Two Chinese companies are severely sentenced for counterfeiting UK-based Hopkinsons valves.
In a rare case against counterfeit
products, a Chinese court recently handed down criminal sentences and monetary
fines of unprecedented severity against two companies and their managers for
counterfeiting UK-basedHopkinsons valves, which are
manufactured and sold worldwide by The Weir Group PLC.
The two Chinese
companies, Yangzhou Yikai Machinery and Engineering Co. Ltd. and Shanghai
Saimeng Mechatronic Engineering Co. Ltd., had been making and selling counterfeit
Hopkinsons-branded valves since 2006. The defective products quickly failed in
service at Chinese power stations, causing serious injuries and damage. In
2009, the companies’ managers were arrested by China's Public Security Bureau
(PSB) following in-depth investigations.
The case went to
criminal trial in the Yangzhou Intermediate People's Court in Jiangsu, China
last December, and the prosecution proved that these valve products were counterfeit, failed
to comply with compulsory national standards and were of poor quality. In
addition, the defendants misrepresented their manufacturing location by telling
customers that they were imported from the UK. The total sales generated from
this illegal business operation exceeded RMB 11 million (approximately $1.7
The first company,
Yangzhou Yikai Machinery and Engineering Co. Ltd., was found guilty of making
and selling substandard goods and engaging in illegal business, and has been
ordered to pay a fine of approximately $1 million. Yikai's manager was found
guilty of the same crimes, sentenced to 15 years and 6 months imprisonment, and
ordered to pay approximately $2 million.
The second company,
Shanghai Saimeng Mechatronic Engineering Co. Ltd., has been found guilty of
similar crimes and ordered to pay a fine of approximately $77,000. Saimeng's
manager was found guilty of the crimes of manufacturing and selling substandard
goods, engaging in illegal business and counterfeiting trademarks. He has
been sentenced to 16 years imprisonment and ordered to pay $2.08 million.
"It has taken us
more than a year of perseverance, but the outcome of this case is reassurance
to our employees, customers and shareholders that the unauthorized use of our
trademarks will not be tolerated,” saidAlan Mitchelson,
legal and commercial director of The Weir Group. “Such high fines and long
criminal jail sentences are very rare in China for intellectual property
crimes. The Weir Group greatly appreciates the support of police, prosecutors
and Courts in China
who have taken resolute enforcement actions against these counterfeiters
including the seizure of these defective, counterfeit products.”
Cyril Leung, managing director
of Weir China,
added, "Counterfeiting not only negatively impacts the economy and innovation,
but also puts customers and users at great risk. Time and time again
substandard counterfeit products have caused industrial down time and risk to
human life. This case again highlights the importance to be placed on
quality and safety."