We are pleased to present the second installment in a multipart series designed to help right holders and importers better understand the opportunities and obligations that attach to intellectual property rights (IPR) in the U.S. Customs regulatory environment. The focus of this installment is on copyrights. Owing to the diversity of considerations wrapped up in the management of copyrights in international trade, the topic will be addressed in two parts. The first part, set forth below, lays a foundation by addressing the copyright infringement levels recognized by U.S. Customs and Border Protection and their attendant enforcement regimes. The second part will complete the copyrights-trade picture by discussing enforcement relief options and presenting best practice tips for both right holders and importers.
Introduction
Copyrights protect original works of authorship against unauthorized copying. Original works of authorship include literary, dramatic, musical, artistic, pictorial, graphic, sculptural, and architectural works, motion pictures and other audio visual works, and sound recordings. In the U.S., copyright protection attaches the moment a work is fixed in any tangible medium of expression. Ideas not anchored in a tangible medium of expression are ineligible to receive copyright protection. Once established and while valid, copyrights insulate right holders against the unlawful copying of a protected work in any medium. For individuals, copyright protection runs for the life of the author plus 70 years. Made for hire or anonymous works are, on the other hand, entitled to a term of copyright protection that lasts 95 years from first publication or 120 years from the date of creation, whichever expires first. Upon the expiration of a copyright’s term of protection, the work enters the “public domain” and may be freely used by anyone.
Copyright piracy – i.e., the unauthorized and unlawful copying of a protected work – is a significant problem the world over. It is, on a commercial enterprise scale, dominated by organized crime syndicates, though terrorist groups have also been known to engage in piracy as a means of raising funds. While syndicate networks span the globe, the lion’s share of their copyright piracy activity is centered in China, Southeast Asia, and Russia. On a more pedestrian level, the widespread availability of devices, apps, and platforms for making, procuring, or distributing unauthorized copies of protected works makes it possible for almost anybody, with only the slightest bit of effort, to engage in or unwittingly facilitate copyright piracy. These dynamics are problematic in that they can deprive right holders of the fruits of their labor, discourage creativity, hinder the realization of derivative works, destroy jobs, increase production and distribution costs, create cybersecurity risks, and undermine national security.
Infringement Levels and Enforcement Actions
The above described reality, considered in conjunction with the fact that copyright piracy frequently involves the movement of merchandise through legitimate import-export channels, has resulted in U.S. Customs and Border Protection (CBP) making copyright protection and enforcement a “Priority Trade Issue.” To this end, CBP, working in concert with the National Intellectual Property Rights Coordination Center, uses a combination of recordation tools, interagency risk assessment techniques, e-allegations, whistleblower reports, audits, public-private collaborative operations, and data analytics to reduce the flow of piratical articles. The focus of these efforts centers on the following two forms of copyright infringement:
Clearly Piratical
The first form of copyright infringement recognized by CBP involves works that are “clearly piratical.” Clearly piratical copies are, per Customs Directives, those for which there exists an overwhelming and substantial similarity between the copyrighted elements of the protected work and an imported item. These similarities are clear cut and leave no doubt that one work was based on the other. Determinations as to what constitutes a clearly piratical article may be based on the comparative characteristics of the protected and imported items, CBP rulings, or, in certain cases, the decisions of U.S. courts.
Clearly piratical copies of works which are registered with the U.S. Copyright Office (USCO) and recorded with CBP are subject to detention, seizure, and forfeiture (with subsequent notice to the copyright holder). A diminished degree of enforcement certainty attaches, by way of contrast, to works which are USCO-registered but not recorded with CBP. While clearly piratical copies that violate 17 USC 506 will, regardless of the underlying work’s recordation status with CBP, be subject to seizure and forfeiture, CBP’s willingness to undertake enforcement measures against clearly piratical works in other contexts will be a function of whether the agency thinks such action is administratively feasible and appropriate. The superior level of enforcement provided in support of recorded works underscores the benefit of recording USCO registered copyrights with CBP.
Possibly Piratical
The second form of copyright infringement recognized by CBP focuses on works which are “possibly piratical.” Merchandise will, in this connection, be deemed possibly piratical if CBP forms a “reasonable suspicion” that imported articles are violative of a recorded copyright.
Owing to CBP’s lack of certainty in this circumstance, possibly piratical merchandise is detained in a way that provides potentially interested parties an opportunity to assert and defend their interests. Importers who engage and are able to demonstrate the absence of infringement will have their goods released by CBP. Importers who are unable to demonstrate the non-infringing nature of the works they are attempting to enter may, alternatively, have their goods seized and made subject to forfeiture by CBP.
Contrary to the foregoing, CBP does not take enforcement action against possibly piratical copies of an unrecorded work. Notwithstanding this fact, right holders who do not go through the administrative recordation process always have the option of protecting their copyrighted works pursuant to the obtainment of a court-ordered injunction that CBP will, in turn, enforce against possibly piratical merchandise. As was the case, above, the fundamental take away is that recording provides right holders with a significantly enhanced quality of protection against copyright piracy.