Getting ahead of the curve: how the counterfeit notification act could affect Utah companies

Rebecca Olds 
Salt Lake Business Journal 

HR4930 passed the U.S. House Ways and Means Committee by a 40-0 vote on Dec. 10 and will continue on for further discussion. 

Reps. Blake Moore, R-Utah, and Brad Schneider, D-Illinois, have referred to HR4930 as the “Counterfeit Notification Act,” a bill focused on limiting counterfeit goods in the United States and to help “improve enforcement of IP laws” with American businesses.

“Counterfeit products undermine American innovation, steal American jobs, and present an unacceptable safety risk,” the bill states.

Under the bill, Customs and Border Protection would gain expanded ability to “share packing and shipping information of suspected counterfeit products with key intellectual property rights holders, transportation carriers, and e-commerce platforms.” This would help CBP identify and remove counterfeit goods from the U.S. economy.

“The global economy is flush with threats from counterfeiters, IP thieves and black-market traders,” Moore said. “This bill will unlock real-time intelligence sharing between CBP and the private sector that will help shut down these networks and cut off the flow of counterfeit products before they reach American shores. This will safeguard American businesses and protect our citizens from dangerous counterfeit goods. I’m thrilled that this bill has generated strong bipartisan support and unanimously passed through the Ways and Means Committee today.”

Under this bill, the CBP could share:

• Shipping labels and tracking numbers.

• Sender and recipient addresses.

• Invoices and manifests.

• Outer packing images, weight notations and box markings.

• Container-level packing info and data.

R. Parrish Freeman, patent law firm attorney at Maschoff Brennan, said it’s still early to say how this could specifically affect Utah companies, as more details and rules will most likely be hashed out in more detail during the future rulemaking process. But, there are a few things to note.

Here’s how Freeman said the bill could affect Utah businesses:

• Offer uniform support from rights holders. The bill would include expanded protections for those companies who register trademarks with CBP.

• Create shipping challenges for small businesses that haven’t registered marks with CBP. If a business’ shipments are part of a flagged counterfeit shipment, its part of the shipment could face holds and miss critical selling seasons.

• Expose trade secrets. By sharing more detailed supply chain information with CBP, it could risk exposing trade secrets if the information is passed to competitors, particularly harming small businesses. This is dependent on what is meant by the info being shared by “key stakeholders.”

Even if the bill doesn’t end up making it any further, one thing businesses can learn from is to register a brand with CBP.

“You have to have a registered trademark over copyright, and you have to have been taking the additional step to record it with Customs and Border Protection,” Freeman said. “That’s usually just the big guys that have done that. It’s not terribly expensive to do; it’s just the smaller businesses don’t know about it as an easy means to protect their marks.”

Parrish Freeman, at Maschoff Brennan, is an experienced litigator whose practice is focused primarily on patent, trademark and other intellectual property and complex commercial matters.