In a positive decision for brand owners, the UK Supreme Court has confirmed that criminal trade mark offences can apply to the sale and distribution of grey market goods in addition to counterfeit goods.

In R v M & Ors [2017] UKSC 58, the appellants had been importing clothes and shoes into the EU that bore trade marks of famous fashion brands. These were a combination of counterfeit goods and grey market goods (i.e. goods that had been produced with the trade mark owner’s consent but that had been subsequently sold without their consent).

S92(1) Trade Marks Act 1994 (TMA) states as follows:

“(1) A person commits an offence who with a view to gain for himself or another, or with intent to cause loss to another, and without the consent of the proprietor—
(a) applies to goods or their packaging a sign identical to, or likely to be mistaken for, a registered trade mark, or
(b) sells or lets for hire, offers or exposes for sale or hire or distributes goods which bear, or the packaging of which bears, such a sign, or
(c) has in his possession, custody or control in the course of a business any such goods with a view to the doing of anything, by himself or another, which would be an offence under paragraph (b).”

The question raised was whether S92(1) applied to the grey market goods as they did to the counterfeit goods. The appellants had argued that the wording of S92(1)(b) meant that the selling offence within S92(1) only applied to counterfeit goods and that the subsections of S92(1) were cumulative in their drafting. This argument was rejected by the Supreme Court, who held that the three subsections of S92(1) created three stand-alone offences, and that one does not necessarily follow the other.

This is an important ruling for brand owners, who now have another tool at their disposal when seeking to protect their rights. Previously they had been able to bring civil proceedings against grey goods, this decision now confirms that they now have an option to bring private criminal proceedings.