Court Rejects Antitrust Allegations in Luxury Dispute Between Chanel and The RealReal

According to a statement in the court’s March 26 order, U.S. District Judge Vernon S. Broderick ruled that The RealReal’s antitrust and related claims were largely either time-barred or failed to meet the legal standard required to proceed. The decision allows the reseller to seek permission to amend certain claims but effectively eliminates the bulk of its antitrust strategy.

The case, which has been ongoing since 2018, centers on Chanel’s allegations that The RealReal sold counterfeit goods and misled consumers about its authentication processes. Chanel maintains that the reseller marketed products as genuine without sufficient expertise and failed to clarify that Chanel is not affiliated with its authentication efforts.

The RealReal, in response, has argued that Chanel engaged in anticompetitive behavior aimed at restricting the secondary luxury market. Per a statement in the filings, the reseller alleged that Chanel interfered with advertising opportunities, entered exclusive partnerships, and promoted the idea that only Chanel could authenticate its products.

However, the court found that many of these allegations stemmed from events dating back to 2015 and early 2016. According to a statement in the ruling, such claims fall outside the applicable statutes of limitations, which are four years for antitrust violations and three years for tortious interference. As a result, the court determined that any related claims are barred.

The RealReal also attempted to argue that Chanel’s conduct constituted a continuing violation, thereby extending the limitations period. The court rejected this argument, stating that the reseller failed to identify new and independent actions that would restart the legal clock, instead relying on earlier conduct.

In addressing more recent allegations, the court dismissed claims involving advertising disputes with Women’s Wear Daily and Chanel’s relationship with Farfetch. According to a statement, the court found that The RealReal did not provide sufficient factual support to demonstrate any agreement or actionable anticompetitive conduct. It also concluded that the reseller failed to show harm to overall market competition, a key requirement for antitrust claims.

Despite these setbacks, The RealReal did secure a limited victory. The court declined to strike its “unclean hands” defense, noting that Chanel had prior notice of the argument but delayed in challenging it. Per a statement in the ruling, this defense—based on allegations of Chanel’s conduct in the secondary market—will remain part of the case moving forward.

The broader implications of the decision highlight the challenges companies face when attempting to frame resale disputes as antitrust violations. According to a statement in the order, such claims must not only be timely but also demonstrate concrete harm to competition rather than to a single competitor.

With the case now proceeding after a lengthy pause and unsuccessful settlement efforts, Chanel’s core claims—including trademark infringement and unfair competition—remain active, while The RealReal’s narrowed defense will continue to be tested in court.

Source: The Fashion Law