How to defend against intellectual property violation charges

If you consider that your intellectual property rights have been infringed, there are different authorities you can contact.

For an alternative to a court, you can use Alternative Dispute Resolution (ADR), which can be cheaper and faster than a legal dispute in court.

Patent infringement

If someone uses your product or invention protected by a patent without authorisation, you can defend your right and take action. For infringements of national patents, you can contact the competent national court.

Imitation of a branded good – Counterfeit products

If someone is selling a good bearing your trademark without your authorisation, you are the victim of counterfeiting.

Block suspicious products

If you suspect that certain goods infringe your intellectual property rights, you can request the competent national customs department to detain these goods. To do so, follow the instruction on the TAXUD portal.

To protect your products against counterfeit, register with the Enforcement Database of European Union Intellectual Property Office (EUIPO), which puts you in direct communication with the relevant authorities.

If you are an EU company and you want to report a counterfeit in a country outside the EU (In this case, outside the 27 EU member states) , you can use the Anti-Counterfeiting Rapid Intelligence System (ACRIS).

Identical or similar EU trade marks

If someone has registered a similar or identical EU trade mark to yours, you can ask the European Union Intellectual Property Right Office (EUIPO) to cancel their registration. If the registration is still ongoing, you can oppose the application.

To find out more about your right and the procedures to follow, check the EUIPO page on enforcing your registered trade mark.

Infringement of trade secrets

In case of infringement of trade secrets, you can initiate a legal proceeding before a court. The outcome might be a court order prohibiting the infringer from using or further disclosing the trade secret and/or monetary compensation.

Dispute over domain names

If you find out that someone has deceivingly registered a domain name whose IP rights belong to you, such as:

  • for one or more top-level extensions (like .eu, or .com.)
  • a trade mark
  • a trade name

If then, this person tries to sell you such a domain, you are a victim of cybersquatting. In domain name dispute cases, you can either go to court or make good use of non-judicial remedies including ICANN alternative proceedings. ​

Sample story

Sofi is a Swedish entrepreneur and trades Asian food products in Sweden and Finland. To sell her product online, she has registered a website called orientexpress-asianfood.com. A few months after the registration, a company contacts Sofi to try to sell her the domain name orientexpress-asianfood.eu. If she doesn’t agree to buy this domain, they tell her they will sell it to another company, could make her lose some clients. Sofi thinks this is a sort of blackmail so she decides to report the company to the Swedish authorities.

Infringement of protected geographical indications

If your product that is protected by geographical indication has been counterfeited or there have been other infringements of geographical indication, you should contact the competent national authority.

Affected by Brexit?

  • EU information on Brexit readiness for businesses
  • EU publications on Brexit
  • UK government information

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An infringement occurs when your intellectual property is used without your permission by:

  • a competitor
  • an employee or former employee
  • a contractor or consultant that you have engaged, or previously engaged
  • anyone else.

When should I enforce my intellectual property rights?

  1. Protect the value of your intellectual property
    • If anyone can use your trademark, patent, PBR, or other intellectual property rights without compensating you for that use, your intellectual property rights do not maintain value.
    • Your intellectual property rights maintain value only for as long as the use of your intellectual property is not free.
  2. Stop an infringer
    • If you know that your intellectual property rights are being infringed, you can seek a court order to stop the infringer using your intellectual property rights.
    • This type of court order is called an injunction.
  3. Seek compensation
    • If your intellectual property has been infringed, you can seek a court order to be financially compensated by the infringer.
    • This type of court order refers to paying damages.
  4. Protect your reputation
    • If your trademark has a reputation in the marketplace, the misuse of the trademark may impact negatively upon that reputation. You may want to stop that misuse by seeking an injunction.
  5. Prevent infringing products entering Australia
    • If you know of products entering Australia that infringe your trademark or copyright, you can ask Australian Customs to seize the infringing products and stop them entering Australia.
  6. Deter misuse
    • If you have a reputation for enforcing your intellectual property rights, it may deter infringers.
    • Conversely, if you have a reputation for not enforcing your intellectual property rights, it may encourage infringers.

If I have to enforce my intellectual property rights, why should I bother having them to begin with?

