A recent report prepared by the U.S. Department of Homeland Security (DHS) describes the problem of counterfeit and pirated goods as having “intensified to staggering levels.” Statistics in the report detail a 154% increase in counterfeits traded internationally, rising from a value of $200 billion in 2005 to $509 billion in 2016. Data from DHS shows that between 2000 and 2018, seizures of infringing goods at U.S. borders increased from 3,244 seizures per year to 33,810.
For businesses that offer branded goods, protecting your intellectual property against counterfeiting is an increasing priority. This is especially true where counterfeit goods directly impact consumer safety. An effective, but often under-utilized, method to guard against risks associated with counterfeit goods is to leverage enforcement tools available through U.S. Customs and Border Protection (CBP).
CBP has the authority to detain, seize, and ultimately destroy merchandise seeking entry into the United States that infringes upon trademarks or copyrights that are registered with the U.S. Patent and Trademark Office or the U.S. Copyright Office, and are recorded with CBP through a Customs Recordation.
CBP is an important ally to help protect intellectual property rights, and the process is relatively easy and low cost. CBP’s anti-counterfeiting efforts address all kinds of products, from clothing, to computers, to vehicle parts, and more.
1. Record a Valid U.S. Trademark Registration
A valid U.S. trademark (or copyright) registration is necessary to obtain assistance from CBP. Registration/s must then be recorded with CBP by filing an application through a CBP portal that includes the trademark owner’s name, registration number, and place of manufacture of the goods bearing the trademark. See 19 CFR 133.1 et seq. This article focuses on trademark protection but copyright registrations would be handled similarly under 19 CFR 133.31 et seq. It is important to review your entire portfolio to develop a strategy for recording trademark and copyright registrations.
2. Recording a Trademark with CBP is Easy and Inexpensive
Applications for recordal are submitted electronically via CBP’s online Intellectual Property Rights e-Recordation Application at https://iprr.cbp.gov/. Once a registration is recorded, it is updated in the U.S. Customs database and is available to U.S. Customs officials across the country. Select details of the recordal are also available to the public. You can search recordals online through U.S. Customs Intellectual Property Rights Search at https://iprs.cbp.gov/#/.
The official filing fee is $190 per mark, per international class of goods. The renewal fee is $80 per mark, per class of goods. Recordals are active as long as the underlying registration remains active. Recordals must be renewed when trademark registrations are renewed every ten years.
3. Prepare a Brand Protection Guide
CBP faces a great challenge to recognize counterfeit goods among the high volume of shipments that cross U.S. borders daily. It’s incumbent upon trademark holders to put CBP in the best position possible to readily identify counterfeit goods. Not only does this allow CBP officers to act promptly and effectively, it helps to avoid unwanted delay of genuine product.
IP owners can provide CBP with information about their branding and products, including a comparison of genuine to counterfeit goods and specific counterfeit indicators. A Brand Protection Guide arms front line personnel with product identification information so they can readily assess goods for potential seizure or release. CBP offers a sample training guide here. An electronic Brand Protection Guide should be provided so it can be shared on the CBP database with all border crossing and ports of entry locations.
4. Provide In-Person Training
In-person product identification training can be arranged at CBP field offices. A training seminar at the closest or busiest CBP field office is impactful. In person training will not only enhance your engagement with CBP, but the interactive training, physical documentation, and samples of actual counterfeit and genuine product will allow CBP to better recognize and protect intellectual property from infringement. Training may also be conducted as a webinar for CBP personnel across the country.
The more information and training provided to CBP, the more successful CBP will be in identifying counterfeit versions of product and protecting against counterfeiters.
5. CBP and Counsel Work Together
When goods are suspected to be counterfeit, CBP will detain the shipment for a limited time and notify the trademark owner or their representative based on contact information provided in the recordal. In most cases, CBP will provide photographs of suspect goods, port of entry, and country of origin. They will not yet provide specific details related to the importer, exporter and manufacturer. CBP requests confirmation the goods are counterfeit and if so, the MSRP (Manufacturer Suggested Retail Price). It is important to respond in a timely manner because the goods may only be detained for 30 days from the date first examined by CBP. CBP agents take information provided by the trademark owner into account to make a determination on whether to seize the shipment.
6. Importers are Notified by CBP When Goods are Detained or Seized
Importers are notified when their goods are detained or seized by CBP. This notification puts importers on notice that they have infringed or that their goods are being detained for further consideration of infringement. The notice to the importer sets the stage for potential further enforcement efforts.
7. Request Samples of Seized Counterfeit Goods
Once goods are seized, a notice is sent to the representative of the trademark owner with details that include import date, port of entry, description of goods, contact information for the importer, exporter and manufacturer, country of origin, trademark and trademark registration and recordal numbers. Trademark owners can then request a sample of the seized goods for examination by posting a bond to indemnify the importer.
Examination of sample goods is helpful to determine the source and identify counterfeit indicators. This can inform further enforcement efforts against a bad actor as well as future product branding and packaging that further distinguish authentic product from counterfeit goods.
8. CBP Seizures Support Enforcement Efforts
IP owners should consider if further action is warranted against infringers of CBP seized counterfeit goods. Some factors to consider include size of shipment, identity of the responsible parties, repeat offenders, and potential impact on brand reputation. A trademark owner can bring a civil action and/or notify DHS to support federal criminal action. Certain cases may be more viable for criminal enforcement, such as those with high volume and dollar value, known wrongdoers, and products with critical safety issues.
A trademark owner can also consider enforcement options against foreign exporters and manufacturers.
It’s important to investigate ecommerce websites and brick and mortar locations to support the usual enforcement strategies, like cease and desist letters, notices of infringement to Internet Service Providers, Payment Processors, or online marketplaces, among others.
A trademark owner may also report suspected counterfeit shipments or known infringing parties through CBP’s e-Allegations portal.
9. Audit and Record New Trademark Registrations
It is important to consistently review and update a CBP enforcement strategy. Every new trademark registration should be considered for recordal.
10. We assist with CBP recordal, training, and enforcement
Brooks Kushman is located about 20 minutes from the Ambassador Bridge, a high volume border crossing with CBP offices. For more information on the CBP process, and for assistance to develop a Brand Protection strategy, please contact Amy Leshan (firstname.lastname@example.org) and Robyn Lederman (email@example.com) or call 248.358.4400.