Global Edition

Prison sentences for counterfeit equipment dealers

12.30am 20th November 2006 - Management Topics

The U.S. Golf Manufacturers Anti-Counterfeiting Working Group (comprised of Acushnet Company, Callaway Golf, Cleveland Golf, Nike Golf, PING and TaylorMade Golf Company) reports that so far in 2006, in three separate criminal cases in the People’s Republic of China, the Shanghai District Courts have sentenced four dealers of counterfeit golf equipment to prison terms of between one to three and a half years.
The Golf Manufacturers Anti-Counterfeiting Working Group was formed to petition governments to enforce their laws against counterfeiters of golf equipment products. Following the Group’s petitioning efforts, dozens of successful raids of manufacturing, assembly and retail facilities have been conducted by Chinese law enforcement authorities over the past two and a half years. Several business operators have been arrested by the authorities and many have now been prosecuted in the Chinese courts.
In February, Mr. Xie Fuping (“Xie”), an operator of the golf shop named “Shanghai Ou Hai Golf Accessories,” pleaded guilty to selling counterfeit golf equipment bearing the registered trademarks of members of the U.S. Golf Manufacturers Anti-Counterfeiting Working Group. Xie was sentenced to imprisonment of 1 year (suspended for 1 year) by the Shanghai Pudong District Court.
At the end of March, the Shanghai Zha Bei District Court convicted two defendants of selling counterfeit golf equipment. The first defendant, Ms. Bai Hong (“Bai”), was fined RMB20,000 and sentenced to imprisonment of 6 months (suspended 1 year). The suspended sentence was due to Bai’s cooperation with the authorities that resulted in the arrest of a second defendant, Mr. Chen Hu (“Chen”). Chen was sentenced to three and a half years‘ imprisonment and fined RMB30,000. Bai had been arrested in November 2005 by officers of the Shanghai Public Security Bureau as she was delivering 74 sets of counterfeit golf clubs. As a result of the arrest, Bai provided information that led to the arrest of Chen and the seizure of a further 1,344 counterfeit golf clubs from Chen’s premises, valued in aggregate at RMB208,928.
In the most recent case in August, the Shanghai Changning District Court convicted a golf club distributor, Mr. Yang Yongshen (“Yang”), of selling counterfeit golf equipment. Yang was sent to prison for 18 months and fined RMB30,000. Yang, 26, was found to be a major supplier of counterfeit golf clubs in Shanghai and had been arrested in March 2006 during a joint raid conducted by officers from the Shanghai Administration for Industry and Commerce and Public Security Bureau.
Officials seized a total of 1,755 counterfeit golf clubs from Yang’s warehouse together with various semi-completed counterfeit clubs and counterfeit golf accessories – valued in aggregate at RMB4.7 million.
According to Loo Shih Yann, a principal with the international law firm of Baker and McKenzie who is coordinating the petitioning efforts on behalf of the U.S. Golf Manufacturers Anti-Counterfeiting Working Group in China, “An important part of the Shanghai Changning District Court ruling was that the Court found the defendant guilty of the crime of `attempt‘” (based in large part on the amount of inventory of counterfeit golf products in the defendant’s possession). Loo also commented that the court decisions and the bases of the criminal convictions are very encouraging. “The Court’s growing acceptance to value the infringing goods based on the aggregate value of the genuine articles will make it easier to pursue criminal prosecution.” He added, “We believe that these court decisions and in particular prison sentences send a very important message to counterfeiters that the law enforcement authorities in Shanghai are very serious in fighting intellectual property rights violations. We hope that such law enforcement activities will continue in Shanghai and will be followed in other regions of China.”
The U.S. Golf Manufacturers Anti-Counterfeiting Working Group consists of the world’s leading golf equipment manufacturers. Its members and brands include Acushnet Company – Titleist, FootJoy and Cobra Golf; Callaway Golf – Odyssey, Top-Flite and Ben Hogan; Cleveland Golf – Never Compromise; Nike Golf; PING; and TaylorMade-adidas Golf – Maxfli.

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