Secondary Infringement – Retailers Exposed!
Secondary infringement of copyright occurs where a person, in the course of his business, without the consent of the copyright owner, imports into this country or sells an infringing copy of a copyright work, where he knows or has reason to believe, it is an infringing copy.
A retailer is not liable until he has knowledge of the copyright work, and that the item he is selling is an infringing item. That knowledge will obviously be fixed upon him once he receives a solicitor’s letter. At that point, they should immediately stop selling and get legal advice.
If the copyright owner is well-known, or his work is well-known, it is reasonable to assume that the retailer ought to know of the copyright work, and thus he may be guilty of secondary infringement for selling the infringing item prior to the solicitor’s letter. If so, he will be liable for damages. In addition, he must cease all commercial activity in the infringing items, destroy any stock, and undertake never to sell again. If the retailer does not do so, then the copyright owner would be entitled, after a reasonably short period, to allow his claim to copyright to be investigated, to commence legal proceedings and include a claim for an injunction.
An injunction is a court order compelling the defendant to stop doing something (such as selling the infringing items), and/or to do a specific act (such as deliver-up documents or stock), under threat of imprisonment for contempt of court.
The law expects that retailers will be judicious when ordering new products. A retailer cannot be wilfully ignorant as to where a product comes from and who designed it. There is a degree of objectivity in “reason to believe”, so my advice is always ask your supplier who designed the product, where is it made, and ask the supplier to give an indemnity against intellectual property infringement. After all, the likes of Marks & Spencer and Harrods insist on it, and at the end of the day, they are retailers too!
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