A. INTELLECTUAL PROPERTY ENTITLED TO TRADEMARK PROTECTION
(1) identifying a particular seller's goods and distinguishing them from goods sold by others;
(2) signifying that all goods bearing the trademark come from or are controlled by a single source;
(3) signifying that all goods bearing the trademark are of an equal level of quality; and
(4) as a prime instrument in advertising and selling the goods.
(1) a registrant has access to the federal courts without pleading any required amount in controversy, 15 U.S.C. § 1121;
(2) in federal court, lost profits, damages and costs are recoverable, and treble damages and attorney fees are available, 15 U.S.C. § 1117;
(3) evidence of registration is "prima facie evidence of the validity of the registered mark, . . . of the registrant's ownership of the mark, and of the registrant's exclusive right to use the registered mark. . . ." 2 McCarthy, § 19.05 (1995). 15 U.S.C. § 1057(b); and
(4) registration may be used to establish priority of trademark rights, as the registration would specify either the date of first use in commerce, 15 U.S.C. § 1051(a), or the date of the intent to use the mark in commerce. 15 U.S.C. § 1051(b). (74)
The Lanham Act only allows registration of marks "used in commerce," which means:
- the bona fide use of a mark in the ordinary course of trade, and not made merely to reserve a right in a mark. For purposes of this [Act], a mark shall be deemed to be in use in commerce -
- . . .
- on services when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services.
The word "commerce" means all commerce which may lawfully be regulated by Congress.
15 U.S.C. § 1027.
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B. THE CRIMINAL LAW
(1) the defendant trafficked or attempted to traffic in goods or services;
(2) such trafficking, or attempt to traffic, was intentional;
(3) the defendant used a "counterfeit mark" on or in connection with such goods or services; and
(4) the defendant knew that the mark so used was counterfeit.
492 U.S. 924 (1989); Rolex Watch USA, Inc. v. Canner, 645 F. Supp. 484, 489 (S.D. Fla. 1986).
goods or services of which the manufacturer or producer was, at the time of the manufacture or production in question authorized to use the mark or designation for the type of goods or services so manufactured or produced, by the holder of the right to use such mark or designation.
18 U.S.C. § 2320(d)(1)(B).
15 U.S.C. § 1116(d)(4)(B)(iii).
D. CONTRASTING THE TRADEMARK AND THE COPYRIGHT ACT
E. CHARGING BOTH CRIMINAL COPYRIGHT AND TRADEMARK VIOLATIONS
509 U.S. 688, 698 (1993) (citing Blockburger v. United States, 284 U.S. 299, 304 (1932)).
Accordingly, inconsistent verdicts from a trial involving charges of copyright infringement and
trademark counterfeiting should not jeopardize a successful conviction. See United States v.
Sheng, 26 F.3d 135 (9th Cir. 1994). Similarly, a jury's inability to reach a verdict on an
accompanying conspiracy count does not necessarily affect a finding of guilt on the substantive
count or counts. United States v. Steele, 785 F.2d 743, 750 (9th Cir. 1986)(criminal copyright
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72. "Service marks" are trademarks which identify a service as opposed to a product.
73. That clause grants to Congress the power "[t]o promote the Progress of Science and the useful Arts, by securing for Limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." U.S. CONST. art. I, § 8, cl. 8.
74. For a complete list of the advantages that federal registration offers, see 2 McCarthy, § 19.05 (1995).
75. Distinctive trademarks are trademarks such as "Exxon" that immediately serve as an identifier of the source of the product. See, e.g., Taco Cabana Int'l v. Two Pesos, Inc., 932 F.2d 1113, 1120 n.7 (5th Cir.), aff'd, 505 U.S. 763 (1992).
76. Trademarks that are non-inherently distinctive are not sufficiently "distinctive" to be automatically eligible for federal registration, but are eligible for registration if they have become distinctive through use.
77. A mark is "descriptive" if it is descriptive of (i) the intended purpose, (ii) function or use of the goods, (iii) the size of the goods, (iv) the class of users of the goods, (v) a desirable characteristic of the goods or (vi) the end effect upon the user. 1 McCarthy, § 11.05 (1995). A descriptive mark is usually accorded a narrow scope of exclusivity and is therefore deemed to be a weak mark.
78. Secondary meaning for a descriptive term is a matter of fact, to be determined from relevant evidence
probative of probable customer reaction. 1 McCarthy, § 11.09 (1995). According to McCarthy, "the Supreme
Court of North Carolina gave an excellent capsule definition of secondary meaning in the context of descriptive
Id. quoting Charcoal Steak House of Charlotte, Inc. v. Staley, 263 N.C. 199, 139 S.E.2d 185 (1964) ("CHARCOAL STEAK HOUSE" held descriptive; nonsuit affirmed on basis of no likelihood of confusion).
