The amount of compensation to the trademark owner for the sale of counterfeit goods should not be calculated solely on the basis of the cost of the license agreement or the norms of the Civil Code – the Supreme Court of Russia.

In 2018, during a test purchase, an individual entrepreneur Galina Shemonaeva was caught selling counterfeit goods worth 165 rubles ($2.5) – a throttle position sensor for a car marked by Rikor Electronics trademark.

Ricor Electronics went to court. To the lawsuit sales and cash receipts, as well as video of the purchase and counterfeit goods were attached. The rightsholder demanded compensation in the amount of 50 thousand rubles ($676) for violation of exclusive rights to a trademark.

However, then the plaintiff increased the amount of the claim – up to 180 thousand rubles ($2432), that is, up to twice the size of the fixed remuneration of the licensee, since under similar license agreements the remuneration amount to 90 thousand rubles.

The defendant did not agree with this amount. Shemonaeva pointed out that the license agreement does not confirm the price of the right to use the trademark owned by the plaintiff under comparable circumstances. She noted that the contract was concluded for an unlimited number of goods and for long-term use of the trademark. She also violated exclusive rights once and one product at a time.

The court agreed with the entrepreneur that the compensation of 180 thousand rubles for a single sale of counterfeit goods for 165 rubles is disproportionate and decided to recover the minimum amount of compensation for such a case, established by the Civil Code – 10 thousand rubles ($135).

However, the Court of Appeal indicated that the entrepreneur, claiming that the compensation was excessive, did not prove this in any way: for example, it wasn’t provided other licensing agreements or information about the price that, under comparable circumstances, is usually charged for the fair use of a trademark. Based on this, the court of the second instance satisfied the claim in full. The Intellectual Property Court also agreed with this conclusion.

Shemonayeva filed a cassation appeal with the Supreme Court. At the same time, the entrepreneur provided a counter-calculation of the amount of compensation based on the license agreement – according to it, the cost of the lawful use of the trademark was 44 rubles. on the day, which gave compensation for the violation in the amount of only 88 rubles.

The defendant emphasized that a similar formula was confirmed by the Intellectual Property Court in 2017.

The Supreme Court overturned the decisions of the previous three courts and sent the case back to the first instance court for a new trial. Now the court will have to calculate the amount of compensation based on the calculation of the real cost of using the trademark, and not the amount of the license fee declared by the plaintiff or the amount established by the Civil Code, as the court from the outset did.