Texas trademark counterfeiting — Penal Code § 32.23

Trademark counterfeiting under Texas Penal Code § 32.23 makes it a crime to intentionally make, sell, advertise, or possess for sale goods that carry a counterfeit mark. The offense is a value ladder: it runs from a Class C misdemeanor to a first-degree felony based on the aggregated retail value of the counterfeit items.

The controlling statute

Trademark counterfeiting sits in Chapter 32 of the Texas Penal Code — Fraud — in the same subchapter as forgery and deceptive business practices. It is the criminal-side companion to civil trademark law: instead of a lawsuit over lost sales, it puts a person who trafficks in fake-branded goods in front of a Texas judge. The heart of the offense is in Section 32.23(b):

“A person commits an offense if the person intentionally manufactures, displays, advertises, distributes, offers for sale, sells, or possesses with intent to sell or distribute a counterfeit mark or an item or service that bears or is identified by a counterfeit mark.” — Tex. Penal Code § 32.23(b)

A “counterfeit mark” is a mark that is identical to, or substantially indistinguishable from, a protected mark, used without the trademark owner’s authorization. A “protected mark” is a trademark or service mark registered with the United States Patent and Trademark Office, registered with the Texas Secretary of State, registered in another state, or otherwise protected under the Business & Commerce Code. The reach is broad: knockoff handbags, sneakers, jerseys, watches, electronics, phone accessories, cosmetics, auto parts, and counterfeit fitness or software media all fall inside it, whether the goods are sold at a flea market, out of a storefront, or through an online listing.

Subsection (c) gives the State an evidentiary shortcut — a state or federal certificate of registration of the mark is prima facie evidence of the facts stated in the certificate, so the prosecutor can prove the mark is protected with a document rather than a live witness from the brand. Subsection (d) is the provision that turns a table of knockoffs into a felony: when items are counterfeited under one scheme or continuing course of conduct, the conduct may be treated as one offense and the retail values aggregated to set the grade.

What conduct does § 32.23 criminalize?

The verbs in subsection (b) sweep in the whole supply chain, not just the final cash sale. Manufacturing, displaying, advertising, distributing, offering for sale, selling, and possessing with intent to sell or distribute are each independently enough. The offense is not limited to the person who prints the fake label — it reaches the wholesaler moving cartons, the vendor with a folding table, and the reseller who lists “authentic” branded goods online.

Two features matter for defense. First, the statute punishes possession with intent to sell or distribute, so a completed sale is not required — inventory in a storage unit or a car trunk can be charged if the State can prove the intent. Second, the culpable mental state is “intentionally.” As explained below, Texas appellate law treats that word as a real element the State must prove, not a formality — a person who genuinely believed the goods were genuine has a defense the statute itself recognizes.

What the statute does not require is actual confusion by a real buyer, or proof that the trademark owner lost a specific sale. Those are questions for a civil trademark case. The criminal offense is complete when a person intentionally deals in an item bearing a mark that is identical to or substantially indistinguishable from a protected mark.

Classification & punishment range

Section 32.23(e) grades the offense entirely by the aggregated retail value of the counterfeit items or services — the actor’s regular selling price for the goods. The ladder mirrors the theft ladder the Legislature reset in 2015, running from a fine-only Class C misdemeanor up to a first-degree felony. Because values aggregate under subsection (d), a large inventory of low-priced fakes can push the case up several rungs at once.

The practical takeaway is that value is the whole ballgame. Two identical seizures can produce a misdemeanor citation or a felony indictment depending on how the State counts and prices the goods — which is why the retail-value calculation, and how the items were aggregated, are among the first things a defense lawyer attacks.

Elements the State must prove

Every element must be proved beyond a reasonable doubt. For a prosecution under § 32.23(b), the State must establish:

1. A culpable mental state — “intentionally”

The accused acted intentionally. Texas courts have rejected the argument that § 32.23 is a strict-liability crime; the word “intentionally” is an element, and the defendant’s knowledge or awareness that the goods were counterfeit is fair game at trial.

2. A prohibited act

The accused manufactured, displayed, advertised, distributed, offered for sale, sold, or possessed with intent to sell or distribute. Possession with intent to sell is enough — no completed sale is required — but intent to sell or distribute must be proved for the possession theory.