Not every holder of intellectual property rights incurs legal fees in enforcing their intellectual property rights.

In fact, relatively few people ever need to seek legal help. Having intellectual property rights in the first place deters infringers.

Most people will not intentionally infringe your intellectual property rights because they know that you are able to seek an injunction to stop them, and obtain damages against them for their misuse of your intellectual property rights.

This explains the high number of trademarks, patents, plant breeder’s rights, etc. that are granted, and the relatively small number of infringement actions that are brought.

Should I just threaten someone I think is infringing my rights?

You need to think carefully before making threats against someone you suspect may be infringing your intellectual property.

Making threatening demands without evidence is unlawful. If you assert that your intellectual property has been infringed, you need to have evidence that that is the case.

You should therefore always obtain legal advice about the adequacy of your evidence, before making threatening demands of someone you suspect may be infringing your intellectual property rights.

What is the range of court orders I can seek?

There are a number of different types of court orders that might be available depending on your specific circumstances:

  1. Injunction
    • There are 2 types of injunctions: interim and permanent.
    • An interim injunction is an urgent but temporary order that requires an infringer to stop infringing.
    • This is called an interim injunction because a court must be persuaded that there is urgency, and that there is sufficient evidence of infringement. A court will defer ordering a permanent injunction until all the evidence has been presented.
    • Once all the evidence has been presented, if the court continues to be satisfied that infringement has occurred, a permanent injunction can be ordered.
  2. Damages
    • Damages is an order that financial compensation be paid by the infringer to the intellectual property rights holder for the loss that the intellectual property rights holder has suffered as a result of the infringer.
  3. Account of profit
    • This is also a financial compensation order, but instead of the infringer paying damages, the infringer must hand over the profits they made from their infringing conduct.
    • This amount could be much larger than the damages that might have been ordered.

Is court action the only way that I can enforce my intellectual property rights?

You may need to go to court to seek an order to protect your intellectual property rights, but not everyone who enforces their intellectual property rights has to go to court.

You can file legal proceedings either through the Intellectual Property Office (IPO ) or through the courts.

A court will expect you to have tried to resolve your dispute – possibly using mediation – before starting legal proceedings.

File through IPO

Contact IPO for more information on filing through them.

File through the courts in England and Wales

The court you go to depends on the nature, complexity and value of your claim.

Claims below £10,000

Use the Intellectual Property Enterprise Court (IPEC ) small claims track if your claim is for less than £10,000 and for infringement of one of the following:

  • copyright
  • passing off
  • trade marks
  • breach of confidence
  • unregistered design rights

You don’t need a lawyer to use the IPEC small claims track.

Claims up to £500,000

You can take a case for any IP right to the Intellectual Property Enterprise Court (IPEC ) if you do not wish to claim more than:

  • £50,000 for legal costs
  • £500,000 for damages

If you’re claiming more than £500,000 in damages

Use the Chancery Division of the High Court of England and Wales – there are no limits to legal costs or damages you can claim.

File through the courts in Scotland

Use the Court of Session if your claim is complex or valuable – there are no limits to legal costs or damages you can claim.

File through the courts in Northern Ireland

You can use the Chancery Division of the High Court of Northern Ireland if your claim is complex or valuable – there are no limits to legal costs or damages you can claim.

IP rights are enforced through civil proceedings. This means there is no policing body that prevents infringement of IP rights and infringement disputes must be brought by the rights holder. However, litigation costs in the English courts can be very high – ranging from £100,000 to several million pounds according to the size and complexity of proceedings. Thankfully, legal enforcement proceedings are relatively rare and most often negotiation can lead to settlement before legal action is required.

If you believe your IP rights have been infringed, the most common litigation claims are for:

  • an injunction (ordering the infringer to cease using your IP); and/or
  • damages (remuneration of any profits the infringer gained from unlawfully using your IP).

Further examples of claims can include destruction (for example, ordering destruction of counterfeit goods), and inspection (ordering independent inspection of a production facility to ascertain whether production methods are infringing your IP).

If you have IP rights registered in multiple jurisdictions, a key question when strategizing your infringement dispute is where to take the action since litigation disputes are held on a national basis. You may wish to consider factors such as:

  • Market share
  • Predictability of outcome dependent on national case law
  • Cost
  • Speed
  • Finality
  • Enforceability

However, due to the high cost of litigation disputes it is often preferrable to negotiate a licensing agreement with the infringing party.

