Counterfeit Goods Laws: Penal Code 350 PC
Due to the strong demand for luxury brands and designer goods, California rigorously enforces intellectual property laws.
According to California Penal Code 350 PC, it is illegal to deliberately produce, intentionally sell, or knowingly possess with the intent to sell any counterfeit trademark registered with the California Secretary of State or the USPTO.
This law focuses on the underground market for counterfeit clothing, handbags, electronic parts, sunglasses, and auto components.
Law enforcement frequently partners with private investigators to carry out sting operations on social media, online marketplaces, and local swap meets.
The Esfandi Law Group can help you. Schedule your free consultation at (310) 274-6529 or use the contact form.
Quick Reference Summary Chart
|
Feature |
Details |
| Statute | California Penal Code 350 PC |
| Prohibited Acts | Manufacturing, selling, or possessing counterfeit goods with the intent to sell |
| Classification | Misdemeanor or "Wobbler" (based on quantity and total value) |
| Misdemeanor Threshold | Fewer than 1,000 items and a total value under $950 |
| Felony Threshold | 1,000 or more items or a total value exceeding $950 |
| Asset Forfeiture | Seizure of counterfeit items, manufacturing machinery, and transport vehicles |
| Core Intent Required | Knowledge that the mark is fake + intent to commercially sell the goods |
Key Elements of a PC 350 Violation
To obtain a conviction for trademark counterfeiting under PC 350, the prosecution must prove the following elements beyond a reasonable doubt:
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Willful / Knowing Possession: The defendant either manufactured, sold, or possessed the target goods, knowing or reasonably believing they were counterfeit.
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Registered Trademark: The goods featured a counterfeit mark or logo that was either identical to or closely resembled a valid mark registered with the USPTO or the California Secretary of State.
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Commercial Intent: The defendant intentionally aimed to sell or distribute the fake goods for profit. Simply owning a counterfeit item personally is not illegal.
Real-World Examples
Example 1 (Flea Market Modification): A person buys cheap, unbranded sunglasses in bulk. To boost profits, he adds fake designer logos to the frames and sells them at a local flea market as genuine luxury sunglasses. He is guilty of manufacturing and selling counterfeit marks under PC 350.
Example 2 (Online Distribution Scheme): A retailer uses a social media page to promote luxury designer handbags at significantly reduced prices. Police conduct a search at her storage unit and find 1,200 counterfeit bags prepared for shipment. Given her possession of over 1,000 fake items with evident intent to distribute, she faces felony "wobbler" charges.
Penalties and Sentencing for Counterfeit Goods
The consequences for violating Penal Code 350 PC vary based on the amount of merchandise and its overall market value.
Misdemeanor Penalties
If the offense involves fewer than 1,000 items and the total value is $950 or less, it is classified as a misdemeanor. Penalties include:
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Imprisonment of up to one year in a county jail in California.
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Fines can reach up to $10,000 for individuals and up to $200,000 for corporations.
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Informal probation summary.
Felony "Wobbler" Penalties
If a batch contains at least 1,000 items or has a total value over $950, prosecutors can upgrade the charge to a felony. The penalties for a felony include:
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16 months, 2 years, or 3 years spent in county jail under California's realignment program.
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Fines can reach up to $500,000 for individuals and up to $1,000,000 for business entities.
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Formal felony probation.
Asset Forfeiture and Prior Offenses
A conviction often results in mandatory asset forfeiture actions.
The state seizes and destroys all counterfeit items, along with the machinery or digital tools used to produce the logos, and any vehicles involved in transporting the illegal goods. Penalties become significantly harsher for defendants with previous intellectual property convictions.
Related California Laws
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Penal Code 487 PC (Grand Theft): Selling counterfeit items that mislead a buyer and cause a loss of over $950 under false pretenses could lead to grand theft charges.
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Penal Code 470 PC (Forgery): Specifically targets the falsification of signatures, seals, or official documents to falsely present them as genuine.
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Penal Code 499c PC (Theft of Trade Secrets): Addresses the illegal copying or sharing of company trade secrets.
Legal Defenses Against Counterfeit Charges
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Lack of Knowledge (Mistake of Fact): Since many contemporary counterfeit items are extremely realistic replicas, a distributor might sincerely think their stock is genuine surplus or legitimate liquidation inventory. Without awareness of the counterfeit nature, they face no criminal liability.
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No Intent to Sell: Possessing counterfeit apparel or goods for personal use, gifts, or non-commercial purposes does not breach PC 350.
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Authenticity or Unregistered Mark: If the defense can show that the items are authentic production overages or that the particular logo isn't currently registered on the federal Principal Register or at the state level, the charges will not hold.
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Fourth Amendment Violations: If law enforcement seizes merchandise through an illegal search of a vehicle, home, or storage unit without a valid warrant or probable cause, a motion to suppress can make the evidence inadmissible.
Frequently Asked Questions (FAQs)
Is it illegal to buy and wear a counterfeit item in California?
No. Penal Code 350 PC explicitly penalizes the manufacture, sale, and possession of counterfeit goods with intent to sell. Purchasing or owning a replica item for personal use is not a state crime.
How do prosecutors calculate the value of counterfeit goods?
The value is usually based on the retail price of the authentic items that the counterfeits mimic, not on the lower selling price of the counterfeit products.
Can I be charged under PC 350 if I did not physically attach the fake logo?
Yes. Having pre-made counterfeit goods, knowing they are fake, and intentionally holding them for sale is sufficient to establish a conviction.
What is the difference between trademark infringement and criminal counterfeiting?
Trademark infringement typically involves civil cases resolved via lawsuits and monetary penalties. In contrast, criminal counterfeiting under PC 350 entails intentionally deceiving consumers or the market with identical forged marks, leading to criminal charges and possible imprisonment.
What happens to the items seized during a counterfeit sting?
Once convicted, law enforcement is required to forfeit and destroy all items bearing the counterfeit mark, including any specialized tools, printers, molds, or transport vehicles used in the operation.
Speak to a California Criminal Defense Lawyer
Defending a Penal Code 350 PC charge demands a thorough knowledge of California criminal procedures and intellectual property laws. Corporate entities and law enforcement actively pursue harsh penalties in white-collar counterfeiting cases.
If you're facing an investigation or formal charges, it's crucial to get an early consultation with a qualified defense attorney.
An experienced attorney at Esfandi Law Group can evaluate the legality of the search warrant, challenge the prosecution's valuation methods, and work to lessen or dismiss the charges prior to trial.
Schedule your free consultation by using the contact form here.