3. A counterfeit mark on the item or service

The mark must be identical to or substantially indistinguishable from a protected mark, used without authorization. The State often proves the mark’s protected status through a certificate of registration, which subsection (c) makes prima facie evidence.

4. Retail value (for grading)

To lift the offense above a Class C misdemeanor, the State must prove the aggregated retail value falls within the range alleged in the charging instrument. Value is the actor’s regular selling price, and separate items count together only where the one-scheme aggregation rule of subsection (d) applies.

How Texas courts have interpreted § 32.23

Reported Texas decisions construing the trademark-counterfeiting statute are relatively few, but two are directly useful to the defense — one on what the State must prove about intent, and one on how these cases are investigated and searched.

Intent is an element — the statute is not strict liability

In Nazemi v. State, 28 S.W.3d 806 (Tex. App.—Corpus Christi 2000),² the defendant sold counterfeit-marked jewelry and argued on appeal that the statute, as written, created a strict-liability crime — that a seller could be convicted with no proof of a guilty mind. The Court of Appeals disagreed. Reading the section as a whole, it held that the statute “expressly includes a culpable mental state by providing that a person commits an offense if the person intentionally sells a counterfeit mark,” and it distinguished the intentional-selling mode from the mode that reaches a mark the seller “should have known” was counterfeit. The court also confirmed that an indictment tracking the statutory language properly alleges the required mental state.

On sufficiency, Nazemi is a roadmap in both directions. The court explained that “proof of knowledge is an inference drawn by the trier of fact from all the circumstances,” and it upheld the finding of intent on facts that included the seller’s retail sophistication, his years of business experience, and testimony that the counterfeit imagery was of poor quality and easy to spot on visual inspection. The lesson for a defendant is that intent is provable circumstantially — but it is also contestable circumstantially. Where the goods are convincing copies, where the accused is a downstream reseller with no special training in authenticating brands, or where the purchase paperwork suggests a genuine-goods belief, the same inference the State relies on can be turned against it. Notably, a concurring justice would have gone further and read the statute to require no knowledge of counterfeit status at all — a split that underscores why the mental-state instruction and the wording of the charge matter in every § 32.23 trial.

Search warrants and the four corners of the affidavit

In Lee v. State, No. 04-14-00638-CR (Tex. App.—San Antonio Mar. 18, 2015) (mem. op., not designated for publication),³ the San Antonio Court of Appeals affirmed a trademark-counterfeiting conviction over a challenge to the search of the defendant’s home. The investigation was a familiar one: an officer found an online listing for a counterfeit “Insanity” fitness product advertised at $95 when the genuine retail price was $118, made a controlled buy, inspected the item and doubted its authenticity, confirmed with the brand’s legal department that it was counterfeit, and later watched the defendant leave his house carrying a package before another undercover sale. Reviewing only the four corners of the warrant affidavit under a deferential standard, the court held those facts established a fair probability that evidence of trademark counterfeiting would be found in the home.

For a defendant, Lee marks both the target and the opening. Because the magistrate’s decision is judged solely on what is inside the affidavit, a suppression motion lives or dies on that document — the reliability of the “authenticity” determination, the strength of the nexus between the sales and the place searched, and the freshness of the surveillance are all litigable. When the affidavit rests on a thin or conclusory statement that goods were “counterfeit,” the four-corners rule cuts for the defense.

Retail value, aggregation & proof

Because grade is set by value, the retail-value proof is where many § 32.23 cases are won or narrowed. The statute measures value by the actor’s regular selling price for the counterfeit item or service — not the price of the genuine branded product, and not an aspirational figure. That distinction can move a case across a grade line when the State prices seized fakes as if they were authentic goods.

The aggregation rule in subsection (d) is the second pressure point. It permits the State to add up the retail values of many items only when the counterfeiting was committed “pursuant to one scheme or continuing course of conduct.” If the charging instrument fails to allege a single scheme, or the evidence shows separate, unconnected transactions, the aggregation can be challenged — and without it, a stack of individually low-value items may not clear the felony threshold at all. Counting, pricing, and the scheme allegation are therefore litigated together, often through the seizing officer’s inventory, the valuation methodology, and cross-examination on how the total was built.