For European patents, opposition proceedings are an alternative way of protecting your IP if you believe a competitor has been granted a patent that is invalid in light of your own, or other, existing IP. Oppositions must be filed within nine months of grant of the offending European patent. There is no equivalent period for UK patents, however post-grant revocation proceedings can be initiated at any time after grant.

Funding

Taking legal action to enforce your IP rights can be very costly, so it is wise to consider how you would fund this if you had to act. Being unable to take legal action due to the excessive cost of litigation can often lead to reputational and financial harm.

This can be particularly poignant for businesses operating in highly contentious fields of IP, or if your business needs protection against potential liabilities arising under IP indemnities. For example, you may be required to hold licensees, manufacturers, and other parties, harmless against the cost of IP litigation.

One way to address this is investing in IP insurance, of which a variety of types exist, including:

  • offensive insurance – the costs of enforcing your IP rights against potential infringers;
  • defensive insurance – the costs of defending allegations that you have infringed a competitor's rights;
  • any exposures arising under warranties or indemnities given to customers, licensees, or third parties; and
  • the costs of disputes arising under IP agreements such as licenses and distribution agreements.

Investing in IP insurance may also result in additional benefits such as providing a deterrent to potential infringers, adding value to your rights during licensing or assignment, and reassuring lenders and investors.

However, when taking out insurance cover you may wish to investigate the following considerations:

Who is in control of the litigation? (i.e. you or the insurance company)

In general, you, assisted by your legal representative, should remain in control of the litigation. However, be sure to check your policy details to ensure you would fulfil all the criteria to guarantee funding by the insurer.

Can you choose your legal representative?

In most cases, yes, but your chosen representative may be subject to the insurers' approval to ensure they have the necessary skills and knowledge to fight the claim. Check your policy to confirm the exact terms of your agreement, including whether a particular solicitor must be used.

In patent disputes, do you have much say in terms of control of claim amendments?

During a dispute, it is common to consult with your legal representative to determine possible avenues for claim amendment that will be commercially relevant to your business. If there are features of particular importance, you should raise this with your legal representative.

Under what conditions can you rely on the IP insurance?

The exact conditions depend on your chosen policy, for example this may include whether you are insured against costs only for enforcing your IP rights, or also defending infringement allegations.

If you have a potential claim you may also need to obtain a legal opinion from a qualified person confirming a good chance of success. Some insurers may require a minimum confidence level, for example above 50-60% chance of success, to be relied upon to fund the pursuit of a claim.

In general, you will not be insured if you are aware of an ongoing infringement or if you know/believe an infringement is likely to occur upon taking out the insurance policy.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Disclosing business plans, pitching new ideas and proposing new designs are well-trodden routes for startups and small businesses to encourage a new client to buy and an investor to invest, but they come with a constant risk of IP (intellectual property) infringement.

Protecting IP, by excluding others from using your creations, can give a huge commercial advantage. However, it can be expensive for small businesses, and if third parties breach protected IP the difficulties of proving that breach and the costs of bringing a rival to court can put smaller firms off pursuing a case.

There are, however, cost-effective and practical tactics a small business can implement to discourage IP infringement:

Make sure clients know you own the IP

Before presenting to a new client or investor, ask them to sign a non-disclosure agreement, which also confirms that you are the owner of the design or idea. If making a presentation, ensure the trademark or branding is across all content.

Watch out for self-employed contractors

Usually IP rights developed by an employee in the course of employment will belong to the employer. However, increasingly people are employed as contractors and the rules are not the same. If a self-employed contractor leaves a small business, they could claim ownership of IP created during the time they worked for the company. If contested, this could lead to investor or supply chain problems or, in the worst case, extremely costly litigation. Always ensure there is a clause in the contract that transfers ownership of IP created during the contractor’s tenure to you.

Contacting a perpetrator directly

At times a legal letter to a competitor highlighting the infringement and requesting a cessation of all activity in this area could be enough to discourage any further IP breach. Small businesses can also use a mediation service from the Intellectual Property Office if the company accused of infringement agrees to take part. However, cases involving trademark disputes may not be suitable for mediation.

