A Recordal, a Notice, an Investigation, and a Raid

By Robert Feinland

I rounded the corner and saw my destination ahead. As I parked my car and walked towards my destination, the sounds of barking dogs and the shuffling of feet became louder. The garage door slowly opened. Dead leaves were scattered on the bottom of the garage door. All of a sudden, in the corner of my eye I saw law enforcement officers (federal, state and local) approaching me. Then the front door of the house swung open and a person in handcuffs walked out and was immediately placed in a police car. Swarms of officers stormed the house. I turned back towards the garage and saw countless storage containers, boxes, and shelves filled with counterfeit products that imitated the products of well-known fashion companies. As I walked through the garage, there were stacks of counterfeit bags in all sizes of various companies. I analyzed a number of the counterfeits of our client’s product to confirm that these products were actually counterfeit.  Inside the house, there were even more counterfeit products. Officers walked through the house and found multiple computers and boxes filled with papers that housed the accused’s sales records and purchase orders. A truck pulled into the driveway, andthe team of law enforcement then packed up the counterfeit products into the truck and left the house hours after the raid began. We later found out that the accused made millions of dollars selling counterfeit products, manufactured in China, all across the U.S.

The raid was the result of three years of work, which began inauspiciously with the receipt of a letter from U.S. Customs and Border Protection (CBP) informing us of two seizures of counterfeit labels bearing our client’s federally registered trademarks. Based on the large number of products seized, we forwarded the information to the prosecutor’s office closest to the importer’s address in order to investigate the matter further. The investigation ultimately led to a raid at the importer’s house.

CBP is responsible for enforcing intellectual property rights, such as copyrights, trademarks, and trade names at the border. This article will provide an overview of CBP’s role in trademark protection/enforcement and how trademark owners can record their trademark registrations with CBP. As a quick reminder, a trademark is any word, name, phrase, symbol, design, or other device, alone or in combination, used to identify the source or origin of goods or services.

CBP is a branch of the Department of Homeland Security and is the primary federal agency responsible for securing the U.S. border. In accordance with U.S. trademark and customs laws, CBP has the authority to determine trademark infringement at the U.S. border and its officers have the right to refuse entry, detain, and seize items that infringe upon federally registered trademark rights as long as the trademark is recorded with CBP.[1] CBP works alongside other federal agencies including the United States Patent and Trademark Office (“USPTO”). However, CBP relies most importantly on the assistance from trademark owners in order to enforce one’s trademark rights.

CBP prevents the importation of goods bearing infringing marks. CBP has the authority to enforce different types of trademark infringements including counterfeit marks. A counterfeit mark is a “spurious mark that is identical with, or substantially distinguishable from” a federally registered trademark.[2] A person who intentionally traffics in counterfeit goods may be subject to criminal penalties including fines. Further, CBP has the power to impose a civil fine against any person who directs, assist financially, or aids in the importation of goods bearing a counterfeit mark.[3] Criminal remedies can be prosecuted by the U.S. Attorney or by the state/local prosecutor’s office. In order to prosecute the criminal action, a prosecutor may seek assistance from a trademark owner in the investigation, may ask the trademark owner to act as a witness, and/or file a declaration along with a victim statement where the trademark owner may seek restitution.

In order to reap the benefits of CBP’s assistance in enforcing one’s trademark rights a trademark owner has to record its federally registered trademark(s) with CBP. The only trademarks that are eligible for CBP protection are those registered on the USPTO’s Principal Register. Common law trademarks and marks registered on the Supplemental Register are ineligible for recordation with CBP. Some benefits of recording a trademark with the CBP include greater awareness of one’s mark by the custom officers and CBP focusing its enforcement efforts on recorded marks. In addition, trademark owners and their representatives are entitled to information from CBP in connection with the detention and seizure of goods bearing the infringing marks including, but not limited to importer’s contact information, exporter’s contact information, description of merchandise, quantity of goods seized, and country of origin. A trademark owner may obtain a sample of the suspected goods from CBP by posting a bond for CBP to release the sample.

The easiest and most efficient way to file applications to record a trademark registration with CBP is through its Intellectual Property Rights e-Recordation system. Through this system, an applicant can upload images of the registered mark, pay the fee (currently $190) immediately by credit card, and it reduces the time for filing and processing the application. When preparing the application to record a trademark registration with CBP, a trademark owner will need to provide the following information:

  • Details on the trademark registration (registration number and International Class of goods covered by the registration);
  • Trademark owners; name, business address, and citizenship;
  • Trademark owner’s representative’s information;
  • Countries of manufacture of goods bearing the genuine mark;
  • Names and addresses of all parties authorized to apply the trademark and the nature of the relationship to the owner (e.g., licensee, subsidiary, manufacturer, etc.);
  • Names and addresses of all persons or business entities (foreign or domestic), who are authorized to use the trademark; and
  • Names of any parent companies, subsidiaries, or other entities, foreign or domestic, that are under common control with, or share any type of ownership interest or relationship with the U.S. trademark owner.

Any approved trademark is then recorded and stored in CBP’s Intellectual Property Rights Search database. This database is available to the public to find information on recorded trademarks. A recordal with CBP will remain in effect simultaneously with the trademark registration and must be renewed when the trademark registration is renewed.

A trademark owner can expand the protection of its trademark rights through the cost-effective method of recording its trademark registration with CBP.  Owners of federally registered trademark that have concerns with counterfeit products being imported into the country absolutely should record their trademark registrations with CBP. As detailed above, the recordation of one’s trademark registration with CBP can result in the finding of an importer trafficking large amounts of counterfeit products having the intent to sell these products and dilute the United States marketplace.

[1] See 15 U.S.C. §§ 1124 and 1125; see also 19 U.S.C. §§ 1526 (a), (b), (e), and (f); 19 U.S.C. §§ 1595a(b) and (c)(2)(C).

[2] See 15 U.S.C. § 1127.

[3] See 19 U.S.C. § 1595a(b).