Practical steps for dealing with counterfeiting activities in Hong Kong
It is advisable to take the following steps in combating counterfeiting activities in Hong Kong.
- We suggest client to issue cease and desist letter to the target infringers found in Hong Kong. We find that cease and desist letters are particular effective against retailer infringers because (a) they may not have been aware that they are selling counterfeit products and (b) they tend to be willing to settle the dispute quickly with client to save troubles.
- If the recipient of the cease and desist letters come forward for settlement, we shall ask them to execute a Deed of Undertaking incorporating the following terms:-
(i) Not to deal with the infringing products and not to infringe client’s registered mark in the future;
(ii) Disclose their suppliers and buyers and all information of their dealing with the infringing products;
(iii) Surrender all existing infringing products in their possession;
(iv) Pay damages to client, for an amount to be assessed by the court if not agreed; and
(v) Pay legal cost to client, for an amount to be assessed by the court if not agreed.
- If the target infringer fails to respond positively and to settle, client may choose one of them to sue to set an example, and then publish an announcement (in newspaper or whatever media) to announce the said civil action and client’s determination and effort in anti-counterfeiting to increase the deterrent effect against other infringers.
According to our experience, most of the defendants either amicably settle the litigation with our clients or run away and not to defend. In both scenarios, a judgment is expected be entered against the defendants in about 4 to 6 months after the litigation is lodged.
To initial a court action, the plaintiff shall file and serve a Writ of Summons claiming relief (i) injunction order, (ii) disclosure order, (iii) delivery up order, (iv) damages order, (v) legal cost order and (vi) other relief as appropriate. Thereafter, we shall further file and serve a Statement of Claim stating the circumstances and reasons of client’s claims.
Upon being served with the Statement of Claim, the Defendant shall file a defence within 28 days, failing which the Plaintiff is entitled to enter a default judgment and order against the Defendant without submission of evidence.
If however to an extreme that the Defendant defend the civil action vigorously, the court action up to trial could easily incur cost of over half million Hong Kong dollars, depending on the development of the action. That said, unlike other commercial disputes, IP infringement court actions would highly likely end up with an amicable settlement rather than a full trial, in particular in such clear cut case of infringement as the present case.