Having received compensation from them

arbitrage practice

In the Gagarinsky Court of Moscow, the trial began in the case of the general director of Spektr LLC, Evgeny Semenov, and the director of Long Stealth LLC, Maxim Deordiev, accused of illegal use of a trademark (Kommersant has been following this case since April 2003). According to the investigation, the entrepreneurs organized the production and sale in Russia of counterfeit chandeliers from the famous Austrian company Swarovski, causing it €600,000 worth of damage. However, in court, the case may end in reconciliation of the parties, since the accused are ready to compensate the Austrians for the damage caused.

The investigation into this case began when in the fall of 2002, representatives of Swarovski from the law firm Gorodissky and Partners contacted the Main Directorate for Economic Crimes of the Ministry of Internal Affairs of Russia, reporting that a number of large stores in the capital were selling counterfeit chandeliers under the Swarovski brand. Employees of the 14th department of the GUBEP checked this information and already on December 16, 2002, they detained the director of Spektr LLC, Evgeniy Semenov, who was distributing counterfeits, and a month later they interrogated the director of Long Stealth LLC, Maxim Deordiev, who was involved in their manufacture.

Entrepreneurs testified that the chandeliers were assembled in Solntsevo, at one of the military-industrial complex enterprises, and the components were received from Turkey. The chandeliers were assembled of three types: entirely from Swarovski crystal, half equipped with Swarovski pendants, and entirely from Turkish-made pendants. But since most of the chandeliers were made from Turkish crystal, a criminal case was opened against Messrs. Semenov and Deordiev on April 1, 2003 under Part 3 of Art. 180 of the Criminal Code of the Russian Federation ("Illegal use of a trademark", up to five years in prison).

In turn, the entrepreneurs admitted guilt only partially. They claimed that they were not involved in the production of crystal or frames for Swarovski chandeliers. According to Messrs. Deordiev and Semenov, their companies only assembled finished chandeliers from the Turkish components they received, which were then put up for sale. The question of whether the Turks had the right to produce goods under the Swarovski brand did not interest them.

However, as Vladimir Biryulin, a partner at the law firm Gorodissky and Partners (he represents the interests of Swarovski in court), told Kommersant, the accused Evgeny Semenov at the very first hearing presented to the court a document stating that he paid Swarovski company €30 thousand in compensation and will pay the same amount in the near future. Mr. Biryulin said that his clients intend to withdraw their application to the GUBEP to initiate criminal proceedings against manufacturers and distributors of counterfeits. Lawyers from Gorodissky and Partners have already received instructions from them to seek dismissal of the criminal case. “We don’t know what the accused agreed with our clients,” said Mr. Biryulin, “but if Swarovski wants to go to peace with the accused, we will comply.”

According to Mr. Biryulin, at yesterday’s meeting there was no reconciliation of the parties for formal reasons. The trial was postponed due to the fact that the indictment did not contain the signature of the defendant Semenov. In addition, Swarovski representatives themselves asked the court to give them additional time to familiarize themselves with the case materials. As a result, the court postponed the hearing to December 24. Obviously, the judicial investigation will be terminated on this day.

The news of a possible reconciliation between Swarovski executives and the accused Semenov and Deordiev caused a stormy reaction in the GUBEP. “They offered us much more than €60 thousand to stop the case,” said the GUBEP, “but we didn’t take it. But the Austrians bought it. In the West they like to say that we in Russia are mired in corruption and are doing nothing to stop the production of counterfeit goods , but they themselves are hindering us. After all, in order to fight this evil, it is necessary for copyright holders not to compromise with criminals.”

ALEXEY Kommersant-SOKOVNIN

Swarovski forgives pirates