Obtaining IP protection can give you a competitive advantage allowing you to sell those products or services at a premium. However, having IP rights in place is meaningless unless those rights are enforced. The threat of enforcement is what allows the IP to be exploited as a commercial asset. Competitors or other third parties may still infringe on your intellectual property rights. If that happens, there are steps you can take to end the infringement.

Enforcement of IP rights is necessary in order to:

  • Preserve the legal validity of your IP rights.
  • Prevent infringement from occurring or continuing in the marketplace in order to avoid damage including loss of goodwill or reputation.
  • Seek compensation for actual damage, e.g. loss of profit, resulting from the infringement.
  • Damages
  • Injunctions
  • Orders to account for profits
  • Orders to seize, destroy and/or hand over infringing goods to right holders.

If you are in a position where you need take steps to enforce your Intellectual Property rights, there are a number of ways, depending on the circumstances of infringement, in which you can proceed.

Should an IP right infringement occur it is suggested that alternative mechanisms to resolve disputes are explored first and that, only when this is not a viable solution, you enforce your rights through legal proceedings

An initial step, particularly in the case of Trade Mark infringement, can be the issuing of a cease and desist letter drawn up by a solicitor. Due to the threat of court action if the infringement continues, in a lot of cases, this action might be sufficient to deter the infringer.

It is always advisable to seek legal assistance to determine how best to proceed and always seek professional legal advice from a solicitor or IP professional before embarking on enforcement proceedings.

Enforcement of intellectual property (IP) rights in other countries can also be complex and require careful consideration. Enforcement actions abroad will require the legal expertise of IP professionals in that country. Irish legal and IP professionals with relevant international experience would be able to identify and instruct a suitable overseas firm to advise and provide representation.

For more information please consult the IPR Helpdesk fact sheet on defending and enforcing IP.

Defend your rights against infringements

After registering your trade mark (or any other intellectual property right (IPR)) you need to ensure that it is not used by anyone else in the market.

Monitor the marketplace by checking the press, trade publications and the web for companies using your trade mark without authorisation. It may be that illegal copies of your products are on sale or that competitors are using marks that are similar, but not identical, to your trade mark.

Customs and police are enforcing intellectual property rights on the front line — at the EU borders and in the internal market. To effectively carry out their task, the enforcement authorities need the active engagement of the rights holders themselves. Cooperation is the most effective weapon: thanks to the information provided by the rights holders, enforcers can identify goods suspected of infringing IPRs more easily and subsequently take the necessary action.

The European Union Intellectual Property Office (EUIPO) has developed the IP Enforcement Portal to enable rights holders to protect their products against counterfeiting by sharing information on their products, IP rights and contact data with EU enforcement authorities.

In addition, for customs to be able to take action and detain goods suspected of infringing IPR, you need to file a customs application for action. This can be done electronically through the IP Enforcement Portal.

Use of the tool is free, secure and available in the 23 languages of the EU

Enforcement Agencies in Ireland

The Revenue Commissioners are empowered to take action against infringements of intellectual property rights at points of importation into the State. Revenue is also responsible for liaison and intelligence sharing, with other enforcement agencies, and in particular the National Bureau of Criminal Investigation in An Garda Síochána. An Garda Síochána have a dedicated Anti-Racketeering Unit that deals also with the protection of intellectual property rights within the State such as, in the case of illicit pirated and counterfeit goods.

Many businesses believe that receiving a patent offers complete protection against infringement. However, when a patent is threatened, patent holders must take more drastic measures to protect their interests. Patent litigation includes legal actions to protect patents against infringement, and may result in monetary damages or an injunction against the infringement.

Patent Infringement Litigation: The Basics

Patent infringement occurs when another party makes, uses, or sells a patented item without the permission of the patent holder. The patent holder may choose to sue the infringing party to stop his or her activities, as well as to receive compensation for the unauthorized use. Since intellectual property is governed by federal law, the patent holder must sue the unauthorized party in federal district court.

