Hatton, R. v

Sentencing for sustained counterfeiting and false trade mark offences should ordinarily include a deterrent element. Such offending dishonestly exploits trade mark owners’ reputations and can damage legitimate businesses, their profits and their employees’ jobs.

Personal mitigation, a guilty plea and modest personal profit remain relevant, but they do not make an immediate custodial sentence manifestly excessive where the offending is serious, sophisticated and prolonged.

The appellant pleaded guilty at the Crown Court at Mold to offences of applying false trade marks, possessing articles for making copies of trade marks, and distributing goods bearing false trade marks. He received concurrent sentences of 18 months’ imprisonment and a forfeiture order.

A search of his home disclosed extensive equipment and counterfeit material, including approximately 20,000 discs, music files, DVDs, games and false cover images. The offending had continued for about four or five years. Although the appellant’s personal profit was assessed at about £10,000, the retail value of the seized material, if genuine, was substantial.

He appealed by leave of the single judge, contending that the custodial sentence was excessive in light of his mitigation and the basis of plea.

1. Appeal dismissed. The sentence of 18 months’ imprisonment was not manifestly excessive.

2. The court accepted that the appellant had substantial personal mitigation. He had pleaded guilty, had no previous convictions, was remorseful, was assessed as posing a low risk of reoffending, and had favourable personal references. His profit was materially lower than the retail value of the counterfeit goods. Those matters did not displace the need to assess the seriousness of the offences themselves.

3. The offending was serious and sustained. It involved a large library of unlawful material, equipment capable of copying and preparing discs for distribution, and activity over at least four years. The value of the material was not the sole measure of culpability, but it gave a broad indication of the scale of the dishonest trading.

4. The court treated R v Woolridge [2005] EWCA Crim 1086 as materially supporting deterrent sentencing for trade mark offences. Counterfeiting exploits trade mark owners’ reputations and has a damaging commercial effect. Although purchaser deception was less material where purchasers knew that goods were counterfeit, the broader public and commercial harm remained. Such offences are also difficult, time-consuming and expensive to detect.

5. In the normal course, sentencing for this kind of offending should therefore include deterrence. The sentence was relatively severe, but the appellant’s mitigation did not render it manifestly excessive. The concurrent sentences and forfeiture order remained in force.

• Court of Appeal (Criminal Division): dismissed the sentence appeal in [2007] EWCA Crim 1860.
• Crown Court at Mold: following guilty pleas to false trade mark offences, imposed concurrent sentences of 18 months’ imprisonment and made a forfeiture order.