This article is meant to give a brief introduction to the procedural issues connected with, and remedies available under the Finnish Trademark Law, in matters concerning counterfeited and pirated goods.

Civil or criminal procedure?

Manufacture, import and sales of counterfeit items in Finland do constitute a Trademark infringement that may be prosecuted either as a civil case, or as a criminal case. The infringement may be considered to constitute a criminal act if and when the deed obviously was intentional.

Manufacture, sales and import of clearly counterfeit goods have in the court practise usually been considered intentional if the overall circumstances of the infringing deed give reason to believe that an average trader could have had doubts about the origin of the goods, and the clearance of their status has nevertheless been neglected.

Using of civil procedure may, however, under certain specific circumstances be motivated due to procedural reasons, even if proceeding with a criminal suit might be available. For example: if it may be assumed that serving of the summons is difficult or practically impossible in a certain case (certain foreign defendants, seizures of transit goods, etc.), opening of a civil suit will in practise be the only available way to have the case tried by the court.

Civil remedies against Trademark infringements

The court is, on the request of the plaintiff, entitled to grant an injunction against the infringer. The injunction may be backed up by conditional imposing of a fine.

The infringer is liable to recover any damage that the plaintiff can show that he has suffered due to the infringement. In case providing of an exact sum of the losses will not be possible, the court is entitled to estimate the amount of damages on grounds of the available evidence.

The infringing goods as well as the materials and implements for their production may be ordered to be destroyed on the request of the plaintiff.

A symbol that has been placed without authorization on goods, their packaging, leaflets, commercial documents or the like shall as a general rule be erased or altered in such a way as to ensure that it will no longer be misused. If this can be effected in no other way, the court shall order that the property so marked be destroyed or changed in a specific manner. The court may also, upon demand, order that the property be handed over to the plaintiff against payment.

The losing party will upon request of the winning party be held responsible for the legal expenses that have been incurred for the winning party.

Provisional remedies

Article 4 of the Trademark Law authorizes the court to issue an interlocutory injunction against the infringer, on the request of the plaintiff.

In the case of counterfeit items, the injunction will normally be granted if the plaintiff is able to show that there is a valid reason to believe that the subject goods are not original. The plaintiff is usually requested to place a security for the eventual damages that may be caused for the defendant.

In order to obtain a preliminary injunction, the plaintiff must in his request for summons plead for such an injunction, and produce any available evidence to support this claim.

The preliminary injunction may be granted ex parte, but the security sum, requested from the plaintiff will in such case normally be higher than in normal cases.

The allegedly infringing products may also be confiscated in accordance to Art. 41 of the Trademark Law. Confiscation may be used as a measure for preserving of relevant evidence relating to an alleged Trademark infringement.

It is, however, strongly recommended that the plaintiff, prior to filing of the lawsuit, obtains at least one sample (and a sales receipt) of the suspectedly counterfeit goods in order to prevent the counterpart from disposing of all the infringing goods before they can be confiscated.

This is due to the fact that provisional remedies will in most civil cases not be obtained instantly.

If the defendant fails to comply with a preliminary injunction, the infringement thereafter will be considered intentional, thereby constituting a criminal act.

The injunction will normally also be backed up by a conditional imposement of a fine, the amount of which depends on the scale of the alleged infringement.

Grounds for Criminal Proceedings

Trademark counterfeiting is treated as a criminal offence. Intentional Trademark infringement in general is punishable in accordance with provisions in Trademark Law. Large-scale infringements that are likely to cause considerable damage for the right holder have been criminalized under the Penal Code.

If there is justified reason to believe that the infringement is intentional, the plaintiff is entitled to file a report of offence with the police, bearing in mind, however, that a false accusation may in some cases lead to punishment against the party who reported the offence.

It should be noted that a pending Trademark application will not be considered to form sufficient basis for a criminal suit/criminal investigation. If, however, the subject Trademark has at the time of the opening of the process become established by use, the claim can be based upon the sole right that has been acquired through establishment.

