Intellectual Property Rights & Wrongs: CBP Counterfeit Seizures
by Peter Quinter, guest columnist
Customs and Border Protection (CBP) just issued its 2013 annual report on seizures of counterfeit merchandise that attempted to enter the US illegally. The statistics on CBP counterfeit seizures continue to climb year after year in both the number of seizures (up 7% from 2012) and the value of the seized merchandise (up 38%). Based on the estimated value of the seizures, handbags and wallets remain the perennial favorite counterfeit, while watches and jewelry have surged into second place. For the first year since 2005, footwear seizures do not make the top 5. If, on the other hand, you guessed that China once again ranked first as the country of origin for the most counterfeits, you guessed correctly.
Every day, counterfeit merchandise of all kinds – whether it be handbags, jewelry, clothing, electronics, or medicines – is intercepted by CBP officers at the air, ocean, and land borders. As I’ve written before (see Are Those Red Bottoms Really Christian Louboutins?), CBP officers have the legal authority to stop, examine, and seize suspected counterfeit merchandise. That is why companies as diverse as Rolex, Gucci, Apple, Ford, and Disney not only register their trademarks with the US Patent and Trademark Office, but also take the additional step of recording those trademarks with CBP. Both trademarks and copyrights are recorded through the Intellectual Property Rights e-Recordation online system, which allows CBP to obtain information instantly, facilitating the seizure of fake goods.
The flip-side of this enforcement effort is that, still too often, CBP officers seize merchandise that is suspected of being counterfeit or otherwise infringing a trademark or copyright, but really does not. The concept of gray-market, genuine merchandise still seems to be a challenging one for CBP to grasp.
Of course, owners of merchandise wrongly seized by CBP may attempt to get their merchandise released through the administrative petition process with the CBP Fines, Penalties, and Forfeitures Offices.
However, the current administrative petition process described at 19 CFR Part 171 takes far too long to resolve, especially when the value exceeds $100,000, and the case must be referred from the ports to CBP headquarters in Washington, D.C. By the time CBP has realized and agreed that the merchandise is not counterfeit, and has released it back to the importer, it could be a year later. The merchandise no longer has the same value, and the contract for the resale of the merchandise has likely been cancelled, so the importer who (presumably) tried to do everything right, suffers the loss. These situations do not show up in the annual CBP statistics, but they are the unfortunate reality for many.
If you have questions about protecting your IPR or recovering seized merchandise, please post your comments below or contact me directly at [email protected] or (954) 270-1864.
Copyright © 2014 GrayRobinson
This column is based on material that originally appeared in the GrayRobinson Customs and International Law Blog, which is edited by Peter Quinter and covers a range of legal and regulatory issues related to trade. Subscribe at http://www.grcustomslaw.com/
About Peter Quinter
The Datamyne Blog’s legal contributor is a shareholder in GrayRobinson’s Miami and Ft. Lauderdale offices, and chair of the firm’s Customs & International Trade Law Group. Appointed by the Secretary of Commerce to the Florida District Export Council, Quinter is a recognized expert in international and trade law, and has been listed in “Best Lawyers in America” in the area of FDA Law each year since 2009. Learn more about GrayRobinson here; learn more about Peter Quinter here.
The opinions expressed in this article are those of its author and do not purport to reflect the opinions or views or Descartes Datamyne. In addition, this article is for general information purposes only and it’s not intended to provide legal advice or opinions of any kind and my not be used for professional or commercial purposes. No one should act, or refrain from acting, based solely on this article without first seeking appropriate legal or other professional advice.
Date posted: April 21, 2014