[1][2][3] This scheme, frequently used by trademark owners, involves intellectual property rightsowners filing a lawsuit against multiple online merchants using a sealed complaint that does not publicly identify the defendants.
The rightsowners then seek an ex-parte temporary restraining order (TRO) directing the online marketplaces to freeze the defendants' accounts and funds.
[7] Moreover, it exploits gaps in the legal system's efforts to ensure due process, raising questions about its fairness and effectiveness.
[4][8] After filing the complaint with the sealed Schedule A, rightsowners request a temporary restraining order (TRO) without the defendants’ knowledge or presence.
[7][14] The freeze also costs the defendants money from lost sales and may leave them without sufficient cash flow to retain an attorney to represent them in court.
[14][18][19] Despite Harness being notified of the lawsuit via email, this notification landed in her spam folder,[18] and she remained unaware of the proceedings until receiving notice of the $250,000 judgment.