Criminal investigation

The criminal complaint in a Trademark infringement case should be filed either to the police or to the customs authorities in the place of offence.

The prosecution of Trademark/copyright infringement rests with the plaintiff, so the judicial authorities do not act on their own initiative. They may, however during the course of investigation that has been initiated by a certain right holder, inform other right holders about alleged infringements that they have detected.

The suspectedly counterfeit items may, as a first step, be confiscated by the investigating authority as evidence. The police and the public prosecutor will then during the course of the criminal inspection require their confiscation on grounds of the provisions in Trademark/copyright law.

The authorities will not charge the right holder for the initiating of pre-trial measures. If, however, it turns out that the goods are not counterfeit, the importer/consignee/owner may file a claim against the right holder for recovery of the damages that have been caused for him by initiating of such measures.

Criminal remedies

Infringements on Trademark rights can be prosecuted by the public prosecutor upon the request of the owner, or by the owner.

Conviction for intentional infringement leads to fines or in very serious cases to imprisonment. Willful infringements and infringements out of neglect normally give the owner of the Trademark the right to claim damages within three years of the time at which the plaintiff learned of the infringement and ascertain the identity of the infringer, and in any case not later than 10 years from the time at which the infringement occurred. If the defendant is not found guilty of negligence, the court may, where deemed reasonable in view of these financial and other circumstances, rule that he shall transfer to the aggrieved the profits he has gained from such infringement for up to but not more than three years past.

Seizure, forfeiture, and destruction of infringing goods and materials and implements for their production are available in all types of Trademark counterfeiting and copyright piracy offences.

The allegedly counterfeit goods are in criminal cases confiscated by the Police, why placing of securities will usually not be requested from the plaintiff.

Customs procedures

Council regulation (EC) No 3295/94, Laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of Counterfeit and pirated goods, has been implemented in Finland, and the Finnish customs do follow the procedures stipulated therein.

The customs authorities are entitled to keep a shipment of allegedly counterfeit goods, that has been detected either by the customs or by the right holder, in their custody for three days in order to enable the right holder to initiate appropriate proceedings in the matter.

Having been notified about a shipment that consists of allegedly counterfeit goods, a right holder must file a request with the Finnish national Board of Customs for the suspension of that shipment. Having obtained a decision from the customs for the suspension of the shipment, the right holder must within the ten days time limit provided by the Council regulation, file a lawsuit concerning the infringement.

No securities will in the present situation be required from the right holder in connection with the customs seizure of allegedly counterfeit goods. A change of law in this respect is, however, to be expected.

The customs authorities are not entitled to initiate disposal or destruction of the goods. The case must therefore be tried before a competent court of law as a Trademark infringement, either as a civil case or as a criminal case.

One of the typical features for customs procedures in Finland is the large share of transit shipments in the overall number of seizures that have been initiated by the customs. Most of these consignments originate from the Far East countries and were en route to Russia through Finnish ports.

This far, it has proven to be advisable to initiate civil proceedings rather than criminal investigation in cases that concern customs seizures of transit shipments. This is partly due to the fact that the public prosecutors have been reluctant to consider that the consignor or consignee would in fact have willfully acted against the provisions in the Finnish Trademark Law. No legally binding decisions on this issue have been received from the Supreme Court yet.

The main reason for choosing of civil procedure in stead of criminal procedure has nevertheless been the fact that serving of the summons has in most cases proved to be practically impossible. Since issuance of an ex parte decision is not possible in criminal cases, the plaintiffs have as a consequence been forced to file a civil suit in stead, having detected that the defendant can not be found.

In order to enable the customs to detect the counterfeits, it is most advisable that the right holder informs the national board of Customs about his rights on a general level, as well as of his Finnish representatives and the features that may reveal the goods to be counterfeit.

By Esa Korkeamäki at Heikki Haapaniemi, Attorneys at law Ltd.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.