SEMA HAILS NEW LAW TO PROTECT INTELLECTUAL PROPERTY

WASHINGTON, D.C. (October 15, 2008) – SEMA, the Specialty Equipment Market Association, applauded President Bush’s decision to sign into law legislation to strengthen intellectual property (IP) protections for American businesses and consumers.  Passage of the “Pro-IP Act” has been a top legislative priority for SEMA.  The new law increases civil and criminal penalties against counterfeiting and piracy, and establishes permanent programs in which the U.S. government works with industry and foreign governments to fight global piracy.

“Lawmakers have taken an important step in helping combat the scourge of counterfeiting,” said Chris Kersting, SEMA’s President and CEO.  “Our industry is all about innovation, technology, and quality.  Counterfeiters rob our companies of those valuable assets.  This provides the U.S. government with new tools and resources to fight intellectual property thieves.  Our industry owes a particular debt of gratitude to Sen. Evan Bayh (D-IN) and Sen. George Voinovich (R-OH) for their leadership in getting the legislation enacted into law.”

Enactment of the new law was the culmination of more than two years of work by SEMA and other industry groups fighting for stronger protection of U.S. copyrights, trademarks and patents.  One highlight of the law is the establishment of an IP czar who will coordinate all government anti-counterfeiting actions and report directly to the President.

Over the years, SEMA members have registered an increasing number of complaints about counterfeit products and illegal knock-offs.  Enactment of the law authorizes more federal enforcement officers and agents in the field dedicated to investigating counterfeiting claims.  Additional enforcement personnel will help track counterfeiters from the point of foreign production, through importation and distribution to store shelves.

Counterfeiters will face stiffer criminal penalties when they are apprehended, especially if the products potentially affect consumer safety.   The law does not change a basic requirement that businesses must first register their copyrights, trademarks and patents with the appropriate government authorities in order to establish enforceable legal rights.

Counterfeiting has had a large cost on the industry and the new law holds the potential to provide important relief.  “Since 1999, SEMA member Auto Meter has spent over two million dollars protecting itself against infringing imports,” said Auto Meter President Jeff King.

“Auto Meter applauds lawmakers for providing industry, federal courts and government agencies with more tools to address this problem.  Our company is fighting every day to protect American innovation, jobs and consumers, and share this investment in intellectual property with the rest of the world. Products continue to enter the U.S. market, and every year Auto Meter loses tens of thousands of dollars in sales to these illegal products.”

Summary of “Pro-IP Act”

PRO-IP Act is short for "Prioritizing Resources and Organization for Intellectual Property Act of 2008."  [S.3325, Public Law No: 110-403, Oct. 14, 2008]

Enactment of PRO-IP was the culmination of more than two years of work by SEMA and other industry groups fighting for stronger protection of U.S. copyrights, trademarks and patents.

Over the past several years SEMA members have registered an increasing number of complaints about counterfeit products and illegal knock-offs.  As the problem grew, our industry found there were not enough Federal law enforcement officials dedicated to the problem and civil and criminal penalties against counterfeiting were not strong enough.

PRO-IP essentially puts ‘more cops on the streets” to fight counterfeiters and gives law enforcement officers, the courts and right-holders stronger penalties to use against IP criminals.  It also makes permanent the Bush Administration’s Strategy Targeting Organized Piracy (STOP!) Initiative and its inter-agency IP coordination efforts which began in 2004.  It establishes the position of IP czar to coordinate all government anti-counterfeiting actions and report directly to the President.
 
Specifics in the law supported by SEMA include:

  • Treble Damages in Counterfeiting Cases: PRO-IP institutes treble damages not only for those who intentionally use a counterfeit mark, but also for those who knowingly supply goods or services necessary to the commission of a violation of the Trademark Act.
  • Statutory Damages in Counterfeiting Cases.  PRO-IP increases the statutory damages in trademark counterfeiting cases from a range of “$500 to $100,000” to “$1000 to $200,000” for use of a counterfeit mark, and from “$1,000,000” to “$2,000,000” for cases involving willful use of a counterfeit mark.
  • Transshipment and Exportation of Goods Bearing Infringing Marks.  Under PRO-IP importation or transshipment or exportation of goods with counterfeit trademarks will now constitute a violation of the Trademark Act and the Copyright Act.
  • Trafficking in Counterfeit Goods or Services.  PRO-IP provides enhanced maximum statutory penalties for counterfeiting offenses that endanger public health and safety.  It increases maximum penalties for offenses from 10 years imprisonment to 20 years where the defendant knowingly or recklessly causes serious bodily injury, and to life imprisonment where the defendant knowingly or recklessly causes or attempts to cause death.
  • Coordination and Strategic Planning of Federal Effort Against Counterfeiting and Piracy: Under PRO-IP the President, with the advice and consent of the Senate, shall appoint an Intellectual Property Enforcement Coordinator to serve in the Executive Office of the President.  This Coordinator will chair the interagency intellectual property enforcement advisory committee which includes senior representatives from federal departments and agencies involved in the enforcement of intellectual property rights and in combating counterfeiting and piracy.  The Coordinator to submit an annual report to the President and the Congress on the activities of the interagency intellectual property enforcement advisory committee and will disseminate that report to the public.  The law directs that appropriations of funds for the coordinator, staff and activities be carried out.
  • Local Law Enforcement Grants:  PRO-IP creates grants for training, prevention, enforcement and prosecution of Intellectual Property theft and infringement cases.  Grants may be used to assist state and local law enforcement agencies in enforcing IP related crimes.
  • Improved Investigative and Forensic Resources for Enforcement of Laws Related to Intellectual Property Crimes:  PRO-IP requires the Federal Bureau of Investigation to create an operational unit within the Bureau that consists of at least ten agents to work with the Department of Justice on intellectual property crimes.  This section also requires that any unit in the Department responsible for computer hacking or intellectual property crimes be assigned at least two FBI agents.
  • Additional Funding For Resources to Investigate and Prosecute Criminal Activity Involving Computers:  PRO-IP authorizes an additional $10 million for the Federal Bureau of Investigation, and the same amount for the Department of Justice, for each of the fiscal years 2009 through 2013, to hire and train additional agents and prosecutors to investigate and prosecute intellectual property crimes, and to procure tools of forensic science for assistance in those investigations and prosecutions.
  • International Intellectual Property Law Enforcement Coordinators: The Attorney General will send five “intellectual property law enforcement coordinators” to the countries or regions where their presence and assistance can have the greatest positive effect on US intellectual property rights and interests, within 180 days of enactment of this Act.  Those coordinators are charged with acting as liaisons to foreign law enforcement agencies and officials, performing outreach and training to build foreign countries’ enforcement capacities, and coordinating US enforcement efforts in those foreign countries.
  • Authorization of Appropriations.  Most importantly, the PRO-IP authorizes necessary appropriations for the actions mandated by this law.  (Lawmakers must still follow-through and appropriate the money – a separate action from authorization.)
  • Registration.   The law does not change a basic requirement that businesses must first register their copyrights, trademarks and patents with the appropriate government authorities in order to establish enforceable legal rights.

For more information, please contact Stuart Gosswein at stuartg@sema.org.


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