Counterfeit Headphones Face the Music: Marshall wins trade mark infringement case against counterfeit retailer

Marshall, well known in the music industry for its high-quality music equipment, has successfully sued a retailer for trade mark infringement for selling counterfeit headphones. 

The company OWGH has been found liable for infringing Marshall's trade marks by selling counterfeit Marshall Major V headphones on Amazon's UK website. Marshall relied on 3 of their UK trade marks for MARSHALL and MAJOR. OWGH didn't dispute selling Marshall branded headphones but argued that: 

1. It believed the products were genuine Marshall headphones and not counterfeits. 
2. It had a defence under the concept of exhaustion. As we have previously discussed, this is where a registered trade mark is not infringed by the use of the trade mark in relation to goods which have been put on the market in the UK or the European Economic Area under that trade mark by the trade mark owner or with their consent.

Marshall Amped Up the Evidence

Marshall had conducted several test purchases from OWGH, which were key for its case. Some of these were done by Marshall and others were done by two separate third party agents. Between them they purchased, at different times, different coloured headphones from OWGH's Amazon page and all were sent to Marshall's Brand Protection Specialist for inspection. He gave detailed evidence demonstrating how all genuine headphones are given a unique serial number during manufacture, which is recorded on their secure internal system as part of a quality control process. The product cannot be shipped until the number is recorded and subsequently, if a serial number is not on their system, the product bearing that number is not a genuine Marshall product. 

He gave comprehensive evidence about his inspection process, including screen recordings of him checking the serial numbers from the test purchases on Marshall's system. He also provided clear side-by-side photographs showing the various aspects of the test purchases that did not match Marshall's genuine headphones. The differences, often very subtle, included things like materials used, colour, position of details of the headphones, depth of engraved text and packaging of the headphones. 

Marshall had 4 witnesses including its Brand Protection Specialist and Marketing Director. The Judge was very complimentary of Marshall's evidence, including its witnesses. She said the evidence was "clear and meticulous" and that the witnesses had answered her questions at trial "truthfully". In relation to the test purchases, she said the evidence showing they were counterfeit headphones was "overwhelming" and noted how helpful it was having a test purchase to see "in the flesh" at the trial. She said the long list of differences between the test purchases and the genuine Marshall headphones was "powerful and persuasive." 

OWGH Out of Tune

By contrast, the Judge was not impressed by OWGH's evidence. It's Director, Mr Stern, submitted two witness statements. In these he alleged that OWGH had purchased the headphones in issue from a third-party wholesaler in Romania. Although there were invoices to support this, there was no evidence about where the wholesaler purchased the headphones from. He put forward a number of other arguments. These included that Amazon had shipped the wrong stock and that a company in India had confirmed the products were genuine. None of these were supported by any evidence and so were dismissed by the Judge. He was also unable to provide any evidence to demonstrate the exhaustion defence and show that Marshall had consented to the headphones being sold in the UK or EEA. 

Sound Judgment

The Judge found overwhelmingly for Marshall confirming OWGH was liable for trade mark infringement and that the headphones they had sold were counterfeit. It was a resounding success for Marshall and demonstrated that its forensic approach to the test purchases paid off. It remains to be seen what action it will seek from OWGH following the judgment. It is likely they will at least seek delivery or destruction of all of OWGH's stock, undertakings to prevent similar sales in the future and full information about their suppliers, to enable them to fully investigate the extent of this particular counterfeit operation. 

Worried about counterfeits?

For brand owners worried about counterfeits, we have previously published this guide on the main enforcement routes available for you. The lesson from this case is to be proactive through a number of options:

• Keep a clear serial number registry for your products. The ability of Marshall to check its secure internal system for a unique serial number and quickly ascertain whether a product was genuine or not was powerful evidence. The Judge called the missing serial numbers the "first and foremost" reason for finding the headphones were counterfeit.

   

• Conduct several test purchases and document the process. Marshall used 2 different external companies to make test purchases, on top of their own, which were made at different times for the different colour options of the headphones. The variety of test purchases, as well as the strict security measures for the inspection of these purchases, was strong evidence to the Judge. 

   

• Monitor sellers online. Regularly check who are the most popular sellers of your products online and whether they have the correct authorisations for this. Marshall first became aware of OWGH because it had become the default seller for its Marshall Major V Bluetooth Headphones on Amazon. The default seller on Amazon is the seller who uses the "buy now" option, meaning consumers can conduct the purchase in as little as one click. As a result, they are likely to have a higher volume of sales. 

   

• Scrutinise retailers. Although OWGH had invoices to show it had purchased the counterfeit headphones from a Romanian wholesaler, it could not show any details for further up its supply chain or where any authorisation from Marshall was in that chain.  

How we can help

Whether you are dealing with counterfeits now or want to protect your brand before they appear, our IP team can help you find the right approach, from prevention through to enforcement. To discuss how we can help, please get in touch with Oliver Fairhurst or Aaron Trebble.