79. Such a mark may, however, be capable of acquiring distinctiveness if a manufacturer is able to show that apple gum were to be uniquely identified with one particular producer.
80. Two years of continuous non-use is presumptive of abandonment, but the presumption can be rebutted by proof of lack of intent to abandon. Thus, if nonuse results because of economic pressures -- but not as a result of intent to discontinue use -- the nonuse may be excused and held not to constitute abandonment.
81. The Act also covers trademarks protected by the Olympic Charter Act. The designations protected are set forth at 36 U.S.C. § 380.
82. Also excluded from the definition of counterfeit mark are so-called "parallel imports" or "grey market"
goods, which are trademarked goods legitimately manufactured and sold overseas and then imported into the United
States outside of the trademark owner's traditional distribution channels. Thus the criminal statute cannot be used to
reach those who traffic in goods that were produced by a licensed manufacturer at the time that the license was
valid, even if the goods were then sold at a time when the license was not. See Joint Statement at 12079. Neither is
the statute intended to apply to mere imitations of "trade dress," such as the color, shape, or design of a product or
its packaging -- unless such features are also registered as trademarks.
83. See also Brian J. Kearney, The Trademark Counterfeiting Act of 1984: A Sensible Legislative Response to the Ills of Commercial Counterfeiting, 14 Fordham Urb. L.J. 115, 119-120 (1986).
84. For a detailed discussion of the elements of money laundering and for Department of Justice policy see U.S.A.M. 9-105.000 and Money Laundering Federal Prosecution Manual, June 1994, Money Laundering Section, United States Department of Justice.
86. The court in Song did not address cases where a vendor sold different types of goods, some of which might carry the same counterfeit mark.
87. Effective November 1, 1993, the previous § 2B5.4 (Criminal Infringement of Trademark) was deleted in its entirety and consolidated with § 2B5.3, which now controls criminal infringement of a copyright or trademark. See Sentencing Guidelines Appendix C, amendments 481 and 482.
88. The narrow view of "loss" adopted in this portion of the Guidelines fails to recognize the potentially more sizeable losses suffered by legitimate sellers in the form of lost retail sales. Note that guidelines for similar offenses adopt a broader concept of "loss." See e.g.,U.S.S.G. § 2B1.1 (Larceny, Embezzlement, and Other Forms of Theft) (Commentary, Application Note 2) ("Where the market value is difficult to ascertain or inadequate to measure the harm to the victim, the court may measure loss in some other way, such as reasonable replacement cost to the victim."). See also United States v. Cianscewski, 894 F.2d 74 (3d Cir. 1990) (cost to victim of stolen check is full amount of check, not price at which stolen check is resold); United States v. Wilson, 900 F.2d 1350 (9th Cir. 1990) (sentencing court acted reasonably when it considered victim's development cost to measure intended loss, and was not limited to strict market valuation of loss).
89. The court in Kim analyzed § 2B5.4 and not § 2B5.3. However, the language in the former section was identical to the present § 2B5.3 and was consolidated into that section. Thus, the Kim decision seems equally applicable today.
90. On July 2, 1996, Congress amended this subsection to permit any "state or local law enforcement officer" to carry out a seizure of infringing items. Anticounterfeiting Consumer Protection Act of 1996, Pub. L. No. 104-153, 110 Stat. 1386 (1996). Prior to this, only "United States Marshals" were specifically authorized to carry out a seizure order. The court also has the discretion to appoint a security agency to carry out the seizure, as well as to allow the plaintiff's attorney to accompany and assist the law enforcement officials executing the order. 15 U.S.C. § 1116(d)(9).
91. Under this provision, ex parte seizures can only be made of "counterfeit goods," which excludes "parallel imports," "gray goods" and "production overruns." (For a discussion of these terms see "Lanham Act defenses," supra
p. 59). Thus, the scope of this provision equals that of 18 U.S.C. § 2320.
92. According to the joint statement:
Joint Statement at H12081.
93. It should also be noted that the trademark counterfeiting seizure provision requires that civil litigants seeking to obtain ex parte seizure of infringing goods notify the U.S. Attorney of such intentions; no such requirement is placed on litigants seeking ex parte seizure in copyright cases.
94. Note that in such cases, prosecutors might also consider the propriety of charging violations of 18 U.S.C. § 2318. See "Trafficking in Counterfeit Labels, 18 U.S.C. § 2318," supra p. 42.
95. Literally thousands of trade and service marks have been registered, relatively recently, by the computer
industry. A very small sampling of marks contained on the principal register appears below: