In October 2014, following substantial lobbying from IP pressure groups, section 13 of the Intellectual Property Act 2014 was brought into force creating a criminal offence of unauthorised copying of a registered design in the course of business, punishable by up to ten years in prison.
The Act comes 20 years behind its trade mark counterpart, the Trade Marks Act 1994, which criminalised trade mark infringement and 150 years behind the criminalisation of copyright infringement in 1862. Interestingly, during the epoch of intellectual property innovation in the 19th century, the only way to prosecute was to do so privately, usually by the victim hiring private lawyers and investigators. The English system at the time was based on the principles of individual autonomy in which the right of the private citizen was paramount. Despite the fact that the number of private prosecutions has decreased since the creation of the office of the Director of Public Prosecutions (“the DPP”) in 1879 (later section 1 of the Prosecution of Offences Act 1985 creating the DPP’s role as head of the Crown Prosecution Service “the CPS”), the right to privately prosecute has remained.
What is a Private Prosecution?
In brief, private prosecutions are prosecutions not brought by the Crown or other statutory prosecuting authorities. A private prosecution can be brought by any individual, company, charity or interested party and the right to do so was expressly preserved by section 6(1) Prosecution of Offences Act 1985 when the CPS was established. It has been described as a “constitutional safeguard against inertia on the part of authority”. Other than the fact the prosecution is brought by a private individual or company, for all other purposes they operate in exactly the same way as if the prosecution had been brought by the Crown.
Criminal Offence of Design Infringement
By virtue of Section 13(1) of the Intellectual Property Act 2014 a person commits an offence by intentionally copying a registered design so as to make a product exactly to that design or with features that differ only in immaterial detail from that design, knowing or having reason to believe that the design was a registered design.
Subsection 13(3) creates a further offence of importing, exporting, using or placing on the market a product which is an exact copy of a registered design or differs only in immaterial detail. The difference is that subsection 13(1) is aimed at manufacturers of counterfeit goods, whilst 13(3) targets traders (such as market stall traders, or shops).
Criminal vs Civil
The first question you might ask yourself is why would my company choose a criminal prosecution over the more commonly used civil proceedings? If your company has budgetary constraints but a large fraud or counterfeit problem, private prosecutions are often much cheaper and quicker than civil litigation.
One of the first considerations in potential civil proceedings is “Are they worth it?” There is little value in pursuing civil proceedings against companies or individuals with no money or assets. However, in certain private prosecutions it is possible to apply for legal and investigative costs from central government funds. This may mean that criminal litigation might make commercial sense despite the lack of assets of the defendant. Lastly, with a private prosecution, you – the client – controls the speed of the investigation and prosecution, rather than relying upon the Police or CPS. Prosecutions are also a good deterrent due to the powers and sanctions of the criminal court– including confiscation, the threat of a custodial sentence and a criminal record.
In addition to this, if you or your company intends to commence both civil and criminal litigation, a criminal conviction can be persuasive evidence in a civil case.
How to prove it
The offence can be broken up into four stages:
Step 1: Validity and Ownership.
You must firstly check that the design is registered and that the registration has not expired and/or renewal fees have been paid. There is no need to consider the criteria for registration as registration is prima facie evidence of validity. This may be proved by exhibiting a copy of registered design certificate.
Step 2: Infringing Act.
Section 13 provides an exhaustive list of the activities that are prohibited.
- Copying (i.e. creating or manufacturing);
- Offering for sale or putting on the market;
- Importing or exporting;
- Using the product; or
- stocking it for one or more of the above purposes.
These acts are only prohibited if done in the course of a business and the owner of the registered design has not given his consent to the act. Evidence of the particular act will usually be obtained by the victim themselves and/or by skilled investigators who are often instructed to conduct test purchases to provide incontrovertible evidence of the criminal act.
Step 3: Comparison
The design used by the offender must be compared against the registered design. It is essential to obtain a copy of the design as it appears on the register at the IPO or OHIM to be certain of what the registered design consists of. The defendant’s design as used must be an exact copy or differ only in immaterial detail to the registered design. Ultimately, it will be for jury or lay magistrates to decide, however evidence from a technical expert authorised to act for the owner of the registered design will be vital to a successful prosecution. The dicta built up in civil case law will no doubt be deployed by both sides if this stage is contentious.
Step 4: Mens Rea
The prosecutor will have to prove firstly that the registered design was intentionally copied and secondly, that the defendant knew or had reason to believe that the design was a registered design. In order to prove intention the prosecutor will look at the aim and the purpose of the defendant’s actions, and this element is usually determined by inference considering all the circumstances of the case.
It is a defence for a person charged with an offence under this section to show that the person reasonably believed that the registration of the design was invalid. The courts will therefore be required to defer to the jurisprudence of the civil courts to determine, inter alia, whether the product was ‘new’ and had ‘individual character’ which are requirements of registration of a design. There is also a further specific defence set out in section 13 for ‘non-infringement’.
Private prosecutions, if utilised properly and with advice from an experienced prosecutor with expertise in this area can be effective tools in protecting your design.