Solicitation campaign operator reimburses misled rights holders
New Zealand’s Commerce Commission has confirmed that it has reached an interim agreement with a trademark solicitation company to refund businesses which inadvertently paid an invoice for the publication of filed trademarks. The commission is calling for more to be done at international level to combat misleading invoices.
The campaign involved invoices sent to New Zealand business owners from a company called TM Publisher, claiming that a payment of NZ$1,600 ($1,100) was required for recently filed trademarks to be published. One private practice lawyer told World Trademark Review that around 8% of clients which received the letter had paid, assuming that it was an official invoice.
The Commerce Commission subsequently confirmed that it had frozen bank accounts belonging to the organisation and has reached an interim agreement with TM Publisher to refund any rights holder that paid the invoice from April 6 2016 ( it is still in negotiations about refunding companies that paid the invoice before that date).
A commission spokesperson explained that the move occurred after it became apparent that “many of the businesses that we have spoken with have not realised that they had paid for an online publication for their trademark” and had “also been misled because they thought they were required to pay the invoice”. As the New Zealand address given on TM Publisher’s invoice was a virtual office, negotiations were conducted by email, which subsequently led to the agreement. The spokesperson explained: “The ‘agreement’ is actually ‘interim court enforceable undertakings’ which TM Publisher offered to the Commission, which included an agreement that its bank account would remain frozen. If they had not offered these undertakings, the Commerce Commission would have had to consider other enforcement options.”
We contacted TM Publisher for comment, but received no response. Considering the substantial amount of money TM Publisher obtained as a result of its New Zealand campaign (the bank account frozen in March contained “over $NZ200,000 ($130,000) in payments from New Zealand businesses”), the commission spokesperson agreed that more needs to be done on an international level, noting that initial efforts are underway. “There is some communication between agencies internationally about this sort of conduct. Furthermore, we are aware that our overseas counterparts have also been successful, at times, in obtaining money for consumers in similar situations.”
There have been other victories in the pursuit of those behind trademark solicitation campaigns. For example, in January 2016, the US Department of Justice announced that it had indicted two men in California for a bank fraud scheme involving the proceeds of a mass-mailing scam targeting holders of US trademark registrations. However, the frequency of trademark solicitation campaigns shows no signs of abating.
For a more in-depth industry perspective on trademark solicitations, please see page 58.
Counsel comment
So many of our clients were telling us about the TM Publisher letters in the same week that we decided to send out an urgent newsletter to our local clients and contacts. We also called the Commerce Commission. One woman who saw our publicity rang to tell us she had paid two invoices totalling around NZ$3,000 for the small organisation she works for. She felt so bad for falling for the scam that she reimbursed her organisation out of her own pocket. We put her in touch with the Commerce Commission and she was able to get her money back. Ultimately, the commission have done a great job and it’s good to see them having some success against these scams.
Damian Broadley, managing partner, AJ Park