On Wednesday, January 13, 2016, Judge James DeLuca sustained racketeering and fraud claims against NFL quarterback Eli Manning and New York Giants’ equipment manager Joseph Skiba in relation to the 2014 action brought by Eric Inselberg, alleging that Manning and the New York Giants were distributing fake sports memorabilia. While Judge DeLuca sustained the racketeering and fraud claims, he dismissed several other claims alleged by Inselberg.
Eric Inselberg, a memorabilia dealer, brought suit in January of 2014, accusing the New York Giants of engaging in the distribution of fraudulent team merchandise. The suit stemmed from an indictment against Inselberg a few years earlier, when he faced federal charges for selling counterfeit jerseys in 2011. The case against Inselberg was eventually dropped but he filed the present action alleging that the NFL team was at fault for the demise of his business. Among his accusations, Inselberg alleged that Manning, his company PWL, Inc. and equipment manager Joseph Skiba sold merchandise on the market, falsely claiming it to be “game-worn” by Manning.
Judge DeLuca provided a 63-page opinion, dismissing several of Inselberg’s claims alleging that the defendants contributed to his indicted by lying to authorities. These allegations were dismissed on Judge DeLuca’s finding that they were pled without sufficient evidence or were based on testimony protected by absolute privilege.
However, Judge DeLuca refused to dismiss Inselberg’s claims against the defendants for racketeering in violation of the Consumer Fraud Act (CFA). The defendants attempted to argue that they could not be held liable for such claims because they are not direct sellers and the products’ warranties free them from counterfeiting claims. The judge was not convinced, stating, “[t]he court finds unpersuasive the argument that plaintiffs were obligated to pursue warranty remedies and seek a return of their money before bringing a claim under the CFA . . .[p]laintiffs expected that they would be the owners of game-worn helmets. To permit defendants to simply refund monies rather than provide the unique memorabilia would deprive plaintiffs of the benefit of the bargain.”
Judge DeLuca also sustained a common law fraud claim against the defendants as well as a negligent misrepresentation claim against Manning and the company that allegedly authenticated the merchandise — Steiner Sports Memorabilia.