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Trademark infringement is knowingly manufacturing or distributing items with a counterfeit trademark. Possession of 25 or more items is assumed to be with intent to distribute. Enforcement protects consumers and requires registration. Fines vary based on the value and volume of counterfeit goods, with possible prison sentences.
Trademark infringement is defined as any knowingly manufacturing, distributing or intending to distribute items bearing a counterfeit trademark. The item will be considered a counterfeit mark if it contains a mark which identifies it as coming from a source normally associated with the distribution of the product, but in fact does not come from that source. In general, anyone in possession of 25 or more items bearing a counterfeit trademark is assumed to possess those items with the intent to distribute them.
Enforcement of trademark counterfeiting laws is intended to protect potential consumers, as is the case with all trademark policies. While trademark law generally extends protection to trademarks that have not been registered as long as they have been used in commerce, enforcement of trademark counterfeiting laws is conditional on that trademark having been registered with the government office. This provides an extra incentive for trademark owners to register their trademarks.
Finding an intent to distribute is often an essential element in establishing a trademark infringement claim. Intent to distribute generally requires a subjective determination based on the facts at hand, although possession of 25 or more of a particular item is a common benchmark across regions. Of course, this number may change depending on the surrounding circumstances and the type of item. If the item is something people don’t typically have on hand in large numbers, it will be easier for the prosecutor to prove intent to distribute it.
Benchmarks vary from region to region, but the cumulative value of the items usually determines the level of the fine. If the cumulative value of the goods bearing the counterfeit mark is low, the crime is typically considered a felony. It can be considered a crime of the second or third degree if the cumulative value of the products bearing the counterfeit trademark is significant.
Often, the benchmarks for determining fines will be the volume of counterfeit goods. In other words, the more counterfeit items the alleged forger has, the higher the penalties. Typically, there will be a fine with the possibility of serving a prison sentence of up to one year, although judges have discretion to vary the penalties based on the facts egregious. Furthermore, objects bearing counterfeit brands will be seized by the competent authorities.
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