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IACC Files Submission to Office Of US IP Coordinator
The International AntiCounterfeiting Coaltion filed its response to the request yesterday. Among the statements made by the IACC is a request seeking improvements in the manner in which the Customs Service, known as the US Customs and Border Protection, imparts information to IP owners. The IACC submission said in part:
“At present, the single greatest policy priority for the IACC and its members concerns the availability of information regarding shipments of goods detained by US Customs and Border Protection (“CBP”) which are suspected of being counterfeit, or otherwise violating the rights of intellectual property owners in trademarks registered in the United States and recorded with CBP.
As the manufacturing capabilities of counterfeiters have increased in recent years, with the more widespread availability of tools which facilitate the replication of products and packaging, Customs’ ability to detect counterfeit goods has grown exponentially more difficult. Rights-holders have adopted a variety of technologies, both overt and covert, which are commonly used to aid in identifying illicit product or verifying the legitimacy of goods. The volume, and variety, of goods entering the domestic stream of commerce at US ports obviously makes it unfeasible for Customs personnel to receive the extensive training or level of familiarity necessary to verify the legitimacy of every trademark that comes before them. Traditionally, private sector rights-holders have been consulted by CBP, and have offered assistance in making such verifications. Regrettably, CBP has adopted a policy – citing the Trade Secrets Act – which has significantly reduced the ability of CBP to ask for, or for rights-holders to provide, such assistance.
By way of example, many legitimate manufacturers and rights-holders have adopted verification procedures which involve the marking of product containers and packaging with unique serial identification markings at the time of manufacture. Current CBP policy precludes the disclosure of such markings to a rights-holder either through the provision of samples or photographic evidence. In practice, CBP has provided redacted photographs or digital images of the goods; or when physical samples have been provided, Customs personnel have physically removing or obliterated the markings prior to providing the sample to the rights-holder. Unfortunately, absent those identifying codes, in many cases, the trademark owner has been unable to make a positive determination regarding the products’ authenticity. The implication of the Trade Secrets Act (and the potential for criminal prosecution for violations of that statute), has, according to reports from IACC member companies, resulted in Customs’ reluctance to share information which might allow rights-holders to provide the type of assistance necessary to verify whether a suspected shipment is, in fact, counterfeit. The clear result of this policy is an increased likelihood that greater volumes of counterfeit product will enter through the borders, posing greater threats to consumers, and greater economic harm to legitimate businesses.
Information is arguably the most powerful weapon available to law enforcement and rights-holders in addressing the problem of counterfeiting. IACC members continue to report however that current policies in place are hindering their ability to identify individuals involved in the trafficking of counterfeit goods. Rights-holders noted that they frequently encounter cases of fraud when conducting follow-up investigations, subsequent to their receipt of Customs Seizure Notices from the Office of Fines, Penalties, and Forfeiture. In some cases, the individual named as the importer of record has been the victim of identity theft (and is in no way connected to the importation); while in other cases, a fictitious name has been provided by the importer to a customs broker, and in turn, to CBP.
Customs and Border Protection has the authority to regulate customs brokers, and to conduct audits of customs brokers’ records. Even a relatively minor step such as a due diligence requirement similar to that set forth in other areas of federal law (e.g., the Bank Secrecy Act, 31 USC 5318), or a requirement that customs brokers require an importer to provide two valid forms of government identification (and copies of corporate papers, in the case of a business), would help to deter such fraud. The ability to accurately identify and locate importers could also be useful in the enforcement of fines assessed against importers for violations (whether related to the importation of counterfeit products or other provisions of the Customs laws).
The PRO-IP Act was grounded in the idea that improving IP enforcement required improving the communication and coordination among all of those tasked with the job. That idea applies equally within the government, in the private sector, and between the two. To that end, the IACC supports a comprehensive review of these and other Executive Branch policies to ensure that open communication and cooperation between rights-holders and government personnel tasked with enforcement is not unduly burdened.”
More information can be found out about the IACC at http://www.iacc.org.
