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SGMA Endorses New Laws to Further Protect Intellectual Property

One Law Discourages Counterfeiters, the Other Focuses on Famous Marks

Street vendors beware! The Sheriff just got two new weapons in the war against fake products.

On October 6, President Bush signed into law, legislation to deter dilution or debasement of famous trademarks. This follows enactment of a law in March to prohibit trafficking in counterfeit labels and other markings.

Trademark Protection
The Trademark Dilution Revision Law (PL 104-98) was created in response to a 2003 Supreme Court ruling that maintained the owner of a famous mark must show “actual dilution” rather than “likely dilution” to receive an injunction and damages from a company using a similar name. In this case it was “Victoria’s Secret” claiming “Victor’s Secret” was benefiting from the similarities in both products and name.

Under current law “dilution” is defined as “lessening the capacity of famous marks to identify and distinguish goods and services.” The new law defines “famous” as widely recognizable by the general public as a designation of source for the goods or services provided by the marks owner. Most significantly the new law would not require the owner of a trademark to show actual economic harm to receive an injunction against continued use of the deceptive mark.

Counterfeiting
The Stop Counterfeiting in Manufactured Goods law became necessary when the U.S. Court of Appeals for the 10th Circuit overturned a conviction of a business operator who provided counterfeit labels which were attached to generic products. The Court ruled that the labels themselves did not violate federal trademark statutes in that they were not attached to any product.

The new law prohibits the production of and trafficking in fake labels, medallions, patches, emblems, patches, stickers, wrappers, containers or packaging of any type or nature intended to deceive the consumer. Owners of equipment used to produce fake labels etc. would be required to destroy the equipment. Counterfeiters would pay restitution to the owner of a trademark and anyone directly harmed by counterfeiting.

The law would not allow for the prosecution of sellers who repackage genuine goods or services not intended to deceive or confuse consumers. Trafficking is defined as having the intention to or actually transporting, disposing or transferring goods or services for commercial advantage or private financial gain.

Reporting IP violations
While these laws will help in the battle to stop domestic deception and counterfeiting, there is still a long way to go on the international front. The Department of Commerce has set-up a special website on enforcement of intellectual property laws. SGMA encourages anyone wanting more information or wishing to report overseas counterfeiting to go to www.stopfakes.gov.

SGMA lent its support to these two initiatives as they moved through Congress and we are pleased that those efforts resulted in new laws. These laws will preserve the value of products by providing greater protection to the intellectual property of the owner of sporting goods marks.