The unauthorised use of a registered trademark is a criminal offence (under the Trade Mark Act 1994), which means that anyone who is in possession of, or distributes, goods that bear a sign identical to (or likely to be mistaken for) a registered trade mark may face a real risk of prosecution.
Local authorities’ Trading Standards teams are primarily responsible for enforcing trade mark infringement prosecutions and take matters of infringement seriously. Not only does the sale of counterfeit goods have the potential to damage businesses and the national economy, the goods themselves also pose safety risks to those who purchase them.
For these reasons, prosecutions for trademark offences must be treated with caution. Possession of a small number of counterfeit items may lead to a community order with more serious cases carrying the potential for a prison sentence of up to ten years and/or an unlimited fine. Furthermore, the fact that a person has been criminally convicted is admissible evidence in any subsequent civil proceedings, which could include actions for damages by the infringed party.
What is a trademark?
A trademark is any sign capable of being represented graphically, which distinguishes the goods or services of one company from those of another. Typically they consist of words, personal names, designs, letters numerals or a distinctive packaging or product shape.
The offences under the Trade Mark Act 1994 also extend to the import and selling of ‘grey goods’. These are items that are not counterfeit, but which are marketed or imported into the UK through improper distribution channels by individuals who have no authorised relationship with the ordinary manufacturer of the trademarked products.
Examples of offences
A person will commit a TMA offence where they are in possession of, or distribute, goods that bear a ‘sign’ that is identical to, or likely to be mistaken for, a registered trade mark. The act also criminalises the application of a trademarked sign to goods.
In the same way as most fraud offences, it must also be shown that the person charged acted with a view to make a gain or with an intent to cause loss to another.
The definition contained within the legislation is a broad one that applies equally to individual operations (for example eBay sellers and market-stall traders) and companies. Individual directors, managers and other officers of a company, who are directly involved in the production or distribution of counterfeit products by that company can also be prosecuted alongside the company.
In proven cases the court may impose custody of up to 10 years (or up to 6 months in the Magistrates’ Court), and an unlimited fine. Additionally the court will normally order that any counterfeit goods or packaging be destroyed.
- In February 2018 a defendant in central Wales pleaded guilty to two TMA charges for offering to supply counterfeit Timberland boots and Ralph Lauren tracksuits on Facebook.
- Paul Michael Foster was convicted following an investigation by Staffordshire Trading Standards found that he was buying counterfeit DVDs from China and selling them on to customers worldwide as genuine through eBay. He was sentenced to 16 months imprisonment in January 2016. At a confiscation hearing in February 2018 Mr Foster was ordered to pay back £567,000 in proceeds and prosecution costs of £36,858.72.
- A Peckham trader who was in possession of more than 600 fake iPhone charger plugs was given a 12 month community order with 120 hours of unpaid work after a crackdown on counterfeit electronics by Southwark Council due to safety concerns. Mr Rahaman’s company, Safi Electronics and Communications, was fined a further £1,500 at Camberwell Green Magistrates’ Court on 12th December 2017.
- Pawel Ostoweicki and his company, VX Car Limited, were found guilty of multiple breaches of the TMA in November 2017, for selling counterfeit car parts and accessories from China bearing the logos of BMW, Mercedes-Benz and Ford. Mr Ostoweicki received a suspended prison sentence and a community order of 250 hours unpaid work. He was also ordered to pay £12,000 in costs.
How can Blaser Mills Law help?
There are defences available under the TMA where a person charged can demonstrate that they held a reasonable belief that the use of the sign or mark was not an infringement of the registered trademark, or that they believed the goods to be genuine.
If you or your business has received notification of any action regarding trademark infringement then contact us today for pragmatic advice on how to deal with it on email@example.com
We are a multi-disciplinary law firm with expertise in commercial litigation, IP and criminal law.