Patent holders must bring infringement actions within six years from the date of infringement; if the suit is not brought in this time limit, it is time-barred, ratifying the infringement. While patent litigation proceeds much like any other federal case, the complicated legal issues surrounding patent validity and infringement are reserved for the court’s determination, although some patent litigation cases use juries for other aspects of the overall case.

Defenses to a Patent Infringement Lawsuit

The alleged infringer typically counters the patent holder’s suit by alleging that the patent is not valid. Patents are invalid if the holder included fraudulent information in the U.S. Patent and Trademark Office application; if the patent resulted from anticompetitive business activities; or if the alleged infringer can show that the patent did not meet the requirements of novelty and nonobviousness required for patent protection. Novelty requires that the invention be entirely new, while nonobviousness means that the invention cannot be a variation or an obvious improvement of an existing invention.

The patent holder bears the burden of proof to show that the defendant infringed the patent. The plaintiff must prove infringement by a preponderance of the evidence. This standard means that the greater weight of the evidence must show that the patent is infringed.

Different Types of Patent Infringement

There are different ways another party may infringe on your patent, including:

  • Direct Infringement: This occurs when a product covered by a patent is manufactured without permission.
  • Indirect Infringement: An indirect infringer may induce infringement by encouraging or aiding another in infringing a patent.
  • Contributory Infringement: This occurs when a party supplies a direct infringer with a part that has no substantial non-infringing use.
  • Literal Infringement: This exists if there is a direct correspondence between the words in the patent claims and the infringing device.

Even if an invention does not literally infringe the patent, it may still infringe under the doctrine of equivalents. A device that performs the substantially same task in substantially the same way to achieve substantially the same result infringes the patent under this doctrine. If the court finds infringement, it must still determine whether the infringement was willful.

Willful Infringement

Willful infrigement involves intentional disregard for another’s patent rights and encompasses both direct and intentional copying and continued infringement after notice. Patent users and inventors should employ patent attorneys to ensure that the use of a patent is valid and noninfringing. Even if infringement is later found, the attempt to secure a legal opinion is evidence that the infringement was not willful.

If the court finds that the infringement was willful, the infringer faces a substantial financial penalty; a willful infringer may end up paying triple the amount of actual damages suffered by the patent holder, as well as the plaintiff’s attorneys’ fees.

Patent Infringement: Penalties

When a court finds infringement, the infringer usually must pay damages to the patent holder, either in the form of actual damages or a reasonable royalty for the unauthorized use. Actual damages include lost profits the patent holder would have realized but for the infringement, while a reasonable royalty depends on the type of product, other royalty arrangements, time remaining on the patent, and other issues. In addition to damages, the prevailing party is also entitled to costs. Costs include court filing fees and related litigation expenses.

In addition to infringement damages, a patent owner may stop the infringer from continuing to produce infringing products. The court typically, as a matter of course, issues a permanent injunction after the infringer is held liable for violating the patent.

In some instances, the patent holder will seek a preliminary injunction at the outset of the lawsuit where he or she can show no detriment to the public interest if the injunction is granted, a substantial likelihood of success on the merits of the case, and more compelling hardship for the patent holder if the infringer continues his or her activities while the case proceeds. The patent holder will find it difficult to get a preliminary injunction unless a prior adjudication proved the validity of the patent.

Facing a Patent Infringement Claim? An Attorney Can Help

The combination of federal court jurisdiction, complicated subject matter, and technical underpinnings of patent law mean that patent holders and accused infringers should seek highly skilled legal help. Patent attorneys can assist litigants in developing their cases and in securing aggressive litigation services. Get in touch with an experienced intellectual property attorney today and protect your business.

Once you own IP, you are responsible for monitoring the market to ensure you are not being infringed. If you are the victim of infringement it is then up to you to take the appropriate steps – an IP lawyer or attorney can assist you to determine if you are being infringed and the best way to deal with the situation. We are not in charge of monitoring IP infringement – this is your responsibility.

You need to monitor and safeguard your IP. This means letting others know you have a legal right to your IP and, if necessary, defending your rights through legal action. This is to ensure that only you can turn your ideas into a commercial reality.

Infringement

Don’t wait for someone to infringe your IP. Putting a strategy in place to deal with infringement before it happens should be part of your overall protection and commercialisation strategy.

