How Trademark Infringement Can Lead to Criminal Penalties

What is a Trademark Infringement Violation?

Trademarks and other copyright tools are essential for protecting your interests in intellectual properties (IPs) and brand image from those seeking to exploit or damage your brand for personal gain. Any unauthorized use of a company trademark (or a distressingly similar trademark) could have profound legal and business implications. If you have been accused of a trademark violation, you must seek professional legal counsel to represent your interests in pursuit of a favorable outcome.

Even those wrongfully accused of trademark infringement can face serious consequences, including the potential cost of rebranding. It is crucial to have dedicated legal advice to help you through these dire circumstances.

Trademark infringement violations occur when unauthorized parties use a trademark identical to or confusingly similar to a registered mark. This can lead to consumer confusion and cause financial blowback to the trademark holder. Although there may be certain exceptions in a case-by-case basis, proving trademark infringement generally requires showing that the victim or plaintiff owns the trademark in the case, the person accused of abusing the mark had access to the IP, that the accused infringer took advantage of their access to the IP without express permission, and that there were no exceptions that allowed for such use of the IP.

In Florida, common issues that lead to trademark infringement litigation include trademark similarities, cybersquatting (registering online domain names to profit from another brand), counterfeiting, dilution of trademarks, and the unauthorized franchising or licensing of a registered mark.

Specific legal defense strategies could be employed when accused of trademark infringement. Please get in touch with a lawyer with experience representing these practice areas for assistance defending your interests and escaping the harsh legal consequences of a criminal conviction.

What Are the Potential Legal Penalties for Trademark Violations?

The legal consequences for trademark infringement were designed to defend the trademark holder’s rights and encourage competition on the fair market. These penalties can dramatically impact the accused’s financial standing and reputation. Trademark and copyright infringement offenses are examples of serious white-collar crimes.

Potential penalties and punishments that could befall an accused infringer include the following:

•   Financial damages, including lost profits, that could be over $100,000 per infringement
•   Injunctions to permanently halt the unauthorized use of protected material
•   A potential lengthy prison sentence for the infringer
•   Restitution for attorney legal fees and court costs that the trademark holder must pay

Several factors influence the extent of the penalties for patent, copyright, or trademark violations. These factors can include state and federal laws, the amount of harm experienced by the plaintiff, and the exact nature of the infringing actions.

Are There Other Consequences to Be Aware Of?

In addition to the potential legal consequences of trademark violations for the infringer, other potential damages could affect you and your company brand. In many cases, companies found guilty of trademark violations must rebrand their products, services, and sometimes their entire business models to meet the courts’ demands.

Rebranding can result in extreme financial hardships related to developing new trademarks, updating marketing materials, changing packaging, and shifting advertising focus to the new target markets.

Additionally, the infringing company’s reputation and market standing are likely to suffer due to trademark violations, which can result in a loss of customers, a decrease in sales, and negative impacts on relationships with suppliers, business partners, and distributors.

When Does Trademark Infringement Rise to the Level of a Criminal Offense?

In many trademark violation cases, the infringing party is required to pay damages and restitution and abide by injunctions to meet the demands of the courts overseeing their case. However, in certain circumstances, the infringing party could be charged and convicted of criminal infringement of someone else’s intellectual property through trademark infringement, which can result in even more severe consequences, such as up to a decade in prison and fines of up to $2,000,000.

The key factor determining whether trademark infringement is a federal crime and not just a civil violation depends largely upon whether there was a deliberate intent to steal and profit from another party’s protected IP. Then, the severity of the criminal offense would be measured by the profit obtained through the infringing practice. 

The Lanham Act identifies criminal trademark infringement, primarily focusing on intentional counterfeiting and piracy efforts. Under the law, it is a criminal offence to intentionally counterfeit trademarked material in connection with the sale, offering for sale, or distribution of goods and services. This criminal act becomes a federal crime when it becomes capable of deceiving consumers or causing mass confusion. The law also makes it a crime to intentionally traffic in goods or services knowingly using counterfeit marks or in connection with such goods or services, such as using someone else’s trademark.

How to Avoid Trademark Infringement Claims?

Businesses and business owners are encouraged to take certain precautions to prevent unintentional trademark infringement. 

Before adopting a new brand name or image, conduct a thorough trademark search using the provided databases and common law searches to identify existing trademarks. Additionally, you should consult with an attorney experienced in trademark law for legal guidance on registering and protecting a valid trademark. 

Companies are encouraged to ensure that their trademarks are unique and distinct from their competitors, using clear branding strategies to stand out from the pack. You should monitor your trademark regularly and see how it is used in the marketplace, and be watchful of those who seek to infringe upon your intellectual property. 

You must respond if another business sends a cease and desist letter. You cannot simply ignore a cease-and-desist letter. If you have received such a letter, contact a lawyer for legal assistance. 

Schedule a Free Case Evaluation with an Experienced Criminal Defense Attorney Today

DeMichael Law has extensive experience in representing clients in complex trademark litigation matters. If you have been accused of trademark infringement, please get in touch with the law firm for legal advice to help you through the process.

DeMichael Law is owned and operated by attorney Andrea DeMichael. When you call this law office, you can be assured that you will speak directly with the attorney and not a member of her legal staff. As your legal representative, attorney DeMichael will give you complete dedication throughout the legal process to pursue the most optimal outcome for your case. 

Schedule a free consultation by calling 863-216-1831.