Lee, a former Hermes sales lady at the Hermes Boutique in Taipei’s Formosa Regency Hotel, was convicted by the Taiwan Intellectual Property Court in April 2009, pay a compensation award of NT$256 million (US$7.7million) to Hermes International SCA for selling four counterfeited Hermes “Haut a Courroie” and “Birkin” bags in Taiwan during the period from 2004 to 2005; further, Lee is to publish an apology to Hermes and her clients. The amount was the highest compensation sought by the court against an individual who sells counterfeits, and proved to show the Taiwan’s government’s determination to clean up counterfeiting activities in the country.
According to the reports, Lee after leaving her employment with Hermes in early 2000, took a copy of the Company’s VIP list without prior consent, and approached several clients claiming she has means to obtain Hermes bags for them. Lee bought four counterfeited Hermes bags from overseas sources, and sold two through two second-hand shops in Taiwan, and two other to the clients on the VIP list. The four counterfeits were sold for a total of NT$2.05 million (US$60,000), or an average price at NT$512,500 (US$15,150), whereas a real Hermes Birkin bag may be worth at least US$7,500 apiece.
Per Article 63 of the Taiwan Trademark Act, a trademark owner may claim its compensation or damage by choosing one of the below methods:
- Damages may be claimed in pursuance with Article 216 of the Civil Code (referring to damage or loss of profit). However, in the event where evidence cannot prove the damages thereof, the trademark owner may use the profit normally gained from using its registered mark to subtract the profit gained from the same trademark after infringement, and claim the difference as the amount of damage;
- Damages may be claimed in accordance with the profit gained from trademark rights infringement. However, where no evidence on costs or necessary expenses can be proved by the infringer, the total amount of sales from selling the infringing goods shall be regarded as the amount of profit; or
- Damages may be claimed in an amount equivalent to 500 or 1,500 times of the unit retail price of the infringing goods. However, in the case where 1,500 pieces of infringing goods are found, the amount of damage to be claimed shall be assessed based on the total sale price of the infringing goods.
In the ruling, the court based the damage by referring to the above #3, and imposed a sum equivalent to 500 times the amount Lee received from selling the four counterfeits.
Also, the court covered Lee’s criminal responsibility for defrauding her customers, and ordered her to serve a six-month sentence on three years’ probation.