If you find your IP is being copied or used by someone else without your permission, there are a number of actions you can take. Possibilities available to you can range from a letter of warning from you or your attorney – to court action. It is always best to seek professional advice.

Whatever action you do take, pursue it vigorously and make sure any person infringing on your rights knows you are serious about protecting your IP. Any delay could jeopardise your legal rights to take action.

Proof of ownership

Owning IP is like owning physical property. It indicates to others that you have a claim on it, it deters others from infringing upon it and enables you to take legal action against those who do.

To help prove your ownership of IP, keep a record of:

  • what kind of right you have, and in what form the right was created
  • what, if any, material from a third party was used in the creation process, and whether permission for such use was obtained
  • when it was created
  • who created it
  • evidence of ownership – such as an application for a patent, trade mark or design
  • contracts with all parties involved in the creation of the IP that clearly identify who owns the IP
  • log books showing how the creation process was undertaken (particularly important for IP created by employees)
  • files of early drafts and prototypes that embody IP
  • copies of agreements with those on whose behalf you are distributing goods or services. These should include agreements giving distributors the right to use trade marks and marketing material. This evidence should be stored in an IP Register with a back-up copy in a separate location

Infringement of trade marks on the internet

When you trade over the internet, you are entering a global marketplace. There is no such thing as a ‘world’ trade mark. Registration of a trade mark in South Africa does not give you any rights in relation to that trade mark overseas. If you offer goods or services for sale on the internet, you could be sued for infringement in a country where someone else owns the trade mark.

South Africa is a member of the World Intellectual Property Organization (WIPO) which establishes guidelines to protect trade mark owners who trade over the internet.

Be aware of the potential risks you face when trading over the internet. You should seek legal advice on the best ways you can avoid or minimise those risks. Most importantly, you should seek legal advice if you receive notice from an overseas trade mark owner alleging that you are infringing their trade mark via the internet.

Trade mark owners contemplating trading over the internet should consider applying for international trade marks.

Ways Intellectual Property Can Be Stolen

In the digital era, intellectual property theft is becoming an even greater issue and a common form of white-collar federal crime. Piracy, file-sharing networks, and streaming services are making it easier for intellectual property theft to occur. There are many different types of intellectual property theft:

  • Counterfeit Trademarks
  • Counterfeit Drug Trafficking
  • Counterfeit Labeling
  • Criminal Copyright Infringement
  • Pre-Release Criminal Copyright Infringement
  • Recording Movies in Theatres
  • Theft of Trade Secrets

Investigations into Theft of Intellectual Property

The United States’ National Intellectual Property Rights Coordination Center works to curb global intellectual property theft by leveraging the efforts of 21 partner agencies. Seventeen key federal agencies – including the FBI, working with Interpol, Europol, and the governments of Canada and Mexico – to investigate the theft of intellectual property.

When investigators zero in on a target, the investigation may go on for months or even years. They will have extensive evidence that your federal defense attorney will need to counter with expert witnesses.

Consequences of Intellectual Property Theft

The penalties for stealing intellectual property varies depending on the severity of the crime. Generally speaking, most intellectual property theft penalties start from a fine of $250,000 and/or 3 years in prison and can range to a $5 million fine and/or 20 years in prison. Refer to the list below outlining the consequences for different types of intellectual property theft:

