I 

108TH CONGRESS 

2D SESSION H. R. 4358

To amend title 18, United States Code, to provide criminal penalties for 

trafficking in counterfeit marks. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 13, 2004

Mr. KNOLLENBERG (for himself and Mr. GREEN of Wisconsin) introduced the 

following bill; which was referred to the Committee on the Judiciary 

A BILL

To amend title 18, United States Code, to provide criminal 

penalties for trafficking in counterfeit marks.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; FINDINGS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Stop Counterfeiting in Manufactured Goods Act’’. 

6 (b) FINDINGS.—The Congress finds that—

7 (1) the United States economy is losing millions 

8 of dollars in tax revenue and tens of thousands of 

9 jobs because of the manufacture, distribution, and 

10 sale of counterfeit goods; 
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1 (2) the International Chamber of Commerce es2 timates that seven percent of world trade is in coun3 terfeit manufactured goods, and the counterfeit mar4 ket is worth $350,000,000,000; 

5 (3) counterfeit automobile parts, including 

6 brake pads, cost the auto industry alone billions of 

7 dollars in lost sales each year; 

8 (4) counterfeit products have invaded numerous 

9 industries including those producing auto parts, elec10 trical appliances, medicines, tools, toys, office equip11 ment, clothing, and many other products; 

12 (5) ties have been established between counter13 feiting and terrorist organizations that use the sale 

14 of counterfeit goods to raise and launder money; 

15 (6) ongoing counterfeiting of manufactured 

16 goods poses a widespread threat to public health and 

17 safety; and 

18 (7) strong domestic criminal remedies against 

19 counterfeiting will permit the United States to seek 

20 stronger anticounterfeiting provisions in bilateral 

21 and international agreements with trading partners. 

22 SEC. 2. TRAFFICKING IN COUNTERFEIT MARKS. 

23 Section 2320 of title 18, United States Code, is 

24 amended as follows: 
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1 (1) Subsection (a) is amended by inserting after 

2 ‘‘such goods or services’’ the following: ‘‘or inten3 tionally traffics or attempts to traffic in counterfeit 

4 marks’’. 

5 (2) Subsection (b) is amended to read as fol6 lows: 

7 ‘‘(b)(1) Upon a determination by a preponderance of 

8 the evidence that any articles in the possession of a de9 fendant in a prosecution under this section bear or are 

10 counterfeit marks, the court shall order the forfeiture and 

11 destruction of such articles, regardless of the criminal cul12 pability of the defendant. 

13 ‘‘(2) The court, in imposing a sentence upon a person 

14 convicted of a violation of this section, or upon a person 

15 who pleads guilty or nolo contendre to a violation of this 

16 section, shall order, in addition to any other sentence im17 posed, that the person forfeit to the United States—

18 ‘‘(A) any property constituting or derived from 

19 any proceeds the person obtained, directly or indi20 rectly, as the result of such violation; and 

21 ‘‘(B) any of the person’s property used, or in22 tended to be used, in any manner or part, to com23 mit, facilitate, aid, or abet the commission of such 

24 violation, 
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1 if the court in its discretion so determines, taking into ac2 count the nature, scope, and proportionality of the use of 

3 the property in the offense. 

4 ‘‘(3) When a person is convicted of a violation of this 

5 section, or pleads guilty or nolo contendre to a violation 

6 of this section, the court, pursuant to sections 3556, 

7 3663A(c)(1)(A)(ii), and 3664, shall order the person to 

8 pay restitution to the owner of the mark and any other 

9 victim of the offense. 

10 ‘‘(4) The term ‘victim’, as used in paragraph (3), 

11 shall have the meaning given that term in section 

12 3663A(a)(2).’’. 

13 (3) Subsection (e)(1) is amended—

14 (A) in subparagraph (A)(iii), by striking 

15 ‘‘or’’ after the semicolon; and 

16 (B) by inserting after subparagraph (B) 

17 the following: 

18 ‘‘(C) a spurious mark—

19 ‘‘(i) that is identical with, or substan20 tially indistinguishable from, a mark reg21 istered on the principal register in the 

22 United States Patent and Trademark Of23 fice under section 1 of the Lanham Act 

24 and in use, whether or not the defendant 

25 knew such mark was so registered; and 
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1 ‘‘(ii) that is applied to or consists of 

2 a label, patch, sticker, wrapper, badge, em3 blem, medallion, charm, box, container, 

4 can, case, hangtag, documentation, or 

5 packaging of any type or nature that is de6 signed to be affixed to, distributed with, 

7 consist of, or otherwise accompany goods 

8 or services; or 

9 ‘‘(D) a spurious mark—

10 ‘‘(i) that is used in connection with 

11 the trafficking of goods or services; and 

12 ‘‘(ii) that is identical with, or substan13 tially indistinguishable from, a famous 

14 mark that is registered on the principal 

15 register in the United States Patent and 

16 Trademark Office under section 1 of the 

17 Lanham Act and in use, regardless of the 

18 goods or services or class of goods or serv19 ices for which the famous mark is reg20 istered, and regardless of whether or not 

21 the defendant knew such mark was so reg22 istered and famous;’’. 

23 (4) Section 2320 is further amended—

24 (A) by redesignating subsection (f) as sub25 section (g); and 
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1 (B) by inserting after subsection (e) the 

2 following: 

3 ‘‘(f)(1) In determining whether a particular mark is 

4 a ‘famous mark’ under this section, the court may con5 sider information, data, testimony, and documentation re6 garding factors such as, but not limited to—

7 ‘‘(A) the degree of inherent or acquired distinc8 tiveness of the mark; 

9 ‘‘(B) the duration and extent of use of the 

10 mark; 

11 ‘‘(C) the duration and extent of advertising and 

12 publicity of the mark; 

13 ‘‘(D) the geographical extent of the trading 

14 area in which the mark is used; 

15 ‘‘(E) the channels of trade in which the mark 

16 is used; 

17 ‘‘(F) the degree of general public recognition of 

18 the mark; 

19 ‘‘(G) the nature and extent of use of the same 

20 or similar marks by third parties; 

21 ‘‘(H) survey evidence; and 

22 ‘‘(I) the record of successful criminal, civil, or 

23 administrative enforcement of rights in the mark, in24 cluding, in particular, the extent to which the mark 
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1 has been recognized as being famous by Federal or 

2 State courts or administrative authorities. 

3 ‘‘(2) In order to qualify as a famous mark under this 

4 section, the mark must be registered on the principal reg5 ister of the United States Patent and Trademark Office 

6 under section 1 of the Lanham Act. 

7 ‘‘(3) The United States shall bear both the burden 

8 of proof and persuasion with respect to the determination 

9 of whether a particular mark is a famous mark under this 

10 section. Evidence, in the form of a certified copy of a pub11 lished court or administrative opinion, of a prior deter12 mination, on the merits, by a Federal or State court or 

13 administrative authority, holding that a particular mark 

14 is a famous mark (regardless of whether the proceedings 

15 leading to the determination were civil, criminal, or admin16 istrative in nature), shall create a rebuttable presumption 

17 that the mark in question is a famous mark. 

18 ‘‘(4) A person may not be prosecuted under this sec19 tion by virtue of a mark that is a counterfeit mark if the 

20 person has, or is the agent or employee of a legal entity 

21 that has, lawfully registered that mark on the principal 

22 register of the United States Patent and Trademark Of23 fice under section 1 of the Lanham Act and that registra24 tion is valid at the time of the alleged offense.’’.

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