Congress Bolsters Enforcement of Intellectual Property Rights

November 2008

On October 13, 2008, President Bush signed into law Senate Bill 3325, entitled the “Prioritizing Resources and organization for Intellectual Property Act of 2008.” According to an October 14, 2008 press release issued by Senator Voinovich (R-OH), the Act strengthens civil and criminal laws against counterfeiting and piracy by increasing statutory damage awards in civil counterfeiting cases, strengthening remedies available in the prosecution of criminal cases involving counterfeiting and piracy, enhancing resources for Department of Justice programs that combat IP (intellectual property) theft, and making the President’s Strategy Targeting Organized Piracy (STOP!) program permanent. (Information on the STOP! program can be accessed by clicking here.)

With respect to statutory damage awards for trademark infringement, the Act raises the statutory damage limits from between $500 and $100,000 per counterfeit mark to between $1000 and $200,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed and to $2,000,000 per counterfeit mark for willful infringement. In this context, the term “counterfeit mark” refers to the unauthorized use of someone else’s trademark in connection with goods or services that do not emanate from the owner of the mark (for example, fake “Rolex” watches). As explained in our April 2006 issue of Intellections, statutory damages are damages awarded by the court based on the infringement of a federally registered trademark. If a trademark owner elects to receive statutory damages, then there is no need to prove actual damages.

In terms of criminal remedies, the Act makes restitution a mandatory remedy in all cases of criminal copyright infringement under Section 506 of the Copyright Act. Section 506 prohibits willful infringement of a copyright (i) for commercial advantage or private financial gain, (ii) by reproducing or distributing (including by electronic means) one or more copies of a phonorecord with a total retail value of more than $1000 in any six-month period, and (iii) by making a work available on a computer network accessible to members of the public, if the work is being prepared for commercial distribution and the person distributing the work on the computer network knew or should have known that it was intended for commercial distribution. In this context, the term “phonorecord” means a physical recording of a work and includes CDs. The Act also directs the Secretary of Homeland Security to issue regulations that would allow a performer to be notified by U.S. Customs and Border Protection of the importation of pirated copies of a live musical performance.

As for the Department of Justice, the Act allows the Department to make grants to state or local law enforcement entities for training, prevention, enforcement and prosecution of IP theft and infringement crimes. In addition, the Act calls for at least ten additional FBI agents to support the Computer Crime and Intellectual Property Section of the Criminal Division of the Department of Justice in the investigation and coordination of IP crimes and at least one FBI agent to support each Computer Hacking and Intellectual Property Crime Unit within the Department of Justice. The Act requires that all Computer Hacking and Intellectual Property Crime Units located at an office of a United States Attorney have at least two Assistant U.S. Attorneys responsible for investigating and prosecuting computer hacking or IP crimes. It also requires that the Department implement a regular and comprehensive training program, including relevant forensic training, to ensure that FBI agents are trained in the investigation and prosecution of IP crimes.

In addition to enhancing existing programs for IP rights enforcement, the Act creates a new position called the Intellectual Property Enforcement Coordinator (IPEC). The person who serves in this position will report to the President, and his or her nomination must be confirmed by the Senate. The IPEC’s duties will include coordinating the development of a Joint Strategic Plan against counterfeiting and infringement, facilitating the issuance of policy guidance to departments and agencies on basic issues of policy and interpretation, and reporting to the President and Congress on domestic and international IP enforcement programs.

Antoinette M. Tease testified on IP rights enforcement issues before the Senate Finance Committee on March 13, 2008. A copy of Ms. Tease’s written testimony and a video of her oral testimony can be accessed by clicking here.


Amicable photo of Toni

Antoinette M. Tease, P.L.L.C.