Stopping trademark infringers at the border with the help of the U.S. Customs and Border Protection
At Rockridge®, we often draw on everyday life lessons to explain and simplify branding law and intellectual property protection. For instance, you can think of the U.S. Patent and Trademark Office’s (USPTO) role of conferring patent or trademark registration as that of a backyard surveyor. The USPTO might tell you where your property boundaries are, but it’s your job to build the fence and keep intruders out (of your IP, in this case). One exception to this rule: recording your registered trademark with the U.S. Customs and Border Protection (CBP).
If you hold a federally registered trademark with the USPTO, U.S. CBP can go to work for you monitoring against knockoff or otherwise infringing imports. CBP allocates resources to prevent infringing products from entering the U.S. market because importation of infringing goods threatens the U.S. economy, fair market competition, and even health and safety of consumers. They actually invite you to help them protect your IP rights.
What does CBP do to Enforce Trademark Rights?
CBP processed a staggering 213 million express shipments and 94 million international mail shipments in fiscal year 2021. Despite the sheer volume of shipments, CBP aims to prevent infringing products from entering U.S. markets by meaningfully inspecting products entering the country and seizing those that infringe on the rights of intellectual property holders that have recorded their IP with CBP. The agency has created a comprehensive program to partner with you as an IP rights holder to prevent infringing products from reaching the U.S. market.
How are Trademarks Recorded with CBP?
In order for border agents to go spy mode for you, they first have to know what to look for.
First Step: RECORD. To record, you must (1) own a federally registered trademark for use on goods registered on the Principal Register. Then, (2) apply for recordation using CBP’s IP Rights Recordation System. Finally, (3) pay the application fee (which is $190 per International Class of Goods). You read that right: you are purchasing a brand force with badges for ten years for under $200 bucks.
Next Step: INFORM. CBP needs to know about any authorized manufacturers and importers, as well as any known infringers, to help them seize infringing products for you. It’s essential that the initial application is filled out correctly. If the application misguides CBP or omits product information, customer deliveries could be delayed at the border (and no one wants that). CBP should know about any parent/subsidiary companies, any licensees able to use the mark, authorized manufacturers, and other authentication information that sets your products apart from counterfeits.
Barring requests for additional information and the need to occasionally renew and update your recordation, that’s all it takes.
Is Trademark Monitoring by the CBP Effective? (TLDR: yes)
In the 2021 fiscal year, CBP and other partner agencies apparently seized over 27,000 shipments containing goods that violated intellectual property rights, totaling an estimated MSRP of $3.3 billion in seized goods. Apparel and accessories comprised 30% of all intellectual property right seizures, though the agencies particularly focused on seizing COVID-19 related counterfeit, unapproved, or otherwise substandard items this past fiscal year: like test kits, face masks, and chloroquine tablets, 77% of which came from China.
E-commerce is a specific priority for CBP. In its E-commerce Strategy, CBP states that it will seek increased information sharing with e-commerce stakeholders that hold intellectual property rights to implement meaningful inspection strategies in small parcel shipments. This means that you should especially consider recording and sharing your company information with CBP if you sell goods that enter the U.S. from elsewhere, even in small shipments.
What are Best Practices in Working with the CBP to Monitor Trademark Infringement?
CBP encourages submission of “Product Identification Guides” and “Product Training Sessions” to assist CBP agents in distinguishing legitimate goods from fakes and other infringing products.
- You may submit a Product Identification Guide to CBP. CBP stores the guides on its secure e-recording system. An effective Product Guide should be brief, but include company name and contact information, basic description of the company, IP owned by the company with registration numbers, recordation number with CBP, physical characteristics of the products (with photos of genuine and suspect versions of the goods, if possible), manufacturing information, and an appropriate legal disclaimer.
- You may even give CBP a Product Training Session. This allows a direct interaction with CBP personnel to instruct CBP on how to identify your products at ports of entry. Sessions can be virtual or in-person.
What Happens after CBP Seizes Products that Infringe your Trademarks?
You, as the bona fide intellectual property holder, will benefit from CBP’s seizure without having to do very much on your end. Once CBP finds an imported shipment that infringes on your rights, they will “seize” the items, meaning they will take physical possession of the goods. Then, there are a few pathways.
One path involves a negotiation between you and the infringing importer. The importer may agree to license the IP from you by paying an agreeable licensing fee. Another option is for the infringer to remove all infringing marks within 30 days by “grinding off” or “removing and disposing of plates bearing a trade mark or trade name.” 19 C.F.R. § 133.22. Painting over the mark or covering it up is not enough. Finally, if the importer has not obtained release of detained articles within the period of detention, then the products are subject to forfeiture. All of those benefit you.
Contact Rockridge® for Comprehensive Trademark Strategies
Rockridge is a Best For The World B Corp working at the nexus of impact and innovation. We love helping clients launch and scale new brands, products and services. We work with clients throughout the U.S. in all aspects of intellectual property, litigation, M&A, privacy, technology transactions, and ventures. We’d love to connect!
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About Alex Smith
Alex is an associate attorney at Rockridge, focusing on branding, e-commerce, and ESG. She can be reached at alexandra@rockridgelaw.com.