  • Counterfeit Trademarks – You face up to 10 years in prison and a $2 million fine if you are convicted of intentionally using a counterfeit mark and you traffic in goods and services.
  • Counterfeit Drug Trafficking – You face up to 20 years in prison and a $5 million fine if you are convicted of counterfeit drug trafficking or trafficking in certain types of counterfeit military goods or services.
  • Counterfeit Labeling – Under U.S. Code, Title 18, you face up to five years in prison and a $250,000 fine if you are convicted of trafficking in counterfeit labeling. These could be labels that are normally affixed to visual art, movies, music, software, books, and other related works. It also applies to counterfeit documentation or packaging for these types of mediums.
  • Criminal Copyright Infringement – Copyright infringement is becoming a more common federal crime. It is a felony punishable by up to three years in prison and $250,000 in fines. To be convicted of criminal copyright infringement, the government must prove beyond a reasonable doubt that you willfully reproduced and/or distributed at least ten copies of one or more works that were copyrighted. They must also show that these copies had a total retail value of more than $2,500, and it must have occurred within a 180-day window. The penalty increases to ten years in prison if you acted for commercial advantage or private financial gain. Criminal copyright infringement can also be charged as a misdemeanor if the total retail value exceeds $1,000 but is less than $2,500.
  • Pre-Release Criminal Copyright Infringement – Whether it’s music, movies, or software, there’s often a lot of pre-release excitement to build enthusiasm. If you are found to be engaging in pre-release piracy, you can be convicted of a felony. The penalties include up to three years in prison and a fine of $250,000 under Titles 17 and 18 of the U.S. Code. The prison time increases to up to eight years if you are found to be acting for commercial advantage or private financial gain.
  • Recording Movies in Theatres – Frequently known as “camcording,” you can be charged with a federal felony for recording movies playing in public theaters. The penalties include up to three years in prison and a $250,000 fine.
  • Theft of Trade Secrets – Under the Economic Espionage Act, you can be charged with the theft of trade secrets to benefit a foreign government, institution, or agent. The penalties are harsh, and you face up to 15 years in prison and a $5 million fine if convicted under U.S. Code Title 18, Section 1831. You can also be charged under U.S. Code Title 18, Section 1832 if you are found to be engaging in the theft of trade secrets to benefit anyone other than the owner. This is punishable by up to 10 years in prison and a $250,000 fine.

Caught Stealing Intellectual Property?

If convicted, you face years in prison and extensive fines in addition to a permanent criminal record. The long-term consequences are severe, as many people with criminal records – especially federal convictions – find it difficult to keep or find jobs, apartments, and much more. Contact a federal attorney today at Worgul, Sarna & Ness, Criminal Defense Attorneys.

Questions? Contact us.

Your rights and future are at stake. Let us defend you. Contact us for a free, confidential case evaluation to learn how we can defend you against intellectual property theft charges.

The exercise of intellectual property rights has become a mainstay of business over the last 10 years. Indeed, business models are proliferating where obtaining patents for the purpose of licensing and enforcement are the sole activity of the enterprise. Even among those entities that routinely engage in R&D or the manufacture and sale of products, more and more are investing in the acquisition of IP rights, and many have realized that enforcement of those rights against competitors is an effective tool in protecting markets and/or generating revenue. As a consequence, corporate executives and general counsels are likely to face, at least once in their careers, a charge that their companies are infringing upon another entity’s intellectual property rights.

Especially threatening is the receipt of a notice that your company’s products infringe patents held by another. The threat is worrisome for a variety of reasons. First, the threat is often leveled at a company’s core technology, changes to which are almost never trivial. Second, patent infringement carries with it the very real threat of devastating injunctive relief. Finally, damages in such cases, while nominally calculated in terms of a reasonable royalty or lost profits, may, at the discretion of the court, be enhanced up to three times for so-called willful infringement. In order to navigate this minefield and defend themselves against claims of willfulness, many companies engage counsel in order to obtain advice as to whether their actions violate valid patent rights of some third party and/or how to avoid such violations by design arounds. This article, addresses defenses to a charge of willfulness, and in particular, some of the issues which may arise when relying on opinions of counsel as a defense to a patent owner’s claim of willful infringement.

The “Totality of the Circumstances” Test

When considering whether an infringer acted in bad faith, thereby supporting an increased damage award, courts look at a “totality of the circumstances,” including (1) whether the infringer copied the invention of another; (2) whether the infringer, when it knew of the other’s patent, investigated the scope of the patent and formed a good-faith belief that it was either not infringed, invalid or both; (3) whether the infringer mounted a substantial (albeit unsuccessful) challenge in the issues of validity and infringement; (4) the closeness and complexity of the legal and factual issues presented; (5) whether the infringer engaged in good faith efforts to design around the patent; and (6) the infringer’s behavior in the litigation. 1 Because there are few situations where sufficient evidence of actual copying or litigation conduct egregious enough to find willfulness are present, the primary focus for courts when considering willful infringement claims is usually on whether an alleged infringer has formed a good-faith belief that its conduct was justified.