Defense strategies

L and L Law Group builds § 32.23 defenses around the statute’s own elements and the value math. Common theories include:

• No intent — genuine-goods belief. The mental state is “intentionally.” A reseller who bought inventory believing it authentic, with invoices or supplier records to show it, attacks the element the State must prove. Nazemi confirms intent is inferred from circumstances — and those same circumstances can negate it.
• The mark is not “counterfeit” or not “protected.” Grey-market goods, licensed overruns, refurbished items, and lawful comparative or descriptive uses are not the same as a counterfeit mark. If the State cannot prove the mark is identical to or substantially indistinguishable from a currently protected mark, the case fails.
• Retail-value and aggregation challenges. Contesting the regular-selling-price valuation, the count, and the one-scheme aggregation can drop a felony to a misdemeanor — or below the confinement line entirely.
• Motion to suppress. As Lee shows, these cases often ride on a search warrant judged within its four corners. A weak nexus, a stale affidavit, or a conclusory “counterfeit” determination are grounds to suppress the seized inventory — frequently the whole case.
• Possession without intent to sell. Where the theory is possession, the State must prove intent to sell or distribute. Personal use, a single item, or the absence of pricing, packaging, and volume can defeat that inference.
• Chain of custody and identification. The link between the person, the specific goods, and the online account or storefront is contestable with forensics and cross-examination, particularly in shared-inventory or third-party-seller situations.

The right theory depends on the facts, the seizure, and the charging instrument. A full defense playbook — suppression, pretrial diversion, grade reduction, and trial — is collected in our Texas criminal defense strategies guide, and the property-and-fraud focus of this offense is handled through our white-collar and fraud defense and theft charge defense practices.

Counterfeiting vs. theft, fraud, forgery & card abuse

Trademark counterfeiting overlaps with several neighboring property crimes, and prosecutors sometimes stack counts from a single course of conduct. Knowing the lines helps target the defense.

• Theft (§ 31.03) punishes unlawfully appropriating another’s property. Counterfeiting is not about taking a physical thing — it is about trading in fakes — but the two share the same value ladder, and organized-retail-theft rings are frequently charged with both.
• Deceptive business practices (§ 32.42) is the adjacent fraud offense: misrepresenting the kind, grade, or quality of goods in the course of business. Selling fakes as genuine can implicate both statutes.
• Forgery (§ 32.21) reaches false writings made to defraud — documents, checks, records — where counterfeiting reaches false marks on goods and services.
• Credit or debit card abuse (§ 32.31) targets the fraudulent use of payment cards, a different instrument entirely, but it lives in the same Chapter 32 fraud family and often appears alongside counterfeiting in swap-meet and storefront cases.

Enhancements & collateral consequences

At the felony grades, a § 32.23 conviction carries the standard felony cascade: loss of firearm rights under Tex. Penal Code § 46.04 and federal law (18 U.S.C. § 922(g)), immigration consequences for non-citizens — a counterfeiting or fraud conviction can be treated as a crime involving moral turpitude — and professional-license exposure. Prior felony convictions can also enhance the punishment range under the habitual-offender provisions of Penal Code §§ 12.42–12.425.

The parallel exposure is federal. Trafficking in counterfeit goods is a separate federal crime under 18 U.S.C. § 2320, and larger operations — interstate shipments, import volume, or high dollar amounts — can draw federal attention on top of, or instead of, a state charge. A person under investigation should assume both sovereigns may be looking and plan accordingly.

What happens after a trademark counterfeiting arrest in Collin, Dallas, Denton, or Tarrant County?

The procedural spine is the same across Texas: arrest or citation, magistration under Article 15.17 where a magistrate sets bond and conditions, then an information in county court for misdemeanor grades or a grand-jury indictment for felony grades, followed by pretrial settings and either resolution or trial. Because these cases are value-driven, the seized inventory and the State’s valuation report are central from the first setting.

Where the case lands depends on the county. Collin County cases — including Frisco arrests — are heard at the Collin County Courthouse (the Russell A. Steindam Courts Building) in McKinney. Dallas County cases run through the Frank Crowley Courts Building, Denton County cases at the Denton County Courts Building, and Tarrant County cases at the Tim Curry Criminal Justice Center in Fort Worth. Our office defends § 32.23 cases in all four from Frisco, and because the grade turns on how the goods were counted and priced, early work on the valuation and the search is often what shapes the outcome.