether there is a likelihood of confusion that consumers will believe the products or services originated from the trademark owner. If the respective marks and products or services are entirely dissimilar, trademark infringement may still be established if the registered mark is well known pursuant to the Paris Convention. In the United States, a cause of action for use of a mark for such dissimilar services is called trademark dilution.

In some jurisdictions a party other than the owner (eg. a licensee) may be able to pursue trademark infringement proceedings against an infringer if the owner fails to do so.

The party accused of infringement may be able to defeat infringement proceedings if it can establish a valid exception (e.g. comparative advertising) or defence (e.g. laches) to infringement, or attack and cancel the underlying registration (eg. for non-use) upon which the proceedings are based.

Federal District Court Opinions (Court Case)

A.V. BY VERSACE, INC. v. VERSACE, (S.D.N.Y. 2006) A.V. BY
VERSACE, INC., Plaintiff, v. GIANNI VERSACE S.p.A. and
ALFREDO VERSACE, Defendants. GIANNI VERSACE S.p.A.,
Plaintiff, v. ALFREDO VERSACE and FOLDOM INTERNATIONAL
(U.S.A.), INC., Defendants. GIANNI VERSACE S.p.A.,
Plaintiff, v. ALFREDO VERSACE, L’ABBIGLIAMENTO, LTD. ET AL.
Defendants. 96 Civ. 9721 (PKL) (THK), 98 Civ. 0123 (PKL)
(THK), 01 Civ. 9645 (PKL) (THK). United States District
Court, S.D. New York. August 30, 2006. Page 2

Elizabeth A. Adinolfi, Esq., PHILLIPS, NIZER, BENJAMIN,
KRIM & BALLON LLP, New York, New York, Attorneys for
Plaintiff Gianni Versace S.p.A.

Leonard Zack, Esq., LEONARD ZACK & ASSOCIATES New York,
New York, Attorney for Defendant Alfredo Versace. Page 3

OPINION AND ORDER

PETER LEISURE, District Judge

This litigation between Gianni Versace S.p.A. (“Gianni”)
and Alfredo Versace (“Alfredo”) arose in December 1996 in
connection with defendant Alfredo’s infringing use of
certain Versace trademarks. Since that time, the Court has
issued more than a dozen decisions, including several
findings of contempt against Alfredo. Nearly a decade
later, the case still lumbers forward. On January 24, 2005,
the Court granted Gianni’s request for the entry of a
permanent injunction against Alfredo similar in all
material respects to the modified preliminary injunction
that had been in force since January 27, 2003 (the
“Modified Preliminary Injunction”). See A.V. By Versace,
Inc. v. Versace, Nos. 96 Civ. 9721, 98 Civ. 0123, 01 Civ.
9645, 2005 WL 147364, at *8 (S.D.N.Y. Jan. 24, 2005). On
January 12, 2006, the Court signed the permanent injunction
(the “Permanent Injunction”). Meanwhile, Gianni has moved
the Court to hold Alfredo in further contempt for
continuing and ongoing violations of the Modified
Preliminary Injunction. Specifically, Gianni requests that
the Court refer the matter to the United States Attorney’s
Office for investigation into whether Alfredo has committed
perjury before this Court. For the reasons set forth
herein, Gianni’s motion is granted. Page 4

BACKGROUND

I. The Consolidated Actions

The factual and procedural background of these
consolidated actions has been set forth in the Court’s
numerous decisions, with which the Court presumes
familiarity. See A.V. By Versace, Inc. v. Gianni Versace,
S.p.A., Nos. 96 Civ. 9721, 98 Civ. 0123, 01 Civ. 9645, 2006
WL 90062 (S.D.N.Y. Jan. 12, 2006); A.V. By Versace, 2005 WL
147364; A.V. By Versace, Inc. v. Versace, S.p.A., Nos. 96
Civ. 9721, 98 Civ. 0123, 2004 WL 691243 (S.D.N.Y. Mar. 31,
2004); Gianni Versace, S.p.A. v. Versace, No. 01 Civ. 9645,
2003 WL 22023946 (S.D.N.Y. Aug. 27, 2003); Gianni Versace,
S.p.A. v. Versace, No. 01 Civ. 9645, 2003 WL 470340
(S.D.N.Y. Feb. 25, 2003); A.V. By Versace, Inc. v. Gianni
Versace, S.p.A., Nos. 96 Civ. 9721, 98 Civ. 0123, 2002 WL
2012618 (S.D.N.Y. Sept. 3, 2002); A.V. By Versace, Inc. v.
Gianni Versace, S.p.A., 191 F. Supp. 2d 404 (S.D.N.Y.
2002); A.V. By Versace, Inc. v. Gianni Versace, S.p.A.,
160 F. Supp. 2d 657 (S.D.N.Y. 2001); A.V. By Versace, Inc.
v. Gianni Versace, S.p.A., 126 F. Supp. 2d 328 (S.D.N.Y.
2001); A.V. By Versace, Inc. v. Gianni Versace, S.p.A., 87
F. Supp. 2d 281 (S.D.N.Y. 2000); A.V. By Versace, Inc. v.
Gianni Versace, S.p.A., No. 96 Civ. 9721, 1998 WL 832692
(S.D.N.Y. Dec. 1, 1998); A.V. By Versace, Inc. v. Gianni
Versace, S.p.A., No. 96 Civ. 9721, 1997 WL 31247 (S.D.N.Y.
Jan. 28, 1997). Page 5

