Remedies of enforcement are available to trademark, copyright and patent owners through U.S. Customs. Given the usual complexity in determining whether a patent is valid and has been infringed, not surprisingly, the available procedure through U.S. Customs as to patents is relatively complex. While this same, complex procedure may also be followed for trademarks and copyrights, enforcement in these cases may be handled through other, far more expeditious and less costly procedures at U.S. Customs.

A U.S. company may initiate a proceeding against foreign companies before the United States International Trade Commission ("ITC") for violation of its intellectual property rights, whether patent, trademark or copyright. ITC litigation is particularly fast-paced and especially burdensome for foreign respondents. Indeed, in response to complaints from foreign parties, ITC litigation has recently been modified to make these proceedings somewhat less onerous.

ITC practice currently requires that the proceeding be completed "at the earliest practicable time" rather than, as was formerly the case, completed within 12 months, such that the trial effectively had to take place within approximately seven months. Thus, a "target date" for completion is set by the presiding judge within 45 days of the commencement of the case. Congress, in passing the legislation abolishing the 12-month deadline, expressly made clear, however, its hope that ITC proceedings would continue to be resolved in approximately the same amount of time.

Jurisdiction before the ITC remains in rem , rather than personal. Therefore, compliance with discovery obligations is vitally important, lest the responding party face default sanctions. The ITC will not hear counterclaims, although such counterclaims can now be asserted by respondents, who must then move for immediate removal of the counterclaims to district court. Potential remedies remain harsh, including exclusion orders barring goods at Customs and cease and desist orders for goods sold in the United States, which carry a penalty of the greater of $100,000 per day or twice the value of the goods entered in violation of the order.

Concurrent litigation in district court also remains a possibility, although a respondent can now obtain a stay of that portion of the court proceeding that involves the same issues as are before the ITC. The application for such a stay must be made within 30 days of being named a party to the later of the court or ITC action.

While ITC proceedings are no longer quite as burdensome, they remain difficult, time consuming and unique in certain respects. For example, there is an additional party to the proceeding, namely the Commission Investigative Attorney. Additional elements must be proven, separate and apart from the complainant's claimed violation of its intellectual property rights, such as the existence of a domestic industry, that do not exist in district court litigation. Moreover, unlike district court litigation, a jury trial is not available. Significantly, there is no monetary recovery at the initial stage before the ITC.

In order to commence an ITC action, the complainant must be either the owner or an exclusive licensee of the property at issue. If the case involves the infringement of a patent, registered trademark, registered copyright or maskwork, the complainant need only show that there is an industry in the United States with respect to the items covered by that patent, copyright, trademark or maskwork, such that the industry exists or is in the process of being established. The term "industry" means that there has been significant investment in plant and equipment or significant employment of labor or capital or substantial investment in exploitation of the property. In cases of unfair methods of competition, such as false advertising or passing off, additional showings must be made, such as potential destruction or substantial injury to an industry in the United States or prevention of the establishment of such industry or the restraint and monopolization of trade and commerce in the United States.

In contrast to all other forms of litigation, notice pleading is not sufficient in ITC proceedings. Rather, great specificity is required. The initial complaint must establish standing, set forth in detail facts constituting the alleged unfair methods or the instances of unlawful imports and sales, as well as must describe the allegedly harmful effect upon the domestic industry. In the case of patent infringement, additional information is required, including specifics concerning each patent, licensee, foreign and corresponding patents, a non-technical description of the patent, and a chart of the claims infringed. Other voluminous documents must also be presented, including patent file histories. The complaint must be under oath, and the complainant must identify those portions that it views as "confidential business information".

The parties to the proceeding consist of the complainant, the respondents, i.e., the foreign manufacturer as well as usually the importer and distributor, and the Commission Investigative Attorney, who is neutral until submission of pretrial statements. Given the normally fast pace of this proceeding, the ITC imposes upon parties a duty of candor. A failure to disclose material or the providing of false information with intent to deceive will result in a dismissal with prejudice and/or monetary sanctions. A submission of a pleading constitutes certification that the pleading is objectively grounded and not for improper purposes.

After the complaint is filed, the Office of Unfair Import Investigations, through the Commission Investigative Attorney, normally conducts an examination for compliance with ITC rules, makes contact with the complainant and may even request amendments or supplementation. In most instances, the Commission will decide within 30 days whether to commence an investigation. Throughout that period, the respondent is usually unaware that the complaint has been filed. In contrast, the complainant normally uses this time to contact witnesses, compile evidence and prepare extensive discovery requests. Within a few days of a decision to commence an investigation, notice is given to the respondents. The domestic respondents have 23 days and the foreign respondents 30 days from service to respond. The response, like the complaint, must be very detailed and include data on imports and, in patent cases, a chart showing why the claims of the patent are not infringed.

