U.S. Customs and Border Protection Seize Over 6 Million Counterfeit Cigarettes.

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In mid March of 2018, U.S. Customs and Border Protection (CBP) officers along with U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) commercial fraud agents seized six million counterfeit cigarettes during a warehouse inspection.

The estimated retail price is $1.1 million. CBP import specialists with the Agriculture and Prepared Products Center of Excellence and Expertise (CEE) in Miami reviewed 600 boxes of counterfeit cigarettes and found multiple trade name protection and trafficking counterfeit goods violations.

CBP cites many dangers to these counterfeit cigarettes – first criminal organizations profit from the sale of counterfeit goods and second, counterfeit cigarettes pose a greater public health risk. CBP also indicates that trademark owners are also hurt and the government also is deprived of tax revenue.

If you or someone you know has had counterfeit cigarettes or any other goods seized by Customs for suspected IP violations or trademark violations – contact experienced Customs attorney David Hsu. Customs holds importers liable for both civil penalties and criminal prosecution. Call 832-896-6288 or e-mail dhsu@givensjohnston.com for immediate assistance.

Customs and Border Protection’s 2018 E-Commerce Strategy.

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According to a U.S. Customs and Border Protection (CBP) media release on March 8th, 2018 – CBP released their new strategy to deal with the increase in volume of e-commerce packages into the United States.

The media release is wordy and you are already to go back to Facebook – so here’s a quick cliff notes version of the media release:

1. More people are using the internet to buy direct from China, leading to more small packages entering the US.

2. The large increase in volume of small packages (commonly indicated as “e-packet delivery”) means there is a greater likelihood of things entering the country that should not enter.

3. CBP is worried about a greater entry of items that violate intellectual property rights (fake watches, counterfeit purfume, fake iphones, etc) will make it into the US.

Some highlights of the CBP e-commerce strategy:

1. Educate people to be aware of customs regulations. Not sure how easy it will be to make people aware of customs regulations when people can’t even follow traffic regulations!

2. Partnership with foreign governments

3. Improve data collection from CBP targeting systems and field personnel.

4. The media release includes a lot of buzzwords: “more agile, dynamic workforce that utilizes state-of-art techniques and technology to better target high-risk shipments, improving data collection from CBP targeting systems, and leveraging enforcement partnerships.”

My thoughts:

Personally, I do not believe methods 1-4 will be able to adequately address the increased flow of these small packages from China. I believe CBP has other methods that they are not publicizing, and rightly so. Notifying the public how CBP searches for items that violate IPR, are counterfeit or not allowed for entry into the US would be counter-intuitive and could only lead to foreign manufacturers creating work arounds.

If you are a manufacturer overseas and ship many small package items to the US and want to know how this can effect your business, call experienced trade and customs attorney, David Hsu, 832.896.6288 or email at dhsu@givensjohnston.com

Record Number of Intellectual Property Rights Seizures by Customs in 2017.

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U.S. Customs and Border Protection (“CBP”) and U.S. Immigration and Customs Enforcement (“ICE”) released a report indicating they seized a record number of 34,143 shipments of goods that violated Intellectual Property Rights (“IPR”) in 2017. In comparison, 2016 saw about 30,000 shipments seized for counterfeit and pirated products. The total estimated MSRP of the seized goods in 2017 total approximately $1.2 billion.

Other interesting facts in the report:

-90% of the seized counterfeit and pirated goods in 2017 were in express carrier and international mail environments as opposed to containerized shipments.

-15% of the IPR seizures were related to wearing apparel

-48% of the IPR violation seizures were from China (16,538)

-39% of the IPR violation seizures were from Hong Kong

We can expect CBP and ICE to only increase their number of seizures for 2018 as CBP continues with their “The Truth Behind Counterfeits campaign” along with increased awareness of the CBP hotlines to report suspected fraud or illegal trade activity (1-800-BE-ALERT).

If you or anyone you know has had CBP or ICE detain your shipments, or if you received notice from DHL of a Customs seizure – call experienced trade and customs attorney David Hsu at 832.896.6288, or email dhsu@givensjohnston.com.

Many importers do not contest the seizure because they feel the value of the shipment doesn’t justify speaking to an attorney – but CBP can and will issue civil penalties after the seizure, call today!

 

$233,000 Worth of Counterfeit Watches Seized by Customs.

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According to a U.S. Customs and Border Protection (CBP) media release on March 1st; CBP officers in Philadelphia seized 54 counterfeit designer brand watches.

CBP officers examined the parcel on January 23rd that was shipped from Hong Kong. The packing list indicated the shipment as containing “watch samples” and upon further inspection, CBP found watches bearing name brands such as Armani, Hublot, Omega,
Rado, Rolex and others. If authentic, the MSRP for the watches totaled $233,209.

As you may or may not know, CBP is tasked with enforcing the intellectual property laws of companies who register their brand with Customs. In this instance, CBP officers with the Consumer Products and Mass Merchandising Centers for Excellence and Expertise (CEE) inspected the watches, worked with the trademark holders and confirmed the watches were counterfeit.

