How often do you think U.S. Customs and Border Protection (CBP) officials have heard an importer say, “. . . but I didn’t tell the manufacturer to put that trademark on there”? Ignorance may be bliss, but CBP will not accept that excuse as an acceptable reason to allow counterfeit merchandise to enter into the United States, or even allow it to move in-transit through the United States. This, however, is the often heard explanation when an importer does not do its due diligence.
There are a few steps every importer should take prior to doing business with a new manufacturer or importing into the United States a new product.
A reputable manufacturer should, and ultimately will, provide a sample. Inspect the sample thoroughly. If it is an electronic item, you may want to go as far as taking it apart to make sure that the inner workings do not contain any trademarks or logos or copyrights which either you did not request or the manufacturer is not licensed to produce. If your sample is different than the merchandise shipped, then you can at least say to CBP, “This is not what I ordered. I have a sample of what I was supposed to receive,” and the correspondence with the manufacturer to support your claim. Even if you do not get your merchandise back from CBP, it is important to understand that you may use your due diligence as a mitigating factor if and when you are fined by CBP. Fines are routinely issued by CBP pursuant to 19 U.S.C. 1526(e) and equal the Manufactured Suggested Retail Price (MSRP). Companies which or persons who get such fines may get them reduced by filing a Petition. Knowing the factors that CBP considers when reviewing the Petition is critical.
Licensing agreements (on paper) can be falsely produced by anyone with a computer and printer. Just because a manufacturer shows you what appears to be a license while attending a reputable tradeshow, does not mean it’s valid.
Just keep the following in mind. Ask for a copy of the licensing agreement, and don’t take a manufacturer’s word that they have a license, verify. Obtain references or work with reputable manufacturers. Don’t think that you’re just getting a great deal, because if it’s too good to be true, then it probably is! Many trademark and copyright owners maintain websites which list the approved companies authorized to manufacture products with the protected trademarks or copyrights.
And lastly, don’t think that you won’t get caught. Remember, it’s CBP’s job is to protect both you and the economy. Counterfeits are not limited to cheap handbags at the flea market, but auto parts and aircraft parts, and many more items that you would not want to be substituted (think medicines).
If a hold, detention, or worse yet, a seizure by CBP occurs at any port in the United States, an importer should promptly contact a customs attorney to file a Petition to attempt to persuade CBP to release the seized merchandise. Common trademark and copyright counterfeiting is for Bluetooth, Microsoft, Intel, Apple, Underwriter’s Laboratories (UL), and Tetris. Petitions should contain specific information and attach certain types of documentation to convince CBP that it made an error in the initial seizure. The Customs and International Trade Department attorneys of Becker & Poliakoff are very knowledgeable and experienced in these matters, and may assist companies with the process.