The Administrative Law Judge ("ALJ") assigned to the case immediately issues a protective order so that commercially sensitive information can be exchanged. Typically, the ALJ also simultaneously issues ground rules for the proceeding. At a preliminary conference, the ALJ will typically set deadlines for identifying witnesses and prior art, making discovery related motions and submitting witness statements, among other things. The ALJ now has broad authority to set time limits for answering discovery. As with district court and PTO practice, all methods of discovery are permitted, including interrogatories, requests for production of documents, requests for admission, inspection of plants and depositions. The parties will normally stipulate to an acceptable manner of service for the exchange of discovery-related documents. Given the typically fast pace of this proceeding, conference calls with the ALJ are quite common. Fortunately for the foreign party, monetary sanctions are now available for discovery abuses, which will hopefully serve as a strong deterrent.

A variety of motions are possible. A motion to amend pleadings, must, however, be made early to avoid a claim of prejudice. A motion for temporary relief may also be made. The motion for temporary relief will typically be followed by limited discovery and a hearing. Another common motion is a motion for summary determination, which must be filed at least 30 days prior to the hearing.

The trial before the ITC is governed by the Federal Rules of Evidence and consists of live testimony, although written witness statements are often submitted in place of direct testimony. Following the issuance of an "initial determination" by the ALJ, the full Commission decides whether to review the decision. If the Commission chooses not to do so, the initial determination automatically becomes the Commission's final decision. If a review is undertaken, then the Commission will decide whether there is a violation and will also consider the public interest, by examining such considerations as the public health and welfare, competitive conditions in the U.S. economy, the production of like or directly competitive articles in the U.S. and the interest of U.S. consumers.

Possible remedies include general and limited exclusion orders. However, pursuant to the recent amendments to the ITC rules, general exclusion orders, i.e., orders preventing importation of the identified goods from a particular country, regardless of specific source, may only be issued (i) to prevent circumvention of a limited exclusion order; or (ii) where there is a pattern of violation in which a specific source is difficult to identify. The Commission may place time limits on the duration of both general and limited exclusion orders. As to the named respondents, specific cease and desist orders will be issued.

Technically, the President has the right to review the Commission's final determination, but, in fact, this is an extremely rare occurrence. Thereafter, the Commission's decision is subject to review by the Court of Appeals for the Federal Circuit. The Federal Circuit gives great deference to the Commission's remedy determination and will reverse that determination only if the Commission's choice of remedy is arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law.

A decision by the Commission, however, is of limited precedental value. A decision finding patent validity and infringement is not res judicata (binding upon the parties in subsequent litigation), even though the decision may have subsequently been reviewed by the Federal Circuit. Conversely, though, a finding of non-patent infringement is binding, even if there has been no Federal Circuit review.

The U.S. Customs Service offers an effective and far more inexpensive avenue for protecting trademarks, trade names and copyrights. While U.S. Customs has, of course, limited resources to discover infringing merchandise at its ports of entry into the United States, recordals with U.S. Customs are particularly effective in the case of high profile, counterfeit merchandise. Moreover, a close working relationship between an intellectual property owner and U.S. Customs will greatly further that effectiveness.

In order to obtain protection through U.S. Customs, a trademark must first be registered in the PTO. Similarly, protection for copyrights requires that the copyright first be registered with the United States Copyright Office. Once the trademark or copyright is registered, the owner may then apply to record the trademark or copyright with U.S. Customs by submitting a minimal fee, a certified copy of the certificate of registration for the trademark or copyright and the pertinent information to assist U.S. Customs to determine if goods entering the United States are authorized or unlawful. Typically, such information includes the country of manufacture of genuine goods and the names of foreign (non-United States) licensees or other parties authorized to use the trademark or copyrighted work.

In the case of trademarks, in particular, the trademark owner must also identify any parent or subsidiary company or other foreign company under common ownership or control of the trademark owner. Such information enables U.S. Customs to determine whether goods bearing the deposited trademark registration are parallel imports or so-called "gray market goods". Gray market goods are considered genuine goods, because they were produced by or with the authorization of the trademark owner, notwithstanding that the trademark owner may not have authorized such goods for distribution in the United States. Foreign owners of United States trademarks may not prevent importation into the United States of gray market goods. This same rule does not apply to copyrights that are deposited with U.S. Customs. Indeed, in contrast to trademark law, where the issue of gray market goods has been bitterly fought in the courts with the result that gray market goods are considered lawful, unless the foreign originating goods are materially different, in the copyright area the U.S. copyright laws bar distribution in the United States of copyrighted materials, notwithstanding prior foreign distribution.