National Trademark Investigators Launch New Website – Fake Finder
Consumers and brand owners stand to benefit from isitfake.org, a new website launched by California private investigation firm National Trademark Investigations (NTI) to facilitate the identification and reporting of counterfeit goods. Isitfake.org makes it possible for consumers to submit suspected knock-offs for evaluation. Each “fake finder” report is evaluated to make a determination, working with brand owners whenever possible, as to the authenticity of the item reported. Confirmed counterfeits or “fakes” are posted to the site’s gallery, becoming a searchable resource for other consumers.
According to the Global Intellectual Property Center of the U.S. Department of Commerce, intellectual property theft costs U.S. businesses between $200 billion and $250 billion each year and the loss of 750,000 jobs, and poses risks to public health and safety through exposure to and use of counterfeit products.
“Isitfake.org has been created to help combat the problem of counterfeiting in three ways,” explained Mike Santoni, president of NTI, which initiated the isitfake.org project. “First, consumers can reach out for help determining whether an item they have purchased is legitimate branded merchandise, or a knock-off. Secondly, each time isitfake.org is able to conclusively identify and report on a counterfeit, it adds to the searchable gallery on the site as a resource for the public. And finally, it provides brand owners with a new source of information about knock-offs that they can use in their anti-counterfeiting efforts.”
Reports of counterfeit items can be submitted through isitfake.org anonymously. “We thought it was important that consumers be able to use the site without having to identify themselves, so there’s no reason not to submit a question or report through the site,” explained Scott Rutherford, director of marketing for NTI. “Our objective is to develop intelligence about knock-offs and how they are distributed and sold, which will help consumers better inform themselves and help brand owners protect the integrity of their brands, products and reputations.”
The site is located at http://www.isitfake.org.
Brazilian government proposes to “ignore” US patents and copyrights in trade dispute.
The Brazilian government has announced its intention to cross-retaliate against the US by “ignoring” certain patents and copyrights belonging to US citizens as part of a trade war between the two countries over cotton.
This is the second set of measures Brazil has unveiled in a week to pressure Washington to obey a ruling by the World Trade Organization that found the U.S. cotton subsidies and export credit guarantee program illegal.
Diplomats, trade experts and business leaders are closely watching the case, one of a few in which the WTO has allowed cross-retaliation, in which the wronged party can retaliate against a sector not involved in the dispute.
Brazil would become the first country ever to apply cross retaliation under WTO rules.
The new measures, which are still subject to public hearings, would suspend for a limited time U.S. patents on pharmaceuticals, chemicals and biotechnology.
They would allow Brazil to restrict copyrights in the music and audiovisual industry. The measures listed in an official publication would also allow the government to increase fees and tighten regulations on registration of intellectual property rights.
International Intellectual Property Alliance (IIPA) Files 301 Report
A short while ago I reported that the International AntiCounterfeiting Coalition (the “IACC”) filed a 301 report with the Office of the United States Trade Representative (the “USTR”).
Now, I want to report on the filing with the USTR done by the International Intellectual Property Alliance (the “IIPA)(Don’t you wish sometimes that these organizations came up with better names for themselves).
The IIPA is based in Washington, DC and has been around for many years. It is a kind of association of associations, representing the IP interests of the various copyright organizations in the US . Early this month, the IIPA President, Eric Smith, testified before the USTR and summarized the IIPA positions as follows:
“This year, we ask the U.S. government to pay heightened attention to countries
where enforcement is inadequate and non-deterrent. We should ask our trading partners to:
• Undertake more criminal actions against piracy of software in the corporate
environment; against growing online and mobile device piracy of music, motion
pictures, software, video games and books and journals; against continuing
piracy of optical disc products and the unauthorized printing and commercial
photocopying of books and journals; and, against the manufacturing and
trafficking in circumvention devices.
• Dedicate sufficient enforcement resources, and train and empower enforcement
authorities, in a manner commensurate with the scale of the problem.
• Remove onerous and unnecessary procedural barriers to the judiciary acting in
civil and criminal cases.
• Impose deterrent penalties in criminal cases and adequate (and deterrent)
damages and remedies in civil cases.
The U.S. government should also ask our trading partners to:
• Encourage cooperation of ISPs with all content owners, including workable and
fair notice and takedown systems and graduated response mechanisms to deal
with repeat infringers online.
• Direct government agencies, contractors and educational institutions to use only
legal software and legal copies of textbooks, and to ensure that their networks
or computers are not used for infringement of any copyrighted content.
