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Who Cares About the Counterfeiters? How the Fight Against Counterfeiting Has Become an In REM Process

60 Pages Posted: 1 Mar 2010 Last revised: 25 Mar 2010

Steven N. Baker

affiliation not provided to SSRN

Date Written: February 24, 2010


Counterfeiters cost trademark owners and the United States government billions of dollars in lost revenue. In an effort to staunch the flow of counterfeit goods, Congress passed the Trademark Counterfeiting Act of 1984. The Act’s mandate, as reflected in the statute itself and extensive legislative history, was to make it easier for trademark owners to obtain treble damages from counterfeit operations. Trademark owners’ biggest problem was spoliation - counterfeiters were destroying all the evidence. Thus, the Act provided for a limited, ex parte seizure order that would allow trademark owners to seize and protect the evidence of wrongdoing.

Twenty-five years later, it is clear that the seizure process has evolved beyond its origins. Trademark owners obtain a seizure order, seize thousands of goods worth millions of dollars for months - sometimes years - and then destroy those goods. Nowhere is this process more clear than with the National Association for Stock Car Auto Racing, or NASCAR, which this Article uses as an exemplar. The modern process of indefinite seizure and destruction of property bears little resemblance to the evidence-gathering device Congress created. Instead, the process looks like its own substantive remedy: the seizure and forfeiture of counterfeit items, not to preserve evidence for trial, but to remove the items from the marketplace. Thus, the focus of a counterfeiting action has shifted. The counterfeiters, and any potential monetary damages against them, have become irrelevant; only the seizure and destruction of the counterfeit property interests trademark owners. Seizure and forfeiture of a thing for the sake of that thing itself has an age-old definition: an in rem action.

In this Article, we posit that the modern counterfeiting action has, in all but name, become an in rem action. Trademark owners and courts, however, continue to handle counterfeiting cases with only in personam procedures. The implications of this disconnect are myriad. In particular, the kinds of seizure and destruction orders routinely issued almost certainly violate the Due Process Clause and the Fourth Amendment. The solution to this dilemma is to call the modern counterfeiting action what it is - an in rem action, concerned only with the counterfeit goods - and to act accordingly by putting the proper procedures into place.

Keywords: trademark, counterfeit, bootleg, Trademark Counterfeiting Act, Lanham Act, seizure order, seizures, seize, in rem, in personam, forfeiture, NASCAR, National Association for Stock Car Auto Racing, due process, fourth amendment, supplemental rules, ex parte, taint, destruction, notice

Suggested Citation

Baker, Steven N., Who Cares About the Counterfeiters? How the Fight Against Counterfeiting Has Become an In REM Process (February 24, 2010). St. John's Law Review , Vol. 83, p. 735. Available at SSRN:

Steven N. Baker (Contact Author)

affiliation not provided to SSRN

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