Typically, a trademark or copyright is recorded within approximately two weeks from receipt of the application. Confirmation that the recordal has been effected can be obtained on-line from the U.S. Customs electronic bulletin board. An official Notice of Recordation is later mailed to the filing correspondent, although this mailing of notice can take several months. A trademark recordal with U.S. Customs is effective for the duration of the trademark registration (10 years for registrations issued on or after November 16, 1989) and must be renewed when the trademark registration is renewed. The copyright recordal remains in effect for 20 years or until the expiration of the copyright registration, whichever is shorter. If the copyright registration is still in effect after 20 years have passed, the owner may renew the recordation.

The process for recording a trade name is somewhat different, because trade names cannot be registered with the PTO. In order to be eligible for U.S. Customs recordation, the owner must have used the trade name for at least six months. The owner may then apply for recordation by identifying the trade name and a description of the merchandise with which the trade name is associated. As with an application to record a trademark, the owner must also identify foreign parties licensed or authorized to use the trade name as well as any parent or subsidiary company or other foreign company under common ownership or control of the trade name owner. In addition to a nominal fee, the applicant must also submit a statement by the owner as well as statements from two other persons not associated with the owner, stating that, to the best of their knowledge (1) the trade name has been used in connection with merchandise described in the application for at least six months; (2) the trade name is not identical or confusingly similar to any other trade name or registered trademark used in connection with the applied-for class of merchandise; and (3) the applicant has the sole and exclusive right to use the trade name in connection with the applied-for class of merchandise.

After processing the application, U.S. Customs notifies the public, by publication in the Federal Register and the U.S. Customs Bulletin, of the tentative recordation of the trade name so that interested parties are given an opportunity to oppose the recordation. U.S. Customs will then consider any objections to the recordation, and once resolved, will publish the final approval or disapproval of the application in the Federal Register and the U.S. Customs Bulletin. A recordal of a trade name remains in force so long as the trade name is used. U.S. Customs may periodically inquire of a trade name owner to determine whether the trade name is in use. Failure to respond to such a request will be considered as evidence of disuse.

In contrast to trade names, trademarks and copyrights, where U.S. Customs is authorized to record a party's rights (and competent to decide substantive issues), U.S. Customs has no such authority in the area of patents. Instead, for a fee, U.S. Customs will survey imports and advise the patent owner of the names and addresses of importers whose goods, in U.S. Customs' view, may infringe the registered patent. The application for a patent survey requires a certified copy of the patent issued by the PTO and a list of merchandise believed to infringe the patent, including, if available, where and by whom the potentially infringing merchandise is believed to be manufactured. Information concerning the name used for non-infringing product and the manner in which the product is used as well as the name and telephone number of a technical specialist with whom U.S. Customs can consult and a sample of the product should also be provided. This survey information is arguably useful as a means for obtaining evidence for a case to be brought before the ITC or for use in developing a patent infringement lawsuit. U.S. Customs will only enforce exclusion orders, or seizure and forfeiture orders, however, where such orders are first issued by the ITC.

Where a trademark, trade name or copyright has been recorded, U.S. Customs has the authority to deny entry into the United States of goods that infringe upon the recorded right.

U.S. Customs will seize at the port of entry to the United States infringing copies of a copyrighted work, meaning copies made without the authorization of the copyright owner. Seized goods will be forfeited unless the importer files and succeeds in a formal petition seeking relief from the seizure. If U.S. Customs only suspects that an imported article may infringe a recorded copyright, the article will be detained and the importer notified. The detention is not a formal seizure, but rather a delay in the disposition of the goods to determine if a seizure is warranted. The importer has 30 days from notice of detention of the article to deny that the article is an infringing copy. In the absence of such a denial, the article will be seized and subject to forfeiture as an infringing copy. If a denial is filed by the importer, then the copyright owner will be notified and provided with a copy of the imported article. The copyright owner then has 30 days from such notice to demand in writing that the detained goods be excluded from entry. The copyright owner may also be required to post a bond so that the importer is held harmless for the detention of the articles, if it should later turn out that the article is not an infringing copy.

Upon receipt of such written notice and a proper bond, U.S. Customs will inform both the importer and the copyright owner that it will hold an adversary proceeding. The parties will then be entitled to submit additional evidence, legal briefs or other material to substantiate their respective positions. The burden of proof is upon the copyright owner to prove that the articles are infringing. The Commissioner of Customs will then rule on the claim of infringement. Alternatively, the copyright owner may file suit in district court and seek a ruling on infringement and an order enjoining the importation of the allegedly infringing articles. The filing of a lawsuit is, of course, an available forum to all copyright owners, regardless of whether a copyright has been recorded with U.S. Customs. If the copyright has not been recorded with U.S. Customs, however, the copyright owner must pay the requisite fee to U.S. Customs at the time it attempts to enforce the injunction through U.S. Customs.

U.S. Customs likewise will generally deny entry to goods bearing a mark or name that copies, simulates or is identical to a trademark or trade name that has been recorded with U.S. Customs. In contrast to copyrighted goods, U.S. Customs will not deny entry to such goods, however, where the foreign and the United States trademark or trade name are owned by the same party or where the foreign and domestic trademark or trade name owners are parent and subsidiary companies or are otherwise subject to common ownership and control. Such "gray market" goods will be denied entry only if they have been imported without authority of the trademark owner and are "materially" different from authorized goods, e.g., in terms of quality.

If U.S. Customs decides to detain goods that copy, simulate or bear a mark or name identical to a recorded trademark or trade name, U.S. Customs will then notify the importer of the detention. The goods will be detained for 30 days from such notice to allow the importer adequate opportunity to establish that the goods should be released. Failure to obtain release results in the seizure of the detained goods, and the importer may either petition for relief from the seizure or else forfeit the goods.

U.S. Customs may also seize goods that bear counterfeit trademarks and provide notice of the seizure to the trademark owner. "Counterfeit" means "a spurious trademark which is identical with, or substantially indistinguishable from, a registered trademark." Under these circumstances, unless the trademark owner consents to the importation of the articles or some other appropriate disposition thereof, the articles will be forfeited. As with articles detained because they copy, simulate or bear a mark identical to a recorded mark, the importer may petition for relief from the forfeiture. Such relief is, however, rarely granted.

Except for articles bearing counterfeit trademarks, an importer may petition for conditioned relief from forfeiture by agreeing to export or destroy the goods under U.S. Customs supervision, without any expense to the United States government, or by removing or obliterating the offending trademarks or trade names prior to the release of the articles, or, in the case of certain books violating the Copyright Act, proof that an abandonment of copyright has been filed and obliteration of the notice of copyright.

U.S. Customs will dispose of articles that are forfeited for trademark or trade name violations, except for those bearing counterfeit trademarks, in any manner that is in accordance with U.S. Customs policy and procedure. In contrast, U.S. Customs is limited in the ways in which it can dispose of forfeited goods bearing counterfeit trademarks, after obliterating the mark therefrom, to delivery to a government agency, a gift to charity, sale at a public auction or destruction. Goods forfeited for copyright violations will be destroyed.

In contrast to copyrights, there is no clear proceeding before U.S. Customs to resolve trademark disputes. Thus, the U.S. Customs regulations provide that importers may protest decisions of the district director for U.S. Customs at a particular port of entry, where the decision excludes merchandise from entry. The protest must be filed within 90 days after the date of notice of the decision excluding merchandise from entry and must follow a specific format. U.S. Customs reviews the protest within 30 days from its filing date. The regulations also provide for further review of the protest by the Commissioner of Customs. Alternatively, any person whose protest has been denied may contest the denial by filing, within 180 days after the mailing of the notice of denial, a civil action in the United States Court of International Trade ("CIT"), the federal court that hears actions filed against the United States and its agencies.

The U.S. Customs regulations also permit an importer or "other interested person" to request a "ruling" on a subject matter which "usually [does] not relate to specific matters or situations presently or previously under consideration by any U.S. Customs Service field office" and, as such, the ruling will normally be prospective in application. (U.S. Customs may, of course, decline to rule on the request if it concludes that the question cannot be answered.) Nevertheless, the regulations do not bar an interested party from seeking a ruling from the Headquarters Office in Washington, D.C. on a matter currently pending before a field office. Thus, both trademark owners and importers may seek a ruling from the Commissioner of Customs concerning goods that are being detained by a field office, when there is a dispute as to the infringing nature of the goods. In response, U.S. Customs may issue a ruling directly addressing the request.

If U.S. Customs refuses to issue a ruling requested by an importer, the regulations provide that an importer may appeal to the CIT. Such an appeal requires the importer to demonstrate irreparable harm in the absence of an opportunity to obtain judicial review prior to the importation of the merchandise. The applicable regulation is silent on the right of other interested parties, e.g., trademark owners, to likewise seek such judicial review. Further, while the statute governing jurisdiction of the CIT provides that court with exclusive jurisdiction to review a "ruling", nevertheless, the regulation concerning appeal to the CIT is permissive, and, therefore, it is unclear whether importers may also be entitled to commence actions in district court to challenge a ruling.

In fact, the appeal process in trademark disputes is further clouded by court precedent. Federal district courts have heard actions brought against U.S. Customs by trademark holders seeking an injunction against the importation of infringing merchandise. On the other hand, the CIT has refused to hear cases brought by an importer against U.S. Customs for the release of goods, where the CIT would be required to determine the merits of the underlying trademark dispute, not merely the validity of the notices issued by U.S. Customs. Arguably, the CIT is the proper forum for a dispute involving the propriety of a U.S. Customs ruling or denial of a protest, and district court is the appropriate forum for a trademark dispute that involves the underlying merits of trademark claim, such as the validity of the mark, but implicates U.S. Customs only insofar as the trademark owner is requesting an injunction against the importation of infringing goods.