Advice needed on trademark infringement contract

[Dragon1]

Hi guys. I could really do with a bit of advice on whether or not to sign a contract for infringing on a trademark.

I created a website for a small portable toilet company, and happened by mistake to use a trademark related to this (won't say what it specifically was).

Anyway, I used this trademark in the site's meta keywords as well on a number of different pages. The site actually ranked fairly highly in Google after a short period (page 3 for a UK search with this particular keyword) and it's high ranking must have been why it was discovered.

My client received a letter including a contract to say that they would remove the trademark and everything. However, this was actually made out in my name rather than my clients (which obviously isn't good).

What is particularly worrying though is that the contract said I would cover all the legal fees incurred by the trademark company. I don't know how much this would be - does anyone have any ideas? I would presume it was simply for writing out this contract, and perhaps a bit of general legal advice.

I should probably mention that the portable toilet client hasn't gained much, if anything, financially out of using the trademark as his site has only been up for a couple of months and he only operates on a local level, rather than a national level. Furthermore, I'm only 17 and I run my web design business part time, outside of college time.

Should I sign the contract or not? I've been given the deadline of 15th September before they start formal legal proceedings, which I would presume means taking me and the client to court.

Any help would be greatly appreciated,
Dan

 

[Deleted member 13430]

I presume the trademark infrignement contract is a letter of undertaking requested by the trade mark owner that the 'infringer' is asked to sign to avoid the initiation of legal action. This is a contarct as in essence the infriger gives undertakings/compensates the trade mark owner for their undertaking not to pursue the matter further through the courts. I assume you accept there is infringement and you have put your hands up as they say.

I don't understand why the undertaking should be in your name, as your client would be deemed to be the infringer, not you in my opinion. To infringe a registered trade mark or fall foul of passing off you have to use a conflicting sign to a protected trade mark (either via registration or established via use) in course of trade. You may have designed the site and put the offending metatags in the site but you have never traded under the trade marks concerned. Your client has traded and used the mark 'in the course of trade', not you. I assume they are not claiming you are a secondary infringer? Under the Trade Marks Act, printers and the like can be held to be seondary infringers of registered marks if they knew what they were doing helped their client infringe another traders registered mark. Your client has infringed/passed off under the law, in my opinion, but not you if I understand the situation correctly. Thus the undertaking should bind them not you in my opinion. You should request that amendment in the first instance. Where did they get your name? Are you listed as the owner of the domain name registration linked to the website? I assume you don't host the site concerned at all.

As with any contract the terms must be certain and clear. A mere undertaking you will pay their pay their 'reasonable' costs is not clear. You need a figure. That should be insisted on for clarity. A reasonable figure relates to the hassle you have put the otherside to. If you have simply put your hands up striaghtaway, any figure should be low, in the hundreds of pounds field. This is probably an opening gambit, your client/you should go back to them and negotiate. It costs so much to sue someone, if you now accept that there is infringement, which I presume you accept has occured now, and agree to stop use, they will hopefully be easy going on the other provisions of the undertakings and you can negotiate a mutually acceptable agreement. Don't ignore the letter though, face it and deal with it.

I have said above you probably would not be deemed the infringer under trade mark law, that doesn't neccessarily stop your client being peeved and trying to reclaim some money off you. Did they know about what you were doing? Did they ask you to do it? Whether they can claim any money from you depends on what contracts, if any, are in place between you and them.

I strongly recommed you approach a local trade mark attorney or IP lawyer for some advise. Somebody may give you some free initial advice if you ring them up, as one can not advise with certainty without knowing all the facts.

Hope that helps and good luck!

 

[Dragon1]

Thanks for that.

Unfortunately, I did not sign any contracts with the client, as I know him personally and he was my first web design customer.

It is correct that my name was found because I was the domain owner/registrant. I also arranged to host the clients site for the first year.

The client did not insist I use this particular trademark, but it is a fairly general term that most people use to refer to portable toilets so I happened to use it, without knowing it was actually a trademark.

As soon as I was given the letter and read through it, I immediately removed the trademark from the website title and keywords and on my design portfolio on my own website.

I do hope that the client accepts most of the responsibility for this and pays himself, because as a student, I have virtually no savings and I gained only a small sum from designing the site for the client (not as much as it would cost to cover legal fees and damages etc.)

