THE FIRST TRADEMARK CRIMINAL CONVICTION IN PANAMA
First Criminal Trademark Conviction Under
the "Industrial Property Law” in Panama
By: Jose Francisco Vega
Panama City, Panama. The conviction of the owners of three stores, for criminal infringement of a trademark consisting in the sale or offer to sale of products bearing counterfeited or illegitimately applied trademarks, in violation of Title VII, Single Chapter, Article 164, Number 9 of Law 35, was recently issued. This is the first conviction under the Industrial Property Law ("IPL"), enacted in 1996. The defendants, two Panamanian businessmen, pleaded innocent in the Fourth Circuit Court in Panama City, Panama. At the time of the plea, the defendants denied that in 1997, they illegally imported and offered for sale counterfeit shirts in their stores. The judge sentenced the defendants on Wednesday, February 24, 1999, in the Fourth Circuit Court in Panama City.
J. Vega & Asociados, representing Alain Delon Diffusion S.A. brought the case to law enforcement officials after they were informed that a store of Ultra Moderna, S.A. located at Panama City’s largest shopping center, Los Pueblos, was selling extremely cheap shirts under the trademark AD Alain Delon. The firm began an investigation and confirmed that counterfeit shirts were offered for sale at the store. A search warrant was executed on the defendants’ store in Los Pueblos, and authorities seized a variety of shirts with counterfeit trademarks. Additional evidence was collected at two other locations of the same domestic group of stores. The trademark on the shirts seized at these stores is the property of Alain Delon Diffusion S.A. The defendants were sentenced to 18 months imprisonment, fines and other penalties, as provided by Article 384, Title XII, Chapter IV, of the Criminal Code. On April 28, 2000 after defendants appealed, the Second Superior Court of Panama sustained the Fourth Criminal Circuit Court’s decision. The defendants contested the new sentence after the Criminal Hall of the Supreme Court, but on October 3, 2000 the Hall denied the claim. The seized goods were confiscated and, after removal of trademark labels, assigned to a non-profit charitable organization
The IPL was signed into law by President Ernesto Perez Balladares in May 1996, making it illegal to import, distribute, sell or offer to sell counterfeit goods, even if the defendant acts without a commercial purpose or for private financial gain. If the defendant incurs in infringement of trademarks, he or she can be charged with a felony, and faces a sentence of up to 2 years imprisonment, a fine of up to $200,000, and suspension of his or her business permit for up to 3 months, among other penalties.