Tariff Act Does Not Require That Mark Owner Make The Product In Question

The U.S. Court of Appeals for the Ninth Circuit has ruled that a company that imports a product bearing a counterfeit mark can be liable for penalties under federal law (the Tariff Act) even if the owner of the mark in question does not make the product in question. United States of America v. Able Time, Inc., Case No. 06-56033 (9th Cir., Sept. 25, 2008) (Clifton, J.).

Able Time imported a shipment of watches into the U.S. bearing the mark TOMMY, a registered trademark owned by Tommy Hilfiger Licensing. U.S. Customs officials seized the watches pursuant to the Tariff Act, which authorizes seizure of any "merchandise bearing a counterfeit mark" under 19 U.S.C. § 1526(e). Tommy Hilfiger did not make or sell watches at the time of the seizure. U.S. Customs later imposed a civil penalty upon Able Time pursuant to § 1526(f) of the Tariff Act, which authorizes the imposition of a fine upon any person who imports merchandise that is seized. The district court concluded that,