Self-confessed online fake-vendor: how best to handle him

Some of the IPKat's younger readers
are sure they know the right answer ...
A bright and charming young lawyer has emailed the IPKat with this little note:
"A client based in the US, but having EU-wide trade mark protection, has alerted me to this problem:
'I've located a seller, based in [a picturesque and historical English town: name withheld], who admits on his website that his products (clothing badged with our registered trade marks) are counterfeit.

Taking a closer look at eBay, it appears that he has sold more than a thousand items--  but he doesn't appear to have sold any in the last 15 days. Having located the criminal activity, what are we able to do to stop this action continuing?'.
If we tell eBay that these are counterfeit products, the seller’s auctions will be terminated and these products will go underground before resurfacing elsewhere. The seller's business therefore just carries on after a minor delay -- but continues nonetheless as no goods have been seized. Customs and the Border Agency are a non-starter unless we can show that the goods are coming in over the border and not originating in the UK. More likely they are originating here in the UK, but this needs investigating.

If anyone has experience of this type of scenario I would appreciate their input as my experience is a wee bit theoretical and could do with some extra brain-power".
This Kat has to concede that, in a scenario such as this, his experience is more than a wee bit theoretical. Although, like all good IP bloggers, he is omniscient and infallible, he thinks it might be in order to let his readers give their advice, so he can tell them whether they're right or not.  Please post your comments below or, if for technical or other reasons you can't, just email them to this Kat here and he'll do the rest.
Self-confessed online fake-vendor: how best to handle him Self-confessed online fake-vendor: how best to handle him Reviewed by Jeremy on Friday, June 15, 2012 Rating: 5


  1. Stop him on eBay. It may not, as suggested, be a complete solution but it's likely to make it significantly more difficult for him to sell these goods elsewhere. A damaged reputation with eBay may also impair his ability to trade at all, so it's worth teaching him that lesson. Regarding the source of the counterfeits, unless the trader is making them himself, perhaps he would provide that information in return for being 'let off lightly' in some way.

  2. I think that the answer is obvious: Send in a fake Police Squad!

  3. Isn't this something Trading Standards should be involved in, at least if they have the resources.

  4. Persistently monitoring eBay and the like, and asking for take-downs quickly is actually very effective in my experience (can also be outsourced cost effective). You can obviously not get your hands on the fakes, but continously blocking easy sales channels is a good disincentive. Bootleggers will more likely leave your brand alone, when the policing of eBay and such is done often. They will (eventually) switch to easier brands (no brand loyalty with this lot...).

  5. If you know where the seller is based, it's worth giving the local Trading Standards office a call - TSOs can get quite enthusiastic about dealing with counterfeits, particularly if you can show that the infringement is on a biggish scale.

  6. I have had this issue, which I have had to deal with on behalf of one of my clients who is based in Italy.

    The seller on eBay admitted that the goods were counterfeit. In the end the relevant trading standards seized the goods for me, I wrote a witness statement as I usually do for this type of issue and the case is now going to court.

    My advice would be to contact the relevant trading standards, they are likely to be able to help sort it out.

  7. If the lawyer contacts eBay through the VeRO programme he can stop sales on eBay he can also ask eBay (after going through the VeRO programme) to disclose the name and address of the seller. He has to agree to use the information only for IP enforcement purposes.

    If there are no current sales on eBay at the moment if he has evidence of past infringements, he should be able to get the information anyway. He ought to get them banned from selling on eBay anyway as it is such a large market place.

    He should also print off or store the evidence of the thousands of sales that have gone through eBay so that he has proof that this has happened. This can be used in future proceedings/negotiations with the seller.

    Has he looked on other auction sites such as Amazon and the other plethora of sales sites? Trading could still be going on there. Is there any reason for the hiatus of sales on eBay? The person may just be on holiday….

    Would trading standards be of any assistance to him?

    If he can identify the seller, either through eBay or some other method then he can take court proceedings – injunctions etc it just depends how much the rights owner wants to spend.

  8. Pursuant to s.93 of the Trade Marks Act 1994, Trading Standards have a statutory obligation to enforce the criminal provisions of the Act. Your reader should contact the Trading Standards Service at the Local Authority within whose jurisdiction the picturesque and historical town is located. With enough information, Trading Standards can obtain a warrant of entry and pay a visit to the seller’s home and/or storage facility. This may lead to a criminal prosecution, which is usually the most effective way of bringing counterfeiting activities to an end. Alternatively, the TM owner could choose to bring a private prosecution, the costs of which, if successful, are recoverable from central funds (or the defendant if they have the means) under the Prosecution of Offences Act 1985.