This case consists of three separate actions which have
been consolidated by the Court. In December 1996, A.V. By
Versace (“A.V.”), a corporation claiming to hold a license
to use certain Versace trademarks, commenced an action
seeking injunctive relief and damages against Gianni and
Alfredo after Gianni had sent a cease-and-desist letter to
one of A.V.’s vendors. See A.V. By Versace, 1997 WL 31247,
at *1. Gianni cross-claimed against Alfredo for a
declaration regarding the manner in which Alfredo could use
the Versace surname in the future. See A.V. By Versace,
1998 WL 832692, at *1. In January 1998, Gianni filed a
separate lawsuit against Alfredo and Foldom International
(U.S.A.), Inc. (“Foldom”), alleging trademark infringement,
unfair competition, and trademark dilution. The Court
consolidated the 1996 and 1998 actions in December 1998.
See id. at *3.

Gianni initiated the third and final action on November 1,
2001. In that case, Gianni alleged trademark infringement
against Alfredo, L’Abbigliamento, Ltd. (“L’Abbigliamento”),
and Esrim Ve Sheva Holding Corporation, in connection with
the sale and promotion of a clothing line and watches.
Gianni settled with Esrim Ve Sheva Holding Corporation and
moved for summary judgment against Alfredo and
L’Abbigliamento. See Gianni Versace, S.p.A. v. Versace, No.
01 Civ. 9645, 2003 WL 22023946, at *1, *4 (S.D.N.Y. Aug.
27, 2003). On August 27, 2003, the Page 6 Court granted
Gianni’s motion with respect to certain claims in so far as
they sought injunctive relief, but denied summary judgment
for monetary damages. See id. at *15. On January 24, 2005,
the Court (1) consolidated the third action with the two
previously consolidated earlier actions; (2) entered
default judgments against Alfredo in the first two actions;
and (3) granted Gianni’s request for the entry of a
permanent injunction against Alfredo that would be similar
in all material respects to the Modified Preliminary
Injunction currently in force. See A.V. By Versace, Inc. v.
Versace, Nos. 96 Civ. 9721, 98 Civ. 0123, 01 Civ. 9645,
2005 WL 147364, at *15 (S.D.N.Y. Jan. 24, 2005). Finally,
as noted above, on January 12, 2006, the Court signed the
Permanent Injunction.

II. The Preliminary Injunction

On February 4, 1998, Judge Sidney H. Stein granted
Gianni’s request for a preliminary injunction against
Alfredo Versace, issuing his decision from the bench. See
A.V. By Versace, Inc. v. Gianni Versace, S.p.A., 87 F.
Supp. 2d 281, 284 (S.D.N.Y. 2000) (noting that Judge Stein
issued his decision from the bench and then issued the
preliminary injunction in writing on February 10, 1998).
The preliminary injunction entered by Judge Stein (the
“Preliminary Injunction”) barred Alfredo from, inter alia,
using or licensing the use of various “Infringing Marks”
that incorporated the name “Versace” as well as the use of
any Page 7 other trademarks confusingly similar to those
of Gianni. (Prelim. Inj. §§ 6-8, Feb. 10,
1998.) Although the injunction enjoined Alfredo from using
his name as a trademark, it allowed him to use his name to
identify goods that he had designed by use of the phrase
“Designed by Alfredo Versace” as long as such goods
prominently displayed the following disclaimer: “not
affiliated with or authorized by Gianni Versace S.p.A.”
(Prelim. Inj. §§ 6-10.) The Preliminary
Injunction also prohibited Alfredo Versace from delegating
or licensing his rights to a middleman. However, it allowed
manufacturers and distributors to use the name “Alfredo
Versace” in accordance with the Preliminary Injunction,
provided that they first agreed in writing to be bound by
the Preliminary Injunction. (Prelim. Inj. § 13.)

In an Opinion and Order issued on January 4, 2001 (the
“January 2001 Opinion and Order”), this Court clarified
that the Preliminary Injunction applied extraterritorially.
See A.V. By Versace, 87 F. Supp. 2d at 341.