Thanks anyway,
Dan

 

[kerplink]

Could you let me know how this progressed and was resolved. I have just received a letter and undertaking and am not sure whether I need to sign it. I have no money to pay for legal advice and am very very worried by this.

 

[Lime One]

The majority of undertakings we see for clients need major adjustment and negotiation before signing. Get some advice before signing it.

 

[minithirty]

Hi,
I have recieved a letter from a soliciter saying that i have breached somebodys copyright. They have given me an undertaking to sign. It says that there reasonable legal costs will be assessed. Does this mean i will have to pay there legal costs and how much will this be. I am currently on benefits and made less than £30 using this copyright.
Please give me some advice.

 

[VeryMark]

If it says that you will pay reasonable legal costs to be assessed, then, yes, you are liable if you sign the document.

I cannot give you proper legal advice without knowing the facts and being instructed, but it sounds to me that you should not sign but go back and explain your circumstances truthfully.

 

[minithirty]

Thank you for your reply. The only thing is they have said if i do not sign they will take it to court and i could then end up with a big fine.
I listed an item on Ebay which i made and ebay never informed me when i listed it that it was a breach until a month later. When they removed.I only ever sold a couple of these items. As soon as i was made aware of this i stopped selling this item.
If you could let me know on average how much legal costs would be. I know you can not give me an exact figure but just so i know what to expect. All its says is that legal costs to be assesed and any profits i made to be assessed.

 

[VeryMark]

You should not sign it as written with any liability for costs.

My advice would be to write to them undertaking in consideration of their refraining from legal proceedings not to make any further sales of the items complained of or in future to infringe any registered trade mark applicable thereto or to pass off in relation thereto, and explaining that it was a naive mistake on your part, that sales were minimal, and that you cannot afford to pay legal costs as it was only a pin-money business which lasted for a short time.

Providing then that they have got a legally binding undertaking they can rely on it is most unlikely in the circumstances that you would face being sued to recover from you what would only be a small amount of damages which would not warrant the significant costs of legal proceedings.

 

[minithirty]

Thanks again. The only thing is the company is very big and i dont think that they would worry about how much it will cost to sue me. I own nothing and have nothing. Could i be sent to prison for this as they sent me the a summary of the law and it says that i could get a fine or get a ten year sentence. This is a very worrying time and not sure what to do.

 

[VeryMark]

Although in theory it is possible that a criminal offence might perhaps have been committed, it is most unlikely that either the police or trading standards would concern themselves with a case like this.

I would suggest that you go back to them as I have said and see what they say - whilst big corporations can be bullies it is not in their interest either to spend time and money harassing what is clearly a very small naive business that is obviously trying to be co-operative.

 

[minithirty]

I will write to them and hopefully they will understand my circumstances.
Thank you for all your help. Some of my messages are a bit late going through so i sent a couple with the same matter. I will keep you posted on how things are going.
Thanks again.

 

[jules12345]

Hi guys. I could really do with a bit of advice on whether or not to sign a contract for infringing on a trademark.

This I dont understand...!

 

[minithirty]

would you be able to tell how much the legal costs will be as at the moment i have no idea what to expect. I know you wont be able to give me an exact amount. But on average will it be in the 100s or more. Please if any one can help me on this.

 

[minithirty]

Would you be able to give me an idea at how much legals costs will be. Will it be in the 100s or more. i know you wont be able to give me an exact amount but just an idea would be great. I have no other way of finding out.

 

[VeryMark]

At this point the claimant's legal costs should at most only be in the £00's.

However, to demand the payment of their legal costs at this stage before formal proceedings have been instituted may be in breach of Rule 10.01 of the Solicitor's Code of Conduct, Guidance Note 5 to which states:

"It would be unfair to demand anything that is not recoverable through the proper legal process. This would include a letter of claim and any other communication with another party to the action. For instance, where you are instructed to collect a simple debt, you should not demand from the debtor the cost of the letter of claim, since it cannot be said at that stage that such a cost is legally recoverable."

You can of course also ask the other side to give you a specific figure before agreeing to anything.

 

[minithirty]

Thanks again.

 

[Kevin18]

hello guys, would be very helpful to know the outcome on any of these cases. was it worth writing the letter yourselves or using a solicitor to write it up? i have a similar case and would like to know the outcomes of your cases if possible?

 

[solenlil]

A reasonable figure relates to the hassle you have put the otherside to. If you have simply put your hands up striaghtaway, any figure should be low, in the hundreds of pounds field.