Some of the tell-tale signs of counterfeit watches include but are not limited to: poor quality packaging of the watch, watch construction (weight, dial movement) and the origin of shipment (from Hong Kong).

CBP frequently seizes counterfeit goods and on a typical day in 2017, CBP seized $3.3 million worth of products for intellectual property rights violations.

If you or someone you know has had your import seized due to counterfeit or trademark violations, contact experienced Customs attorney, David Hsu. Customs can penalize importers civil and criminal penalties, and time there are certain time limitations – call  832.896.6288 or email at dhsu@givensjohnston.com today.

What is the Customs and Border Protection “Donations Acceptance Program”?

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Short answer – a change to the Homeland Security Act of 2002 allowed CBP and the US General Services Administration to accept real and personal property, money and non-personal services from the private and public sectors. Accepted donations may be used for port of entry construction, alternations, operations and maintenance activities.

According to a February 15, 2018 Customs media release, Proctor and Gamble (P&G) will donate testing devices to CBP officers and trade specialists to assist in determining the legitimacy of the P&G product in an attempt to reduce counterfeit goods entering the US marketplace.

The media release did not specify the type of testing device; however, the testing devices may be related to a 2014 patent filed by P&G for a chemical test kit to test for the presence of active components and qualities of the product that may be missing from counterfeits.

The DAP from P&G may be related to last year’s counterfeit Tide laundry detergent being sold in Austin, Texas at a price far below retail value. The low cost of the product and packaging written in Vietnamese may have been indications of the counterfeit nature of the Tide detergent.

If your imported P&G products have been seized by Customs, contact your experienced customs seizure attorney, David Hsu at 832-896-6288 or by email at dhsu@givensjohnston.com.

CBP seizes fake perfume valued over $31 million.

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In the past few months, U.S. Customs and Border Protection (CBP) officers and import specialists in the seaport at Los Angeles have seized over 475,000 bottles of imported perfume bearing counterfeit trademarks. While the cost of the counterfeit perfumes may be low, if genuine, CBP estimates the MSRP of the seized perfumes to retail over $31 million.

CBP’s fiscal year starts October 1, 2017 and since then, CBP officials in Los Angeles have seized 11 shipments with suspected counterfeit marks along with confusingly similar fragrances. As you are aware, CBP enforces the trademarks for companies registered with CBP. The seizues included violations of trademarks belonging to over 34 perfume brands.

According to the CBP news release, the “counterfeit brands included Giorgio Armani, Burberry, Calvin Klein, Chanel, Coach, Dior, Dolce & Gabbana, Gucci, Guess, Hugo Boss, Lacoste, Michael Kors, Ralph Lauren, Versace, Victoria Secret, and Perry Ellis among others.”

As a general rule, if you purchase perfume at prices “too good to be true”, it is likely the item is counterfeit. The news release indicates the counterfeit perfumes were packaged in boxes and colors resembling the genuine items with fake country of origin markings (“Made in France”) even though the port of origin was China.

CBP is especially vigilent in seizing suspected counterfeit perfumes as these items are placed on the skin and absorbed by the body – counterfeit perfumes may be composed of chemicals harmful to the body and may be made and sold without any product testing.

In FY 2016, CBP seized over $1.4 billion worth of counterfeit goods – if you have had your imports seized and want to speak to an experienced attorney, call David Hsu at 832-896-6288 or email at dhsu@givensjohnston.com for immediate assistance.

What is a Customs “Notice of Seizure and Intent to Forfeit (CAFRA)”?

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After your property is seized at an airport, border crossing or any of the other 400 ports of entry into the United States, the U.S. Department of Homeland Security (DHS), U.S. Customs and Border Protection (CBP) will send you a “Notice of Seizure and Intent to Forfeit (CAFRA)” by certified mail, return receipt requested to the address you provided to CBP at the time of the seizure.

DHS and CBP are required by law to send you the notice under 19 USC 1607 and 19 CFR 162.45. The notice tells you that DHS has seized the items and will intend to “forfeit and sell, or otherwise dispose of according to law”. The final disposition of your seized property ultimately depends on the item seized.

If you do not receive a notice by mail, you can still file a claim within 30 days from the date of the publication of the CBP “Official Notification” posted on the forfeiture.gov website.

If you have had currency, suspected trademarked goods, or any other property seized by Customs, call David Hsu, an experienced customs and trade law attorney who works for you to get your hard earned property and money back. Call or email anytime, 832-896-6288, dhsu@givensjohnston.com.

 

Importing Refurbished Cell Phones and Customs Seizures.

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Today’s blog post is in response to our firm seeing an increase in the number of importers having their Samsung or Apple phones seized by Customs.

