Part 1 of this blog discussed the advantages of a proactive and integrated IP protection strategy. Here, in Part 2, we address the benefits and weaknesses of the various IP protections and provide one example of a cohesive and layered IP protection and enforcement strategy. 

Both Design and Utility patents can be enforced against imported counterfeit products. In both cases, however, the product must be found to infringe the patent in a “Section 337” proceeding before the International Trade Commission (the “ITC”). The ITC has statutory authority, under the Tariff Act of 1930 (19 U.S.C. §1337), to issue exclusion orders to prevent the entry into the U.S. of infringing products, and to issue seizure and forfeiture orders against specific imported products. A Section 337 hearing before the ITC is, essentially, an administrative adjudication of IP infringement claims brought by domestic rights holders.  The process can take several months, but, if successful, Customs and Border Protection (“CBP” or simply “Customs”) will enforce an exclusion order by denying the entry of the specific infringing product(s), but only for those specific products identified in the proceeding.

By comparison, the process to register and record either trademarks or copyrights with Customs is relatively simple. Registering a trademark will require about the same or slightly less time than needed to register a design patent, and is usually less expensive. Moreover, trademark registrations have the advantage of lasting forever if they continue to be used and renewed. Copyrights may be registered the fastest by requesting special handling by the Copyright Office and the payment of an additional fee. Even with the additional fee, copyright registrations are the least expensive registration to obtain and have the longest initial term. Both trademarks and copyrights may be recorded with Customs after a federal registration is issued, after which CBP may stop and detain suspect goods at the border, and seize products that bear counterfeit trademarks or include pirated copyright material. The same trademark and copyright registrations may also be used to sue infringers, to seize (and in many cases destroy) infringing products under court order, and receive damages for IP infringement. It is important to note that in addition to being required for recordation with Customs, a Federal copyright registration is also required to be able to maintain a lawsuit against an infringer.

Take, for example, a wrist watch that has:

• both functional and aesthetic design features that can be protected with utility and design patents, respectively;
• a unique product design that can be protected with a 3-dimensional trademark registered on the Supplemental Register;
• an inherently distinctive and trademarkable product packaging design registered on the Principal Register;
• a trademark on the brand name and/or logo placed directly on the watch and/or on the packaging registered on the Principal Register;
• a registered copyright on the operating and/or care instructions provided with the watch; and
• a registered copyright on an aesthetic design element(s) of the product and/or product packaging.  

Of course, not every form of IP will apply in each instance. For example, certain product features might be patentable based on their function, but not capable of being trademarked because of that same functionality. Nonetheless, for this example, presume they are all available.

First, it is important to recognize that regardless of the strategy employed, the product, product packaging, and included instructions should be marked with appropriate copyright, trademark, and patent pending notices: “TM” for unregistered (i.e., “Common Law”) and ® for registered trademark claims, “Patent Pending” for pending patent applications and “Patent X,XXX,XXX” or “Pat. X,XXX,XXX” for issued patents, and “© 201_ Aggrieved Manufacturer” for copyrighted works.  These notice markings are not always required for IP rights enforcement, but they can be crucial to obtaining the greatest possible remedies or damages in cases of willful infringement, and their use is always recommended.

For this example, one strategy would be the following approach:

1. Presuming the applicable registrations are not already in place, immediately file:
   1. Copyright applications under the Customs Matters special circumstances for the operating and/or care instructions, and any aesthetic packaging design element(s);
   2. Trademark applications seeking registration of the brand name, the packaging design and/or logo on the Principal Register, and registration of a 3-dimensional product design trademark on the Supplement Register; and
   3. Design and Utility patent applications.
2. When the copyright registrations issue, record them with CBP. Imported products with infringing copies of the registered works may be detained and seized by Customs at the border, without entering U.S. commerce.  
3. At any time, common law rights in any of the applicable trademarks may be used in court and/or ITC enforcement proceedings directly against an infringer. When the Supplemental Registration issues for the 3-dimensional design trademark, it can also be used in common law actions to enforce rights in the mark. Note, however, that any protection will not be strong until the mark has acquired distinctiveness through (among other things) significant sales success, advertising expenditures, and public recognition of the mark as a source identifier for your product. Although trademarks registered on the Supplemental Register cannot be recorded with Customs, this is an important part of the strategy and will be further explained below.
4. When the name, packaging design and logo trademark registrations issue on the Principal Register, record them with CBP. This gives Customs another basis to detain and seize imported products bearing counterfeit or confusingly similar marks at the border and without entering U.S. commerce.
5. After five (5) years on the Supplemental Register and continuous and strong use, file a new application to register the 3-dimensional design trademark on the Principal Register based on its acquired distinctiveness. After the registration is issued, record it with CBP as well. Because 3-dimensional design trademark protection is very similar to design patent protection, which only lasts for 15 years after issue, and because trademark protection can last forever if it is used and renewed properly, protection of the product design can be extended indefinitely. As a result, by combining design patent and 3-dimensional design trademark protections, we have patent protection right from the issuance of the design patent while the 3-dimensional design trademark is acquiring distinctiveness and trademark protection before and after the design patent expires.
6. After the design patent issues (in about a year), letters can be sent to potential infringers, ranging from those that merely inform them of the patent and invite them to contact you to discuss licensing terms to a full-blown, no-holds-barred, cease and desist letter that flat-out accuses potential infringers of infringing the patent. Similar letters may be sent to potential infringers after the utility patent issues, although this can take several years, depending on the technology and uniqueness of the product.
7. Alternatively, either or both the design and utility patents can provide a basis for a Section 337 action at the ITC, which, if successful, will be enforced by CBP, resulting in either the exclusion of infringing products or their seizure. As noted above, any applicable trademarks may also be used as a basis for a Section 337 claim.

In the annotated timeline above the solid yellow highlighting is used to indicate the duration of the individual IP protections and to illustrate the overlap that occurs between the different IP protections. The yellow highlight outline is used to show optional/additional patents that might be available. Likewise, the red triangles are used to indicate when that IP protection can be recorded at CBP.

While only a single example has been provided here, it should be understood that multiple strategies are possible and that they can be tailored to fit the type of product to be protected as well as the desires and resources of the manufacturer.

Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.

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