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Please help me respond to a charge of violating trademark rights.

I run a company that manufactures baking machines. A few years ago, at the request of an acquaintance, I made and sold baking machines bearing the trademark that the acquaintance was using. However, from some point the acquaintance started delaying payment and stopped answering my calls, so I halted the manufacture of the baking machines. Then the acquaintance filed a complaint against me on a charge of violating trademark rights, claiming that I infringed their trademark right.. How should I respond to such a charge.. Will the level of punishment be very high?

Violation of trademark rights

Answer to Related Inquiry

Author: 김국일

Hello. This is an attorney specializing in copyright at Daeryun Law LLC.

The matter you inquired about is a situation in which an investigation may proceed on a charge of trademark infringement under the Trademark Act.

Trademark infringement refers to the case of using, without authorization, a mark identical or similar to another person's registered trademark on designated goods or goods similar thereto.

Here, whether the trademark is registered, the scope of the designated goods, and whether the act of use was intentional become the key issues.

In your case, the origin of the problem is that you manufactured and sold baking machines bearing the trademark at the acquaintance's request, but at the outset there is room to view it as having received the trademark holder's implicit permission.

In particular, the fact that you halted manufacturing after the nonpayment can support the point that there was no intent to infringe.

In such a case, the investigative agency may not treat it the same as simple unauthorized use, but may judge it to be a dispute arising from a transactional relationship.

If a charge of violating trademark rights is recognized, legally imprisonment for up to 7 years or a fine of up to 100 million won may be imposed.

However, since a civil claim for damages may proceed alongside the criminal procedure, you must consider both procedures together.

To respond, you must secure materials that can prove permission or consent to use, such as text messages or emails exchanged with the acquaintance and transaction records.

If the manufacture and sale were merely at the level of an agency arrangement rather than for a profit-making purpose, it is also important to specifically demonstrate this.

If possible, reaching a settlement with the complainant to recover the harm is of great help in lowering the level of punishment.

Above all, in cases of violating trademark rights, statements and evidence at the early investigation stage often determine the direction of the case.

Therefore, it is safer to retain an attorney even before the police investigation, submit a written opinion, and ensure that no unfavorable statements remain during the investigation process.

In your case, you can reasonably expect the possibility of leniency or a non-referral, so we recommend that you thoroughly prepare your initial response.