According to a South China Morning Post article, Hong Kong Customs officials investigated and ultimately raided a cell phone repair shop after receiving complaints from a trademark holder (not specified whether Apple or Samsung complained).
The article claimed the repair shop refurbished devices for clients in the US, UK and Australia that sent second-hand phones for repair at 1/3 the typical rate of an authorized repair facility. The repairs typically included replacing the screen or housing.
HK Customs officials claimed the repair shop used counterfeit parts to repair damaged iPhones, and seized over $120,000 worth of fake goods.
Based on the article, I’m pretty sure Apple complained about the IP violations since most Samsung phones do not have the housing replaced when being refurbished. While not listed in the article, the IP violations probably were for the wordmark “iPhone” or the trademark Apple logo found on the back housing. The iPhone replacement glass do not have any IP marks, so the seized goods were most likely the housings.
I get asked this question a lot – and the answer is yes you can. However, cell phones are frequently detained and seized by Customs.
Why are imported refurbished phones detained or seized?
Customs enforces the intellectual property and trademarks of any manufacturer or holder of intellectual property. Apple and Samsung have filed their trademarks and word marks with Customs and CBP may seize your phones (and batteries if they are branded Samsung).
I thought there was an exception for counterfeit goods?
I previously posted on my blog about the counterfeit exception for 1 item. However, that exception only applies if it is carried on you, it will not apply if the counterfeit item is sent by mail.
But my goods are genuine iPhones, why are they still seized?
When suspected counterfeit goods are seized – CBP will take a photo and send to Apple, Samsung (or other property rights holder). The trademark holder will more likely than not tell CBP the phone is counterfeit. From my experience, I have never had any trademark holder agree that the phone is authentic.
How do I know if my cell phone shipment is seized?
Customs will send you a Notice of Seizure signed by the Fines, Penalties and Forfeiture officer of the port where your phones were seized. You have 30 days from the day of the letter to respond. Please note the 30 days is not from the day you receive the notice.
What if I don’t respond to the seizure notice?
If you do nothing, then the goods will be forfeited after the response date. Forfeited means destroyed. Customs may then issue you a civil penalty based on the value of the phones. The value will be retail and not reflect what you paid wholesale or your actual cost. The valuation of the shipment is important because that value is used to determine civil penalties.
I have more questions!
Call David Hsu at 832-896-6288 or by email at email@example.com. There are some things we can do and time is of the essence – call now, no cost or obligation.
According to a U.S. Customs and Border Protection (CBP) media release, officers at the Pembina officers seize counterfeit iPhones at the Pembina Port of Entry in North Dakota.
The iPhones were seized for being in violation of intellectual property rights (IPR) regulations. The shipment contained 39 cell phones with the Apple trademark and have a retail price of $31,200.
The rest of the media release talks about CBP enforcing intellectual property, how counterfeit goods funds criminal activity, and counterfeit goods may be made out of materials that are harmful to the health and safety of the users..
The article didn’t go into detail, but here are a few other things you should know from my handling of iPhone seizures:
- Usually the violation is for a counterfeit use of the iPhone wordmark or the Apple logo. The “Notice of Seizure” will tell you what was violated. You have to read this carefully and must respond within 30 days to a notice of seizure.
- You will also get a letter from Apple’s law firm asking you to stop importing iPhone goods.
- Be sure your address is current and accurate with CBP, they will only mail notices to the address on the shipment.
- If you get a Seizure Notice, you have 4 options: file a petition, offer in compromise, abandon the goods or refer to court.
- The value of the iPhones given by CBP will be much higher than you paid, as I believe they value the goods at the MSRP at the time they are first released.
- Why does the value matter? The value of the goods will be used to calculate any penalties. For example, civil penalties may be 3x the value of the shipment.
- CBP and Customs problems don’t go away – CBP has 5 years to go after an importer. CBP isn’t going away and neither will your seizure.
If you have had your shipment of iPhones seized, contact me. I’ve represented many cell phone importers of iPhones, Samsung and their accessories and there are things we can do but time is of the essence.
Contact me at 832-896-6288 or by email at firstname.lastname@example.org.
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 email@example.com. There are certain time limitations after a seizure has occurred so contact David Hsu today.