As a rule, destruction costs of counterfeit products are borne by party infringing trademark rights—namely party manufacturing, importing, storing, or selling counterfeit goods. Even where rights holder advances these costs during judicial and enforcement proceedings, costs are recovered at conclusion of litigation from infringing party found liable, as part of litigation costs.
Destruction costs of counterfeit products constitute one of most critical financial burdens in trademark protection proceedings. In intellectual property disputes, merely recalling products from market is deemed insufficient; physical existence of said goods must also be terminated.
What does destruction of products mean under Industrial Property Code?
Pursuant to Industrial Property Code No. 6769 (IPC), destruction of products constitutes permanent eradication of goods, production tools, or packaging that infringe registered industrial property right. Destruction serves as definitive measure aimed at preventing re-entry of counterfeit goods into stream of commerce.
Destruction order is not executed ex officio. Execution requires motion by rights holder and explicit judicial ruling by court to that effect. Mode of destruction is executed in compliance with environmental regulations via incineration, shredding, chemical dissolution, or recycling, depending on nature of product.
How are recall and destruction of counterfeit products requested?
Recall and destruction of counterfeit products are requested upon trademark owner detecting infringement, petitioning competent court for preliminary injunction, and initiating action for determination, prevention, and cessation (elimination) of infringement. In criminal proceedings, process commences with criminal complaint filed before Public Prosecutor’s Office alongside search and seizure motion.
Process fundamentally comprises following stages:
- Determination of evidence and search: Rights holder secures evidentiary determination via notary public or requests search of premises executed by law enforcement under prosecutorial authority.
- Seizure and judicial custody: Seized counterfeit products are placed into judicial custody or delivered to licensed bailee (trustee) warehouse upon advance payment of costs.
- Expert examination: Court or Public Prosecutor’s Office examines whether products are indistinguishably similar to genuine trademark.
- Judgment and destruction order: At conclusion of proceedings, court orders either transfer of ownership of counterfeit goods to public or direct destruction thereof at defendant’s expense.
Which court orders destruction of counterfeit products?
Jurisdiction to order destruction of counterfeit products lies with Civil Court for Intellectual and Industrial Property Rights or Criminal Court for Intellectual and Industrial Property Rights, depending on nature of dispute. In judicial districts where such specialized courts do not exist, jurisdiction vests in general-jurisdiction Civil Courts of First Instance or Criminal Courts of First Instance.
In civil litigation, rights holder asserts destruction of counterfeit goods as independent claim pursuant to IPC. In criminal proceedings initiated for trademark infringement offenses, forfeiture and subsequent destruction of counterfeit goods are ordered pursuant to Turkish Penal Code provisions on confiscation of property and provisions of IPC.
What costs arise during judicial proceedings?
Costs arising during judicial proceedings comprise freight expenses, bailee warehouse storage fees, expert witness fees, destruction facility handling charges, and official court fees. Magnitude of these expenses varies according to volume of seized goods, storage duration, and technical infrastructure required by destruction method.
Storage and transit expenses accumulate substantially over time:
- Bailee storage fee: Per diem custody charges incurred throughout litigation for voluminous goods (textile bales, spare parts, footwear).
- Logistics and handling expenses: Costs of dispatching goods from inspection site to warehouse, and from warehouse to destruction facility.
- Destruction facility fee: Operational charges based on tonnage or cubic meterage payable to environmentally licensed disposal facilities.
Because relevant court fees, warehouse tariff schedules, and disposal expenses are periodically updated by official authorities, applicable rates must be verified against official fee schedules in effect on filing date of action.
Who initially pays destruction costs?
Destruction and custody costs during ongoing proceedings are initially advanced by petitioning rights holder. Court or execution directorate serves notice upon rights holder specifying estimated expenses necessary to conduct proceedings, setting peremptory deadline for payment.
Failure by rights holder to deposit advance within prescribed deadline may result in discharge of seizure or lapse of preliminary injunction. Destruction of counterfeit goods is not financed directly from state treasury, save for certain hazardous substances affecting public order. Accordingly, destruction costs of counterfeit products remain financial burden of plaintiff at initial stage.
How are costs recovered from losing party?
Costs are recovered from losing party through judgment enforcement proceedings (execution of judgment) upon court’s final ruling becoming res judicata. Pursuant to Code of Civil Procedure No. 6100, litigation costs are assessed against party against whom judgment is rendered.
Rights holder submits to case file all receipts for advances deposited with court registry or execution office, warehouse rental charges, and actual destruction invoices. These amounts, expressly adjudicated in court judgment, are collected together with statutory interest by levying execution on bank accounts, immovable property, or other assets of infringing merchant or individual.
Case study: Counterfeit textile operation in tourism district
Boutique operator conducting business in Antalya offered for sale in shop hundreds of counterfeit bags bearing luxury brand logos procured from abroad without invoices. Brand’s counsel obtained search warrant from Criminal Peace Judgeship, executed search of commercial premises, and effected seizure of goods.
Proceedings lasted two years, during which hundreds of bags were held in licensed bailee warehouse. Rights holder brand paid in advance two-year warehouse fees and costs of shredding and disposing of goods at licensed disposal facility.
Court convicted shopkeeper pursuant to IPC and ordered destruction of goods. Brand owner had all logistics, storage, and destruction expenses taxed into court decree and initiated execution proceedings against local retailer in Antalya; all incurred expenses were recovered from infringing retailer by forced execution alongside accrued interest.
What are common mistakes made during process?
Common mistakes in process include petitioning Public Prosecutor’s Office directly without securing determination of evidence, failing to deposit destruction cost advances within peremptory deadlines, and delaying liquidation of goods held in judicial custody. Most significant error committed by rights holders is failure to account for compounding bailee warehouse fees when litigation becomes protracted.
Principal misconception among defendant infringers is belief that suspension of pronouncement of judgment in criminal case relieves them of destruction costs. Criminal procedural rulings such as Suspension of Pronouncement of Judgment (HAGB) do not preclude destruction of products nor indemnification of actual destruction costs recourse against defendant.
Proper management of legal proceedings remains critical to mitigating cost burden generated by warehoused goods. When formulating trademark protection strategies, securing prompt injunctive relief with assistance of practitioners experienced in intellectual property disputes—such as Attorney-Mediator Billur Güler Aslım—prevents accrual of superfluous warehouse storage charges.
Physical eradication of counterfeit products in industrial property infringements constitutes onerous and costly procedure. Although statutory framework assigns provisional financing to rights holder, properly conducted legal proceedings culminate in entirety of expense being taxed against infringing party. Strategic budgeting by IP owners for storage, transit, and destruction expenses prior to asserting claims prevents subsequent financial losses.
