The U.S. Customs and Border Protection Can Help Protect Your Intellectual Property
Many businesses expend significant resources to enforce their intellectual property rights, but it is often difficult to monitor and prevent the importation of infringing products. The U.S. Customs and Border Protection (CBP) provides a relatively inexpensive enforcement tool that aims to protect the intellectual property rights of American businesses at U.S. ports of entry. Companies with valuable trademarks or copyrights should consider utilizing this tool.
In fiscal year 2021, the CBP seized goods with an estimated value of over $3.3 billion MSRP for intellectual property rights violations.[1] The top items seized include counterfeit apparel, footwear, watches, jewelry, handbags, wallets, and consumer electronics.[2] The importation of illegitimate goods can stifle innovation, impede competition, fund criminal activity abroad, threaten national security, and occasionally pose a danger to the health and safety of consumers. Protecting the intellectual property rights of American businesses is a Priority Trade Issue for the CBP, which has implemented several initiatives aimed at targeting counterfeit and pirated goods.
The CBP has the authority to seize goods at ports of entry if they infringe a trademark or copyright that has been registered with the U.S. Patent and Trademark Office (USPTO) or the U.S. Copyright Office and recorded with the CBP.
Trademarks
The owner of a registered trademark can protect against the importation of counterfeit goods and confusing imitations of their mark by recording their trademark registration with the CBP. Recordation requires a valid federal trademark registration that is published on the USPTO’s Principal Register. To apply through the CBP’s e-Recordation program, the trademark owner will need their registration certificate, digital images of the trademark as used in commerce, general contact information, a list of the parties authorized to use the mark (e.g., authorized manufacturers, licensees), and the countries of manufacture. For each trademark registration, the current e-Recordation fee is $190 per International Class of Goods. Recordation remains in effect as long as the underlying USPTO registration is active, provided that the recordation is renewed, at the same time the trademark registration is renewed, every ten years (the renewal fee is currently $80 per class).[3]
The owner of a recorded trademark can create and submit a Product Identification Guide to assist the CBP in determining whether imported goods are authentic or illegitimate. Product Identification Guides are intended to educate CBP officers on the trademark owner’s products, manufacturers, and authorized licensees, as well as any known infringers.[4] The owner may also conduct in-person or virtual trainings to educate CBP officers about their brands, products, and product packaging.
If the CBP encounters items bearing a counterfeit mark, officers will detain the goods. Federal law permits the CBP to examine any shipments imported into the U.S.[5] Inspections may be conducted at random, or they may be triggered by, for example, discrepancies in paperwork, suspicious packaging, or X-ray scan anomalies. The cost, if any, of examination is borne by the importer. The CBP will contact the recorded trademark owner to disclose relevant information related to the seizure, and the CBP may include images or a sample of the detained goods.
If the CBP determines that the mark is indeed counterfeit, officers will seize the goods and, with the consent of the trademark owner, export or destroy the infringing products or obliterate the counterfeit mark and donate or sell the items. Customs Regulations provide that the CBP may impose a civil fine against any person who directs, assists financially or otherwise, or aids and abets the importation of goods bearing a counterfeit trademark. The fine for a first violation will not exceed the value that the goods would have had if they were genuine, according to the MSRP at the time of seizure. The fine for second and subsequent violations will not be more than twice such value.[6]
In addition, trademark owners that record with the CBP are eligible to apply for certain protections against the importation of gray market goods. Gray market goods are genuine products approved of by the trademark owner but not authorized for sale in the U.S. To apply for gray market protection, the trademark owner must contact the Intellectual Property Enforcement Branch of Regulations & Rulings (HQIPRBranch@cbp.dhs.gov).
Copyrights
The owners of registered copyrights—which protect original works of authorship such as writings, films, artwork, sound recordings, and computer programs, among other works—can also record their registrations with the CBP for import protection.
To obtain this extra layer of protection, the owner of a copyrightable work must first ensure that they have an active registration with the U.S. Copyright Office. Registration can be completed online at the Copyright Office website. The applicable fees vary, but the current fee for online registration of one work by a single author that was not made for hire is $45; other online registrations cost $65 or more. The processing time also varies, but the current processing time for online registrations is 2-3 months.[7]
A copyright that has been registered with the Copyright Office may subsequently be recorded with the CBP through the CBP’s e-Recordation Program. (Pending copyright registrations may also be recorded for 6 months if proof of the copyright application is filed with the CBP). Recordation is fairly simple—one must provide their copyright registration certificate, digital images of the copyright as used in commerce, general contact information, and the countries of manufacture (if applicable). The current fee for e-Recordation is $190 per copyright. Recordation of a copyright with the CBP will remain in effect as long as the underlying copyright registration is active, provided that a renewal is filed every 20 years (along with a fee, currently $80).[8]
As explained above with respect to counterfeit items, the CBP does not examine every package imported into the U.S., but it may encounter pirated works during random inspections or inspections triggered by irregularities in related paperwork or packaging. The CBP detains items that officers suspect are infringing copies of recorded copyrighted works. The CBP will notify the importer, allowing them to deny infringement and, if necessary, notify the copyright owner of the detained items. If the claim of infringement is eventually sustained, the CBP will seize, preclude from entry into the U.S., and potentially destroy the pirated items.
Recordation with the CBP is fairly simple, and the benefits can far outweigh the relatively low costs involved. If you have questions about recording your trademarks or copyrights with the CBP, please contact one of the specialists in Koley Jessen’s Intellectual Property Practice Area.
[1] Statistics regarding the CBP’s recent seizures and enforcement of intellectual property rights can be found in the FY 2021 Intellectual Property Rights Seizure Statistics book (https://www.cbp.gov/document/annual-report/fy-2021-ipr-seizure-statistics).
[2] U.S. Customs and Border Protection, “The Truth Behind Counterfeits,” https://www.cbp.gov/trade/fakegoodsrealdangers.
[3] See 19 C.F.R. §§ 133.1–133.7; https://iprr.cbp.gov/s/.
[4] For a Product ID Training Guide template, see https://www.cbp.gov/sites/default/files/assets/documents/2018-Jul/IPR%20Product%20ID%20Training%20Guide_Website_0.pdf.
[5] 19 U.S.C. § 1467.
[6] 19 C.F.R. § 133.27.
[7] To view the current registration processing times, go to https://www.copyright.gov/registration/.
[8] See 19 C.F.R. §§ 133.31–133.37; https://iprr.cbp.gov/s/.
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