Chinese online retail giant Alibaba has filed a lawsuit against a firm based in Dubai accusing it of causing confusion by making use of its trademarked name and brand to raise over $3.5 million in an Initial Coin Offering of a digital currency called Alibabacoin (ABBC). In the lawsuit Alibaba indicated that Alibabacoin Foundation used the e-commerce giant’s trademarks prominently, repeatedly and intentionally in order to mislead and confuse consumers into thinking that its products were endorsed by or affiliated with the Chinese online retail giant.
After the filing of the lawsuit a U.S. District Judge directed Alibabacoin to field an explanation on April 11 giving reasons why the suit should not be continued. In the lawsuit Alibaba is seeking to have further infringements halted. Alibaba is also seeking punitive, compensatory and triple damages over the alleged violation of New York and federal law.
Reputation for success
According to the complaint by Alibaba, the Dubai-based firm has capitalized on the reputation for success of the former without alteration with a view to selling digital assets. In the past Alibaba has insisted that it has no intentions of getting into the virtual currency space but the actions of Alibabacoin Foundation have only heightened the confusion. Alibabacoin Foundation has however taken no measures to correct or combat the confusion.
“[The] defendants prominently feature trademarks owned by Alibaba Group Holding, in whole and without alteration, in countless instances in materials they make publicly available on the internet, including in offering materials that solicit investment from investors in the U.S. and elsewhere,” the lawsuit reads.
While announcing the kicking off of its Initial Coin Offering Alibabacoin Foundation indicated that it had more than 100 employees spread across the world who were developing its blockchain system. One of the products the foundation was allegedly developing was a multi-cryptocurrency wallet. In an official statement the entity indicated that that it was making use of the X13 algorithm to ensure safer and faster transactions.
To participate in the ICO Alibabacoin Foundation indicated on its website and other communication channels that it would be accepting Bitcoin (BTC), Bitcoin Cash (BCH), Litecoin (LTC), Ripple (XRP), Ether (ETH), Dash (DASH) and Qtum (QTUM).