UK Court of Appeal Ruling Clarifies Intellectual Property Enforcement Against Counterfeit Goods
It is undeniable that Intellectual Property is an important asset for creators and companies alike. Strong brand protection and enforcement is important, because without it, the creative industry, research and development and entrepreneurism are likely to stagnate.
Whilst less common today, for many years it was not uncommon to see ‘copied’ or arguably counterfeit products being sold across the UK and in many territories. These often imitated well known designer brands such as Ralph Lauren, Gucci and Coco Chanel.
Whilst there is no truly acceptable level for infringements of this nature, and they are unquestionably infringements, because there is no permission to reproduce branded products without a licence, brands need to determine what is the acceptable line before enforcing their Intellectual Property Rights (IPR).
Iqbal-v-City of Wolverhampton
This article outlines the case of Majid Iqbal and Muhammed Iqbal-v-City of Wolverhampton Council [2025] EWCA Crim 498, in which the Iqbal’s were accused of operating an illegal enterprise that sold counterfeit products through online platforms. The significance of this case highlights the legal implications of selling counterfeit goods and the enforcement of intellectual property law.
Background
Majid Iqbal and Muhammed Iqbal were implicated in the operation of an illicit enterprise that trafficked counterfeit merchandise, including products from brands such as Apple, Samsung, Sky, Nike, Converse, and various cosmetics, through online retailer platforms such as Amazon and eBay.
A Trading Standards investigation suggested that the Iqbal’s actions had resulted in estimated losses of £2,000,000 to the intellectual property rights holders. The charges levied against Iqbal were as follows:
- Conspiracy to sell, offer, expose for sale, or distribute goods bearing a sign identical to a registered trademark (Counts 1, 3, 5, and 7).
- Conspiracy to possess goods bearing a sign identical to a registered trademark (Counts 2, 4, 6, and 8).
- Conspiracy to mark, import, export, or use products copying a design registered under the Registered Designs Act 1949 (Count 10).
- Conspiracy to transfer and/or convert property (Count 11).
Additionally, Majid Iqbal was charged with one count of possession of goods bearing a sign identical to a trade mark, contrary to section 92(1)(c) of the Trade Marks Act 1994 (Count 12).
The evidence presented encompassed photographs, importation delivery details, advertisements, correspondence with customers, financial data, online sales records, test purchases made by the Trading Standards, and customer feedback which illustrated that customers perceived the items as genuine.
On 20th December 2023, they were convicted at Wolverhampton Crown Court, and on 15th March 2024, both defendants were sentenced to 31 months of imprisonment per offence, to run concurrently.
Court of Appeal
The Defendants sought to appeal their conviction (the appeal being limited to Count 10) which pertained to a conspiracy to mark, import, export, or use products that copied a design registered under the Registered Designs Act 1949. Defence counsel submitted that the prosecution had failed to establish that the defendants were aware that the earphones were infringing at the time of the agreement, citing the precedent set in R v Saik.
The Court of Appeal rejected this submission and upheld the trial Judge’s view that the earphones constituted “unidentified property” at the time of the conspiracy agreement.
The Court of Appeal affirmed that it was only necessary for the prosecution to establish intent, not knowledge, under section 1(2) of the Criminal Law Act 1977.
Majid Iqbal and Muhammed Iqbal also appealed the sentencing, arguing that the Judge’s harm assessment, based on the retail value of genuine AirPods was grossly disproportionate. The Iqbal’s submitted that a lower valuation based on the actual sale price of the counterfeit goods should have been applied. This submission was also rejected by the Court of Appeal where it affirmed the Sentencing Guidelines allow for harm to be assessed using the retail value of genuine goods unless it is “grossly disproportionate,” which was not the case here. The initial Judge’s evaluation was deemed reasonable, and the 31-month sentences were upheld.
Subsequently, on 17th April 2025, the Court of Appeal dismissed the appeals.
Implications for Future Cases
This judgment provides significant clarification on the application of conspiracy law in intellectual property cases. It reaffirms the following principles:
- Sufficiency of Intent: For conspiracy convictions involving unidentified property at the time of agreement, intent alone is sufficient. Prosecutors are not required to prove that the goods were infringing or that the defendants were aware of the infringement at the time the agreement was made.
- Inference from Subsequent Conduct: Subsequent actions, such as the marketing and sale of infringing goods, can be utilised to infer the existence and nature of the conspiracy agreement.
- Validity of Sentencing Based on Retail Value: Sentencing based on the retail value of genuine goods remains valid, even when counterfeit items are sold at significantly lower prices. Adjustments for disproportionality will only be considered in exceptional cases.
The ruling strengthens the ability of enforcement agencies to pursue counterfeit and design infringement cases, particularly those involving online marketplaces and international supply chains.
Stuart Southall Comments:
"IP protection is important for brands and society. It is a considerable and valuable asset for companies, and it is imperative that protection is undertaken. While criminal prosecutions for IP infringement are not an everyday occurrence, the fact is they do happen. When a criminal determination is made because the threshold is rightly higher, there is the possibility that civil action will ensue, due to the unfair commercial advantage taken by such traders and the overall detriment to the IPR holders.
One point to note is that the Court is referring to copyright infringement. While this is significant, it was actually a side-issue compared to what Iqbal was charged with. Registerable IP takes many formats, and for a company such as Apple, aesthetics are everything. Alongside copyright protection and trade marks, Apple also holds a number of registered designs. Registered designs are different and standalone. It is unregistered designs that lean heavily on copyright protection, whereas registered designs provide different protections to IPR owners."
How can we help you?
At KANGS, our experienced team of intellectual property lawyers is a trusted partner in resolving complex intellectual property disputes and supporting the commercialisation of IP assets.
Our skilled lawyers offer strategic, tailored legal guidance across all areas of intellectual property, including trade marks, copyright, patents, registered designs, and the licensing and exploitation of our clients’ intellectual property rights.
We understand the importance of protecting your intellectual property. Successfully navigating IP disputes requires specialist legal insight and a proactive approach. Our team is committed to providing effective solutions to enforce and defend your Intellectual Property Rights.
In addition, our regulatory defence team is skilled in acting for individuals and corporations in Trading Standards investigations as well as acting for traders accused of IPR infringements by IPR holders.
Should you require assistance with an intellectual property matter, please do not hesitate to get in touch using the contact information provided below.
Tel: 0333 370 4333
Email: info@kangssolicitors.co.uk
We provide initial no obligation discussion at our three offices in London, Birmingham, and Manchester. Alternatively, discussions can be held through video conferencing or telephone.
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