• Enact and enforce laws against camcording motion pictures.
• Implement the obligations in the WIPO Internet treaties and to ratify those
treaties, if they have not yet already done so.
• Dismantle market access barriers and refrain from establishing market access
conditions based on the nationality of the IP owner.”
The USTR’s Report based upon the filings of interested parties like the IACC and the IIPA will be out later this Spring. I hope that the US government will adopt the recommendations filed by the IACC and the IIPA.
Brazil to retaliate against US in trade war – may go after US IP
The Government of Brazil moved on Monday to raise tariffs on a wide range of American goods, potentially igniting a trade war with the US over cotton subsidies after eight years of litigation at the World Trade Organisation.
The decision takes effect next month, starting a 30-day period during which US and Brazilian officials will attempt to negotiate a solution to the dispute.
Under the Brazilian plan, duties would rise most steeply on cotton products. Many that are currently taxed at between 6 per cent and 35 per cent would be taxed at 100 per cent. The tariffs on beauty products would double, from 18 per cent to 36 per cent. Duties on household goods such as cookers, refrigerators, TVs and video cameras would also double, from 20 per cent to 40 per cent. Duties on cars would rise from 35 per cent to 50 per cent.
Brazil is allowed to impose the tariff increases – worth $560m – after winning a case at the WTO last year. Brazil challenged the legality of direct subsidies to US cotton farmers to protect them against fluctuations in global prices and a loan guarantee programme for international buyers of US cotton.
Brazil could also impose further penalties – known as “cross-retaliation” – on US intellectual property rights, potentially breaking patents in the pharmaceuticals, technology and media industries. It is unclear at the moment how the Brazilians will attack US IP. More information will be posted on IPTango.com.
eBay team helps put counterfeit gang away
The leader of a UK-based gang who made millions selling counterfeit luxury golf kit and other knock-off goods through auction site eBay has been jailed for four years.
Gary Bellchambers and six others ran what is reckoned to be the biggest ever such scam between June 2003 and March 2008. Their fraud was eventually rumbled by a trading standards team at Havering Council, who were put on the trail of the fraudsters by pensioner Christine Manz.
The council team worked with eBay to identify 96,000 bogus transactions including golf clubs, clothing and forged Qantas business class lounge pass cards. The crooks supplied cheap knock-off imitations in place of the promised premium quality kit from US manufacturer Callaway Golf.
Bellchambers, 45, of Rainham, who admitted masterminding the scheme, pleaded guilty to fraud along with co-conspirators Keith Thomas, 49, from Rainham, and Chris Moughton, 56, from Blackpool. Four other suspects in the case were found guilty in a trial last December.
Roy Cottee, 65, and his wife Kay, of Rainham, Essex; Helen Wilson, 28, of Hertford, and Sharron Williams, 48, of West Wickham, Kent joined their three accomplices in the dock for a sentencing hearing at Snaresbrook Crown Court in London on Thursday.
Ringleader Bellchambers was jailed for four years and three months, with a recommendation to spend at least half that time behind bars. Thomas, the scam’s second in command, was sentenced to 16 months in jail, with an order to serve half in custody.
Roy and Kay Cottee were also convicted of conspiracy to distribute Qantas business class lounge cards. Roy Cottee was jailed for 12 months while his wife was handed down a 300 hour community service order.
The other three members of the conspiracy received a combination of suspended sentence and community service orders.
In a statement, eBay UK welcomed the sentences and explained the modus operandi of the crooks. “Bellchambers and his gang of felons used an international network of criminals to open and maintain eBay accounts using a variety of false documentation, bank, credit card and contact details.
“The case which secured today’s convictions was supported by eBay’s Fraud Investigation Team and reinforces eBay’s ongoing commitment to fighting counterfeits.”
eBay’s Fraud Investigation Team worked with Havering Trading Standards for over three years to make sure Bellchambers and his accomplices were brought to justice. Investigators supplied information from suspect eBay and PayPal accounts to their Trading Standards counterparts as well as testifying in court.
Last year eBay trained 1,666 coppers in the UK, and in the last two years has assisted officers in over 9,000 case investigations, resulting in the arrest of 200 suspected criminals.
The Centrist 
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