Last year, on a typical day the U.S. Customs and Border Protections (CBP) seized about $3.8 million worth of products because of Intellectual Property Rights (IPR) Violations. CBP reported that the total number of IPR seizures has increased nine (9) percent since last year, from 28,865 in 2015 to 31,560 in 2016. With the manufacturer’s suggested retail price (MSRP) exceeding $1.3 trillion.
What is Causing the Increase in Seizures?
Recordation of Trademark And Copyright With The CBP
In addition to registration of IPR with the U.S. Patent and Trademark Office (USPTO for trademarks), or the U.S. Copyright Office (for copyrights), owners can record said trademark or copyright with CBP. This additional step grants CBP additional enforcement power in both seizing counterfeit and piratical goods as well as thereafter issuing penalties for the MSRP value of the goods. In previous blog posts, we explained benefits of taking the extra step of recording your registered trademark or copyright with CBP, and CBP’s additional enforcement powers as a result of the recordations.
- Products that infringe U.S. trademarks and copyrights threaten the health and safety of American consumers and pose risks to our economy and our national security. CBP takes IPR violations very serious, and in 2016, Immigration and Customs Enforcement (ICE) and Homeland Security Investigations (HSI) workforce, made 451 arrests, “obtained 304 indictments, and received 272 convictions related to intellectual property crimes.”
More Than the Product
- IPR violations are not limited to the product itself, if any component of the product violates existing IPR then the whole product will be seized. A seizure of over 200 hoverboards at PortMiami was highlighted in this Miami Herald article. In this case, the LG batteries were allegedly counterfeit. For more on hoverboards read our previous article. If your goods are seized, contact Diaz Trade Law to learn how we can assist you, as we have successfully helped numerous clients with CBP seizure cases.
How to Avoid Becoming a Statistic?
Know your product!
- Awareness of how your product is made, and what it consists of, is very important in avoiding violations. However, if you have a more complicated supply chain and don’t purchase goods directly from the manufacturer. Often times, you may not know who made what portion of the merchandise. This is very troublesome, especially if your products come from the China region. In 2016, almost 88 percent of all the seizures made by CBP for IPR violations were from China and Hong Kong.
- Pre-compliance is an excellent opportunity to mitigate and avoid any errors before your products get CBP attention. For more on pre-compliance you can visit this article, or check I WANT TO ENSURE I DON’T HAVE A PROBLEM BEFORE I START IMPORTING, CAN YOU HELP ME?on our official YouTube page.
Dealing with a Seizure Case?
If your goods are seized, you will have to deal with a complicated seizure process (discussed more here). The link has a picture of the process – doesn’t it look intense? That’s because it is. You need an expert that understands it and will fight for you correctly. Depending on the case and your specific facts your attorney may recommend filing a Petition or a claim and cost bond. Filing a Petition gives you a few bites of the apple (if you lose, you can file a Supplemental Petition, and thereafter, still file a claim and cost bond). Every case is different and must be evaluated on its own merit.
At Diaz Trade Law you can find TOP 10 TIPS WHEN IMPORTING cheat sheet you can download for FREE. The Top 10 Tips discusses the importance of IPR compliance, and knowing who you are doing business with, as well as additional Customs requirements importers must be aware of. Diaz Trade Law can assist if you are dealing with a seizure by CBP – or if you want to avoid them with a robust pre-compliance program. Contact at email@example.com.