DoJ takes no action in Bethany surf-shop shirt situation

Bethany Beach Surf Shop owner Jim McGrath has a folder in his store that he says documents more than 300 instances of “confusion” between his store and another business in town.

McGrath says the folder contains evidence that the other business is selling “bootleg” T-shirts that use a logo very similar to the one on shirts he sells at the business he has owned for 36 years.

He recently contacted the Delaware Department of Justice and requested help in stopping the other business, located on the Bethany Beach boardwalk south of Garfield Parkway, from selling the look-alike shirts.

Earlier this week, he learned that, despite an investigation by the state Consumer Affairs Office, no action will be taken against the other business at this time. The Coastal Point received confirmation from Department of Justice spokesman Carl Kanefsky that an investigation did take place and that “the matter is being closed without further investigation.”

Although he is frustrated by the decision, McGrath said, “This does not surprise me one bit.” He said the owner of the other store is “clever. He knows where the loopholes are.” He said he has pursued legal action regarding the “bootleg” shirts, which show a logo similar to that of the Bethany Surf Shop with the additional words “beach” and “hut” in smaller letters — and some apparently with “Bethany” spelled incorrectly, he said — several times in recent years.

“When I see someone wearing one of his shirts, to me, that’s stealing,” he said.

McGrath said he is in a unique situation with the bootleg shirt issue, partly because, with his two Bethany Beach shops — the original one on Garfield Parkway and a newer one on Route 26 — he doesn’t have the resources of larger companies whose products are often imitated, and in addition, his prime selling season is so short that, by the time action would be taken, the season is over.

“I don’t see how he walks up and down the street” — sometimes even wearing the alleged knockoff shirts — McGrath said of the other store’s owner.

“I guess I gotta live with it,” he said of the State’s decision not to act. McGrath, however, does not plan to give up his fight against what he feels is unfair use of a logo he has built into a recognized brand over nearly four decades in business.“I’m not gonna sit back. I’m gonna do what I have to do,” he said.

Although he knows it will cost him dearly in both time and money, McGrath acknowledged that the next step in his fight might be filing a lawsuit against the other owner in civil court.

Eric Efergan, owner of the boardwalk business called Bethany Beach Hut Surf Shop, said, “I’m not copying his merchandise,” adding that his shirts are printed with “Beach Hut” as part of the logo, which he said differentiates it from the Bethany Surf Shop.
“There’s nothing to pursue,” he said, in reference to the state justice department’s decision not to take action against him. “In his eyes, he thinks it’s too close to his shop [logo]. Nothing that I carry looks like his stuff,” Efergan said.

“This guy is obsessed with my store,” he said, adding that he plans to file a lawsuit against McGrath. “He’s bad-mouthing me. I never talk bad about his store.”

Efergan said he has owned the boardwalk business for 17 years and also owns two other businesses in Bethany Beach.
Meanwhile, McGrath said that his folder full of “confusion” incidents will come in handy for any future action, he said, because under Delaware law, confusion between one business and another is one of the major criteria for seeking redress.

“We have had over seven people, just in the last week, come in to exchange or return t-shirts purchased from the retail bottom-dweller,” he said in a June 8 letter to Attorney General Matt Denn.

McGrath said that even the Bethany Beach Police Department appears to be confused about the other business, since they recently came into his shop looking for an employee of the other one. In the June 8 letter, he also cited a phone call from a woman who said she was calling about her son’s paycheck — although he apparently worked for the other business — as another example of the types of issues he deals with regularly.

“Every time somebody comes in here and they are confused, we document it,” he said.