III. The Modified Preliminary Injunction

On September 3, 2002, the Court found Alfredo in contempt
of Court because of his numerous violations of the
Preliminary Injunction. See A.V. By Versace, Inc. v. Gianni
Versace, S.p.A., Nos. 96 Civ. 9721, 98 Civ. 0123, 2002 WL
2012618, at *9 (S.D.N.Y. Sept. 3, 2002). Specifically, the
Court found that Page 8 Alfredo had been involved in the
improper sale of watches, jeans, and handbags without the
disclaimer required by the Preliminary Injunction; that
Alfredo had marketed various products featuring the
Infringing Marks on the Internet and failed to take the
steps mandated by a previous Court order to stop such
activities; and that Alfredo had been involved in a
clothing enterprise with L’Abbligiamento using Infringing
Marks and failing to use the required disclaimer. See id.
at *7-9. In addition, the Court granted Gianni’s motion to
modify the preliminary injunction to prohibit Alfredo from
using the Versace surname in any commercial context
whatsoever. See id. at *13. In so doing, the Court noted
that “the record reflects a deliberate pattern of deception
by which Alfredo Versace has repeatedly used his surname in
ways designed to create the impression that his goods are
associated with those of Gianni Versace, in violation of
judicial orders to the contrary.” Id. at *12. The Court
directed Gianni to submit a proposed modified preliminary
injunction, and ultimately signed the Modified Preliminary
Injunction on January 27, 2003. (See Modified Prelim. Inj.,
Jan. 27, 2003.)

IV. The History of Alfredo’s Contempts

The list of sanctions this Court has ordered against
Alfredo is extensive, to state the matter lightly. It was
on March 6, 2000, that the Court first found Alfredo in
civil Page 9 contempt for violating the preliminary
injunction. See A.V. By Versace, Inc. v. Gianni Versace,
S.p.A., 87 F. Supp. 2d 281, 294-95 (S.D.N.Y. 2000).
Specifically, the Court held that Alfredo violated the
preliminary injunction by using offshore Internet sites to
advertise and distribute his products in the United States.
See id. at 295. As a result of this violation, the Court
ordered Alfredo to pay Gianni the sum of one-third of its
costs and attorneys’ fees incurred in making the contempt
motion. See id. at 296.

In an Opinion and Order and Report and Recommendation
dated January 9, 2002, United States Magistrate Judge
Theodore H. Katz granted Gianni’s motion for sanctions
against Alfredo for his long-term refusal to obey three
discovery orders issued by the Court. As a sanction for his
misconduct under Rule 37 of the Federal Rules of Civil
Procedure, Magistrate Judge Katz ordered Alfredo to pay
Gianni’s costs and attorneys’ fees incurred in attempting
to secure compliance with the discovery orders, and
recommended that both Alfredo’s answer in No. 98 Civ. 0123,
and his answer and cross-claim in the related action, No.
96 Civ. 9721, be stricken. On March 21, 2002, this Court
adopted Judge Katz’s Opinion and Order and Report and
Recommendation in its entirety, essentially causing a
default for Alfredo in the instant consolidated action. See
A.V. By Versace, Inc. v. Page 10 Gianni Versace, S.p.A.,
191 F. Supp. 2d 404, 405 (S.D.N.Y. 2002).

As previously noted, on September 3, 2002, the Court again
found Alfredo in contempt for various violations of the
Preliminary Injunction. As part of this decision, the Court
warned Alfredo that a conditional jail term would be
considered if he continued to disregard the Court’s orders.
A.V. By Versace, Inc. v. Gianni Versace, S.p.A., Nos. 96
Civ. 9721, 98 Civ. 0123, 2002 WL 2012618, at *10 (S.D.N.Y.
Sept. 3, 2002) (“The Court will not impose the sanction of
a conditional jail term on Alfredo Versace at this time,
although Alfredo Versace should be aware that the Court
will consider the efficacy of such a severe sanction if his
transgressions continue.”) Despite this clear warning,
Alfredo’s contumacious conduct continued. On August 28,
2003, the Court found that Alfredo had failed to purge
himself of contempt, and that there existed new bases for
holding Alfredo in further contempt. A.V. By Versace, Inc.
v. Gianni Versace, S.p.A., 279 F. Supp. 2d 341 (S.D.N.Y.
Aug. 28, 2003). Alfredo’s new transgressions included the
delivery of bottled water with labels that included the
word “Versace” and Alfredo’s continued use of the business
name “Versace Boutique.” Id. at 352-53. The Court wrote
that its “patience, while drawing quite thin, endures,” and
that “Alfredo will now have one last chance to avoid a
conditional jail term.” Page 11 Id. at 355. Accordingly,
the Court gave Alfredo sixty days to purge himself of his
contempt, and informed Alfredo that if he did not do so,
“the Court will order his immediate imprisonment until such
time as he is in compliance.” Id. at 355. Astonishingly,
Alfredo once again failed to obey a directive of this
Court. On March 31, 2004, the Court ordered Alfredo to
surrender to the United States Marshall for a term of civil
commitment until he had complied with the requirements of
the August 28, 2003, Order. A.V. By Versace, Inc. v.
Versace, S.p.A., Nos. 96 Civ. 9721, 98 Civ. 0123, 2004 WL
691243, at *1 (S.D.N.Y. Mar. 31, 2004). Alfredo avoided
imprisonment on this occasion through a stipulation by the
parties setting forth specific steps Alfredo would take to
purge himself of contempt. (See Stip., May 17, 2004.) The
stipulation included the desperate measure of an agreement
by Alfredo’s wife, Frances Versace, to take out a
home-equity loan on her residence in an effort to satisfy a
portion of the outstanding judgments against Alfredo.
(Stip., May 17, 2004.)