Sep 28, 2015

CBP: Final Rule Regarding Disclosure of Information for Certain Intellectual Property Rights Enforced at the Border

On September 18, 2015, US Customs and Border Protection published a final rule regarding the disclosure of information about goods suspected to bear counterfeit trademarks or trade names. This rule finalizes an interim rule issued April 24, 2012 and is an amendment to the Code of Federal Regulations(19 CFR parts 133 and 151). In order to provide businesses the opportunity to make adjustments to their practices, the CBP has set the effective date for the final rule at 30 days from the date of publication in the Federal Register. Therefore, it will be in effect as of October 19, 2015. The changes allow CBP to share more information about goods suspected to be counterfeit with trademark owners in order to establish whether or not they are, indeed, counterfeit. This includes information that, without this amendment, would be protected by the Trade Secrets Act.

The key points of the final ruling are as follows: CBP may, when faced with goods that are being imported into the United States and are suspected to contain counterfeit marks, detain these goods for up to 30 days. Within five business days from the date of the decision to detain the goods, CBP must notify the importer of this decision. After notification, the importer will have a seven business day response period to provide CBP with the information required to determine that the goods do not contain any counterfeit marks. During this seven day period, CBP is allowed to share the following information regarding the goods with the trademark owner: the date of importation, the port of entry, the description of the merchandise, the quantity of the goods. Furthermore, CBP is allowed to present the trademark owner photographs, images or a sample of the suspect merchandise, provided that any information that could reveal the name or address of the manufacturer, exporter or importer is removed.

The importer’s failure to provide CBP with information that is sufficient to conclude that the goods do not contain any counterfeit marks, before the end of the seven day period, allows CBP to share information with the trademark holder that is otherwise protected by the Trade Secrets Act. That includes, but is not limited to, serial numbers, dates of manufacture, lot codes, batch numbers and universal product codes. In this case, the identity of the manufacturer, exporter of importer may be revealed.

Whenever CBP shares information with the trade mark owner, it is obliged to inform the trademark owner that some or all of the information may be subject to the protection of the Trade Secrets Act and that CBP is disclosing the information for the sole purpose of determining whether or not the detained goods contain counterfeit marks. Whenever CBP shares a sample of the detained goods with the trademark owner, the owner is required to post a bond, in the form and amount specified by CBP, in order to protect the importer against damage to, or loss of the sample.

The regulations outlined above should be a significant improvement in CBP’s ability to determine whether or not goods contain counterfeit marks and, thereby, in the protection for trademark owners.   

If you have any questions about the issues discussed in this alert, please contact Jim Bikoff, Partner and Head of the International Trademark Practice Group at Smith, Gambrell & Russell, LLP.

This legal alert is intended to inform clients and other interested parties about legal matters of current interest and is not intended as legal advice. 

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