Typically, our client is a company in the United States that purchases used Apple iPhones or Samsung Galaxy phones from the US. The used phones vary anywhere from A to C stock and may have broken screens, defective home buttons, scratched, dented or damaged housing or cracked camera lens. Some phones are store demos with burn-in on the screens, customer returns or old, new stock. The phones are packaged and then sent to China for repair and refurbishing. The fixed phones are then sent back to the US for sale through wholesalers and distributors.

However, as the phones are shipped back to the company in the US, U.S. Customs and Border Protection (CBP) detains shipments to review whether or not the cell phones violate any intellectual property rights (IPR).

CBP will first detain the phones and has 30-days to speak to the trademark or IPR holder to determine the authenticity of the trademark or IPR. The trademark could be the “Samsung” logo, the “Apple” logo or even the “iPhone” trademark printed in text on the back of the phones. More often than not, the shipped phones change from being “detained” to being “seized”.

The majority of the seizures are due to trademarks found on the rear housing of the phones. As most importers cannot provide authorization by the trademark or IPR holder the right to use the mark, CBP considers the importer phones to be counterfeit and are then subsequently seized.

If you have had your refurbished iPhone or Samsung phone seized by Customs, call experienced cell phone seizure attorney David Hsu at 832.896.6288 or by email at dhsu@givensjohnston.com. There are certain time limitations after a seizure has occurred so contact David Hsu today.

Baltimore CBP Seizes $1 Million in Counterfeit Stainless Steel Sinks.

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On Wednesday, January 17th, U.S. Customs and Border Protection (CBP) in Baltimore seized over 2,900 stainless sinks for displaying a counterfeit UPC shield design on the 17th.

CBP initially detained the shipment for anti-dumping and countervailing duties enforcement and during their examination found the UPC shield logo. In addition to looking for shipments subject to ADD/CVD duties, CBP also enforces the intellectual property rights of trademark holders, among others.

CBP and Intellectual Property Rights (IPR) specialists sent the UPC shield logo to the registered trademark holder, the International Association of Plumbing and Mechanical Officials, the registered trademark holder, who determined the use of the logo to be unauthorized.

As the marks were unauthorized, CBP seized the entire shipment for containing markings without trademark holder’s authorization (19 CFR 133.21).

The full release can be found here: https://www.cbp.gov/newsroom/local-media-release/baltimore-cbp-seizes-1m-counterfeit-stainless-steel-sinks

If you or anyone you know has had any property seized by customs for suspected intellectual property rights violations, please contact your trade and customs law attorney, David Hsu at 832.896.6288 or dhsu@givensjohnston.com.

What happens when U.S. Customs seizes your items?

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We are often asked what happens after U.S. Customs and Border Protection (“Customs”) seizes your merchandise. While there are many different scenarios and factors that influence the client’s specific seizure case, here’s our effort to summarize what typically happens.

At all the ports of entries into the U.S., Customs will stop, examine, search, detain and or seize merchandise from persons entering or leaving the U.S. or merchandise being being exported or imported to and from the U.S.

Customs officers are entrusted to enforce the hundreds of laws for the over 40 government agencies, such as the U.S. Fish and Wildlife Service, U.S. Department of Agriculture and the U.S. Food and Drug Administration (“FDA”). Customs’ job is to assist these agencies in ensuring unsafe and prohibited items are not allowed to enter the U.S.

A typical Customs officer may search for items such as counterfeit merchandise, illegal drugs, food or drugs not approved by the FDA or items from a country in which the U.S. has an embargo. The list of prohibited items is exhaustive and our clients are often surprised their items were seized.

Items and merchandise held by Customs are sent to a Centralized Examination Station (“CES”) to “maintain control and accountability of merchandise imported into the United States” (U.S. Customs and Border Protection, CBP Directive No. 3270-007A). Customs has 35 days from the time of arrival of the items in the U.S. to detain the items for examination. At this time, Customs will also notify the importer, customs broker or attorney with an explanation for the detention.

After 35 days has passed, the cargo must be seized or released. However, as previously mentioned, the amount of various government agencies involved and associated bureaucracy may cause a delay of 60 days or more.

If it is determined that a violation did occur, the merchandise will be seized by Customs and then transported to a Seized Property warehouse. Once the items arrive at the warehouse, it will remain there until it is authorized to be released by Customs. The paperwork regarding the seized items will then be sent to a Customs Fines, Penalties, and Forfeitures Office (FP&F). At the FP&F, a paralegal reviews the file, prepares a written Seizure Notice and mails the notice to the party responsible for the items.

The Seizure Notice identifies when and where the cargo was seized along with the basis for the seizure.

It is important to seek immediate assistance when you receive a Seizure Notice as Customs only allows 30 days to Petition Customs for the release of the seized items. A Petition is a written explanation to persuade Customs to release the seized items. Not timely filing a Petition may result in the seized items being destroyed or disposed of.

Customs may grant the petition and release the items or Customs may deny the petition. In the event the petition is denied, you have the option to file a Supplemental Petition or Offer in Compromise.

As each seizure case is different, contact me at dhsu@givensjohnston.com to discuss your specific case at no charge.