Byron Bay data breach victim has Adidas case dismissed in US court, NBA action looms

Byron Bay data breach victim has Adidas case dismissed in US court, NBA action looms
  • PublishedDecember 6, 2023

Cyber criminals gained unauthorised access to Sarah Luke’s PayPal account in December last year to trade hundreds of counterfeit items, including merchandise from Adidas and the National Basketball Association (NBA).

Adidas and the NBA then filed claims in courts in Florida and Illinois relating to trademark infringement totalling $1.8 million, and Ms Luke was found liable without even being aware of the charges.

In court documents seen by the ABC, the damages involved $293,000 ($US200,000) in the NBA case and $1.5 million ($US1million) in the Adidas matter.

Now, an application by Adidas to have the order against her dismissed has been accepted by a US District Court of Florida judge.

“It can’t be taken back or refiled, it’s basically abolishing me of any liability,” Ms Luke said.

“It is pretty amazing.”

Attention turns to NBA case

After international publicity generated by the ABC’s story in July, Ms Luke received assistance from a global digital security company to fund a US attorney to negotiate with the two sportswear giants.

A woman with blonde hair sits at a table with a laptop and documents strewn about. She is reading something on a piece of paper.
Sarah Luke says the legal action is taking a toll on her family emotionally and financially.(ABC North Coast: Hannah Ross)

She said her US attorney had decided to first tackle the Adidas matter in Florida, before turning their attention to the NBA matter in the US state of Illinois.

“That creates a blueprint that they can take to the NBA and try to achieve the same outcome,” she said.

“They will be approaching the attorneys of the NBA to file a notice of dismissal to the court of Illinois.

“Hopefully, fingers crossed, we have the same outcome, but who knows.”

Ms Luke said the past 12 months since the fraudulent transactions had been stressful.

“I’m chuckling today because it’s so ridiculous,” she said.

“But a couple of days ago when I got the order dismissing me I was in floods of tears.

“It’s a whole range of emotions from overwhelm and frustration to relief mixed with joy.”

Ms Luke said she was optimistic about the NBA case.

“Now that we have got this blueprint to work with … maybe there will be a positive outcome and I’ll have all of the charges removed against me,” she said.

“It’s been a bizarre case up to this point, if another bizarre turn of event happens, I wouldn’t be surprised.”

Government support ‘ideal’

Ms Luke also had the help of private investigators who specialise in responding to cybercrime.

Cybertrace chief executive Dan Halpin said his team helped compile evidence of how Ms Luke’s account may have been compromised and she was not responsible for the fraudulent transactions.

He said it was an unusual case, but this type of activity was becoming more common.

“Most people don’t believe that it’s going to happen to them, and especially not to the extent which has happened with Sarah,” he said.

“This is the first time we’ve seen it go this far and this is again an indication of the direction cybercrime is going.”

Mr Halpin said there needed to be support from government to assist people who could show they were a victim in significant cases of cybercrime.

“Ideally we need to have a body, a government body, that is there for victims and who can represent them if they’re able to demonstrate sufficiently that … this is my account but clearly I wasn’t in control of this account,” he said.

“Government can then take over and make representations to that court system, wherever that is.”

Adidas in a statement said it “rigorously protects and enforces its intellectual property rights against counterfeiters. In the case of Sarah Luke, we immediately instructed PayPal to release her funds on February 21, 2023, after receiving the note that Sarah Luke claimed identity theft on the same day.” 

Adidas gave no further explanation as to why Ms Luke faced a hefty fine in a Florida court.


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