There were specific findings of fact that consumers were confused as to the qualities of the products and had complained to the U.S. producer. The court rejected that argument and the further argument that the burden on the Customs Service in making determinations as to the amount of consumer confusion was too onerous. In response to the injunction, the Customs Service appears to have taken the advice of the trial and appeals courts quite literally. Once the Customs Service has decided to impose the labeling requirement on the importer at the request of the U.S. trademark owner, the application is published in the Federal Register and interested parties are allowed to comment. First is the phenomenon of global brands.
Firms seek both to tailor their products to local interests and to benefit from global advertising.
At the same time, firms also seek to build local goodwill in foreign markets by licensing their global marks to independent local distributors, and to exploit markets where their products may command lower prices. Local goodwill and local distribution of global brands also reduces the prevalence of counterfeit goods in developing markets. The local distributor may discover and bring instances of counterfeiting to the attention of enforcement authorities more easily than a foreign trademark owner. Laws should encourage global brand owners to establish independent local distributors without the specter of having such entrepreneurs compete in other markets with the brand owner itself or other local distributors. The rule also serves to allow manufacturers to reflect varying notions of product liability in the price of their goods.