What about "Willful Blindness"?
“[t]o be willfully blind, a person must suspect wrongdoing and deliberately and failed to investigate"
"[W]here indeed it may be enough that the defendant should have known of the direct
infringement, as it is in the law generally.... One who, knowingly, or strongly suspecting that he is involved in shady dealings, take steps to make sure that he does not acquire full or exact knowledge of the nature and extent of those dealings is held to have a criminal intent, because a deliberate effort to avoid guilty knowledge is all that the law requires to establish a guilty state of mind."
WildWest,
This a good point.
Though 'willful blindness' is not something written into copyright law, it is a thing. It has been established by federal court decisions, not just in copyright infringement cases, but in trademark infringement cases as well.
Willful Blindness
Here is an example involving trademark:
A small shop owner buys handbags from an itinerant operating out of the back of a van. The bags have the Gucci logo on them. The bags are cheap enough that the shop owner can sell them for 37.50 apiece and make a nice profit. Is this 'willful blindness' on the part of the shop owner?
Anybody who has been in the bag and baggage business for any length of time knows the name Gucci. It's world famous. It's common knowledge that the bags are not cheap. If the shop owner sees that these bags are of poor workmanship and they have purple vinyl linings, he should suspect they are counterfeit. He should be held liable for penalties even though he may claim he did not know they were not genuine. He could have at least asked the traveling peddler if the bags were genuine. And how much effort would it take to make a couple of phone calls to investigate beyond that (for example, calling a Gucci distributor to ask about the purple linings). And does it make sense that Gucci would be distributing through traveling peddlers?
The standard penalty for this kind of infringement is the equal of triple the profits from the sale of the goods plus attorney fees and court costs. A judge may decide to impose more.
.............
How do you know it it's pirated?
When it comes to artwork, sometimes it's easy to find out if it has been pirated. If it still has the watermark on it, for example. This is a red flag. If a customer has actually licensed a photo or piece of clipart, they should be able to give you a high rez bitmap or a clean vector.
If there is no obvious watermark, I like to simply ask where they got the image. Sometimes I ask what the cost was. Many say they got it off the internet, in which case it's probably junk anyway. I offer to buy them an image that I know will be good quality and that I won't have to fight with to make it useful. I tell them that sometimes it costs more to fix an unacceptable image than it does to just buy a clean one.
I generally don't insinuate to a client that they are dishonest and I avoid insulting them. It's not my style anyway.
If they give me a file that does not have any signs of being pirated (maybe they give me two or three file formats, which is a good sign), I simply use it. This is regarding clipart or photographs, both of which are protected by copyright law.
A logo is not in the same category as clipart or a photo. Generally, most simple logos do not qualify for copyright protection. Some elaborate logos do. But I've been doing signs since 1974 and I don't recall ever using a logo that had copyright protection. Maybe I did and didn't realize it. I know specifically of three logos where the companies applied to the US Copyright Office for copyright registration for the logos and were denied (Geek Squad, Subway Sandwiches and Best Western Motels).
But if a logo represents a product or service, it is certainly protected by trademark.
If a business brings me their logo to put on their sign, I don't question it. If they are a franchise outlet of a national chain, I still don't question it, though I will often ask for branding guidelines and offer to call their home office for them to get the guidelines to save them the legwork. This is a practical step, as it heads off the problem of using a trademark incorrectly.
I assume that a person that is affiliated with a company has authority to order a sign with the company logo on it.
What if the sign client is not really affiliated with the logo owner? An event organizer wanting a banner with all the logos of the sponsors, for example? I just do it. The organizer usually provides me the logos even if some are crappy. In 40 years I have yet had this turn into a problem.
Sometimes, though rarely, a retailer has not been permitted to use a logo of one of their suppliers on sign work. A hardware store, for example, not being allowed to use a DeWalt logo on their wall. Or a siding company not allowed to use the Alcoa logo in any of their advertising. In rare instances, I have seen a manufacturer instruct a retailer to remove a logo from the retailer's sign, even though the retailer was a seller of the manufacturer's products.
More often, I have seen clients get in trouble for not using logos correctly (placing them too close to other logos, using incorrect proportions or colors, etc).
What if some guy off the street wants a Harley logo on their garage at home. It is surely a trademark infringement. What if my doctor wants OP to paint the Tazmanian Devil cartoon character on the transom of his Bayliner. This is no doubt a copyright infringement, though I've never seen anybody busted for it.
These things are pretty obvious.
Our company's experience with trademark infringement
In the ten years I have worked for my current company, we have been "involved" in trademark infringement three times. In each case, the logo that the client brought to us turned out to be an infringement of an existing trademark. In all three cases, we were never contacted by the trademark owners or their lawyers. No one was sued. Cease-and-desist letters were sent to the sign clients and they had to get new signs. We made the new signs for all the clients. In all three instances, it was obvious that the trademark owners were not trying to punish anybody. They were just protecting their trademarks. Their goal was to stop the infringement.
I know one case where ReMax Real Estate sued another realty company for using signs that looked like ReMax signs. It went to court and the infringement was found to be intentional. A document turned up that was a sign shop work order with the client's instructions to use Remax red and Remax blue on the signs. The sign shop did not get in trouble, but ReMax won the case against the other realtor. ReMax is known to be aggressive in defending their trademarks.