1. Prosecuting Bodies and Process
Criminal Proceedings may be either summary or on indictment. The prosecuting body is either the Magistrates’ court, which is presided by local Justices of the Peace for summary offences and they hear the case alone having heard evidence from both parties. Indictments are dealt with by the Crown Prosecution Service in the Crown Court, where a jury will decide the outcome.
2. Offences against HMV?
Under the Sale of Goods Act 1979 the vendor has an obligation to provide a refund where the goods are not fit for the purpose, they are not of satisfactory quality or do not conform to description or sale by sample.
This therefore means that goods that are not what the buyer really wanted do not require the seller to refund outright. HMV has acted upon a goodwill policy and there can be no criminal recourse for misuse.
3. Offences against Copyright owners
(a) Copyright, Designs and Patents Act 1988
Section 107(1) states that it is an offence to make for sale or hire in the course of a business or distribute an article which is known or reasonably believed to infringe copyright. Section 198(1) of the 1988 Act states that it is an offence to sale or hire or in the course of a business, sell or lets for hire or offer or exposes for sale or distribute a recording which is known or reasonably ought to be known as an illicit recording.
Summary Conviction offences under ss 107(1)(a) and 107(1)(d)(iv) are subject to a imprisonment for a maximum term of six months or a fine no higher than the statutory maximum or both. On indictment there is an unlimited fine or imprisonment not exceeding ten years or both. For the s 107(1)(d)(i) offence, there is a summary conviction to imprisonment for no longer than six months and fines are calculated at level five on the standard scale or both.
Section 198(1) offences are stipulated under s 198(5) and are the same as penalties for ss 107(1)(a) and 107(1)(d)(iv) offences.
None of the chapter III, 1988 Act defence are applicable. Authorisation or consent by the owner to carry out the business by Al Gee on e-bay will constitute the only possible defence.
No offence is committed under s 198(1) where the act is carried out within the ambit of a provision of Schedule 2 to the 1988 Act however none are applicable to the current case.
4. Trading Standards Offences
(a) Trade Marks Act 1994
Section 92(1) stipulates that it is an offence to apply to goods or their packaging an identical trademark or sell or let or offer or expose for sale in order to gain or intend to cause loss to another. It is also an offence to have such items in possession within the course of business.
Section 92(6) stipulates the penalties, which are identical to offences under s 107(1)(a) and 107(d)(iv).
The trademark has to have been registered in the UK or has a reputation there so that use is detrimental to the reputation of the mark. Another defence is that the perpetrator reasonably believed that his use of the mark was lawful. This is unlikely to work for Al Gee who has made pirate copies and re-distributed them!
(b) Trade Descriptions Act 1968
It is an offence under s 1 to apply in the course of business a false trade description to any goods. Under s2, trade description includes indirect indications as to the person who manufactured the goods and the date of manufacture. Al Gee is creating copies of DVDs and re-producing their covers which contain details of manufacture of his master copies. There a maximum two year sentence on indictment but when dealt with by the magistrates, there is only a fine. This is a strict liability offence with two defences. One is that Al Gee made a mistake or an accident or relied on information supplied. The second is that he did not know that the goods did not conform to description and that due diligence would not have revealed the truth of the matter.
Question 2 – Civil Law
1. Plaintiffs and injured parties
Parties to the contract may sue. In tort, this principle extends to all who are owed a duty of care as explained below.
The neighbour principle of Donoghue v Stevenson states that there is a duty of care to third parties where it is reasonably foreseeable that they may suffer injury as a result of negligence.
Al Gee acted negligently by placing an 18 certificate movie in a U certificate packaging. A defence is that he could argue that there is no reasonable forseeability of injury to the children. It IS however reasonably foreseeable that the ‘children’s’ film would have been watched by children and damages are payable for this tort.
The claim will be heard by the County Court, presided over by a district Judge, who will decide the case alone. If the claim if for less than 5000, it will be dealt with by the ‘Small Claims Track’. If the claim is complex, it will be dealt with by the High Courts’ Queens Bench Division most likely by a lone Judge. This action is begun by writ, which is accompanied by a statement of claim where the details of the legal dispute are set out.
All civil damages are for restitution, whereby the sum payable reflects the amount required to place the injured party into the position they were in prior to the tort. This would therefore entail all directly applicable sums for restitution, including professional counselling, transport costs to psychiatry and parental time off work on account of the injuries.
(b) Sale of Goods and Consumer Protection Provisions
There has been a breach of the implied term that goods will comply to sale by description whereby the parents are entitled to a full refund. Unfortunately the Consumer Protection Act 1987 only allows people to claim compensation for injury caused by defective goods. The Consumer Protection, (Distance Selling) Regulations 2000 provides that there is a three month cancellation period where adequate information about the goods was not provided in a contract concluded at a distance. If the Al Gee fails to conform, the buyer may apply for the court to grant an injunction to secure compliance.
Sale of Goods Act 1979
Copyright, Patents and Designs Act 1988
Consumer Protection Act 1987
Trade Marks Act 1994
Trade Descriptions Act 1968
Consumer Protection, (Distance Selling) Regulations 2000
The Copyright, etc. and Trade Marks (Offences and Enforcement) Act 2002
Donoghue v Stevenson  AC 562
B Gumpert and J Kirk, Trading Standards, Law and Practice, (Jordans, 2001)
E McKendrick, Contract Law, Text, Cases and Materials, (Oxford University Press, 2003)
D Bainbridge, Intellectual Property, (Longman, 5th edition, 2002)
F F Thorne, 2A user’s guide to Copyright, (Butterworths, 5th edition, 2000)
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