  9. It is up to what your client wants. If you wish to make him/her stop trading illegitimately then the most cost effective way is to inform eBay for action take downs or send a cease and desist letter to the trader and hopping that he will stop trading with counterfeit products.

    However, if your client wishes to recover damages then I think that you can have potential satisfactory recoveries. What you need to do is to instruct an investigator to make a test purchase (TP) from the trader and send that item purchased to an expert so he/she can confirm that the product purchased is counterfeit. As soon as you have the evidence then you can send the trader a letter before action stating that you have made a TP and you have evidence that he is selling counterfeit products… And hopefully you can negotiate for an out of court settlement. I would suggest you to go on his/her eBay profile and look how much money the trader made from selling counterfeit products so you can establish damages.

    Another option is to forward the information to trading standards and hoping that they might take an action against him/her which can lead to even a custodial sentence.

  10. I agree, Trading Standards would be the appropriate body to contact. Another option would be to contact the local constabulary, in this case Derbyshire who currently have a Crimestoppers initiative underway regarding counterfeiting Experience of these initiatives may vary between forces though, I received a less than enthusiastic response when I reported under a similar initiative operated by my own local force a few years ago (not Derbyshire).

  11. Whilst eBay is helping out by removing items under its VeRO programme, the seller may well re-surface. It is possible to ask eBay for the seller's details after filing a NOCI (Notice of Claimed Infringement), but these details will have been provided by someone who no doubt wants to avoid detection, so often turn out to be false. Bank details (usually authentic as ID will have been obtained to set up the account) are sometimes held by eBay (and PayPal, the related payment scheme provider), but these do not tend to be released without a court order.

    Whilst not guaranteed to get to the bottom of it, arranging for trap purchases is often the best way of investigating the matter before any VeRO action is taken. Obviously, it should be done by someone unrelated to the trade mark owner so as to not give the game away (for example, through an enquiry agent). Sellers often unwittingly give away personal information when sending goods through to the buyer, for example on eBay invoices or the packaging (including postmark details). In the past, I have had success tracing errant distributors by linking the closest known address to the Post Office from where a parcel was sent (though that probably won't apply here). You may also be able to open up a dialogue with the seller, for example by looking to buy more items or asking questions about the product - again, they can unwittingly give away personal details including emails and addressed in such a dialogue. If you do get the seller's address details from eBay, Google Maps' Street View is a useful tool for a desktop look at the seller's hideaway.

    All of this might (hopefully) lead to further details being obtained before sending in a NOCI. If you can get behind the eBay identity then you can take direct action, which is usually more effective.

  12. There are plenty of possibilities here, depending on exactly what is going on. And that’s the key. More information/evidence is required.

    Whilst on the one hand a curse, eBay can be a blessing because there is much which can be seen from information available on the site. Your bright and charming young lawyer has already figured out that this seller has sold a thousand items. He/she should also be able to see the period over which those items have been sold and thus get a feel for how serious a problem the seller poses. 1,000 items in the last month is a much more serious problem than 1,000 in the last 12 months.

    But let’s assume this seller is at the more serious end of the scale.

    Since the seller is sufficiently significant that mere takedown and a C&D letter feels much too weak, the seller needs to be located, evidence obtained, and something more meaningful done.

    A pre requisite, therefore, is finding the seller. This information is often available with the eBay listing. If not, the best option, without taking the site down and asking eBay to provide the information (which would tip off the seller), is to simply purchase an item – contact details may be revealed when the goods arrive or should be fairly easy to obtain by engaging in an email exchange following receipt (“This isn’t what I wanted, can I send it back?” for example. If that doesn’t work sophisticated investigators should be able to locate the seller from his emails.)

    Once the seller is located you can have investigators take a look with a view to finding out the true scale of the operation, location of stock etc. It will be those findings which will dictate how much time/effort/financial resources the problem warrants. If it’s very significant the local Trading Standards Department, despite very limited resources these days, will usually be very willing to assist and can move quickly and effectively. Not only will they raid/seize, they will (evidence permitting) bring a prosecution and, in serious enough cases, bring a Proceeds of Crime action to really hurt the bad guy(s). If Trading Standards are unable to act quickly enough, for whatever reason, you have the option of civil action (search and seizure order). Since costs of civil action can get steep this an option which is generally kept for only the most serious cases – but bear in mind the power of the courts to order the provision of information (crucially, the defendant’s source of supply) and to imprison for contempt if information is not provided or falsely provided (Coca-Cola v Gilbey (1995) being a case in point).


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