New U.S. Law Gives Trademark Owners Stronger Weapons against Counterfeits

On March 16, 2006, President Bush signed into law a bill that will provide criminal penalties for trafficking in counterfeit goods. Known as the “Stop Counterfeiting in Manufactured Goods Act,” the law mandates the destruction of counterfeit goods and the forfeiture of any assets that can be traced to illegal counterfeit activities. It also requires mandatory restitution to the trademark owner by the counterfeiter. The new law outlaws any distribution of counterfeits, or possession with the intent to distribute counterfeits, with the expectation of gaining something of value. The law is well timed. According to the Coalition Against Counterfeiting and Piracy (CACP), a U.S. based anti-counterfeiting interest group, counterfeiting currently costs the United States around $200 billion annually. The recently passed law will help trademark owners more aggressively defend their marks against counterfeits, which not only hurt the value of the trademarks, but can threaten the health and safety of consumers.