Opinion ID: 3053402
Heading Depth: 4
Heading Rank: 2

Heading: Sequence of Statutory Enactments

Text: Congress has shown more than once that it is able to impose an identity of goods or services requirement when it wishes by saying so explicitly in the relevant statutory text. Congress enacted the definition of “counterfeit” in 15 U.S.C. § 1127, at issue here and discussed above, in the Lanham Act in 1946. Congress created the seizure and forfeiture provision of the Tariff Act, 19 U.S.C. § 1526(e), also discussed above, in the Customs Procedural Reform and Simplification Act of 1978 (the “1978 Act”), Pub. L. No. 95-410, 92 Stat 888. Congress created criminal and civil provisions that contain an explicit identity of goods or services requirement in the Trademark Counterfeiting Act of 1984 (the “1984 Act”), ch. XV, §§ 1501-03, Pub. L. No. 98-473, H. R. J. Res. 648 (1984), 98 Stat. 2178.3 The 1984 Act also amended portions 3 The criminal provision of the 1984 Act penalizes “[w]hoever intentionally traffics or attempts to traffic in goods or services and knowingly uses a counterfeit mark on or in connection with such goods or services.” 98 Stat. 2178 (1984) (codified at 18 U.S.C. § 2320(a) (2008)) (emphasis added). The criminal provision originally defined “counterfeit mark” as “a spurious mark . . . used in connection with trafficking in goods or services . . . that is identical with, or substantially indistinguishable from, a mark registered for those goods or services . . . .” 98 Stat. 2178, 2179 (1984) (codified at 18 U.S.C. § 2320(d)(1)(A) (2006)) (emphasis added). The civil provision created by the 1984 Act defines a “counterfeit mark” as a “counterfeit of a mark that is registered . . . for such goods or services sold, offered for sale, or distributed and that is in use.” 98 Stat. 2178, 2180 (1984) (codified at 15 U.S.C. § 1116(d)(1)(B)(i) (2008)) (emphasis added). UNITED STATES v. ABLE TIME, INC. 13667 of the Lanham Act, but it did not alter the definition of “counterfeit” in 15 U.S.C. § 1127, nor did it add an identity of goods or services requirement to the seizure and forfeiture provision, 19 U.S.C. § 1526(e). Congress created the civil penalty provision of the Tariff Act discussed above, 19 U.S.C. § 1526(f), in 1996 as part of the Anticounterfeiting Consumer Protection Act (“ACPA”), Pub. L. No. 104-153, 110 Stat. 1386. In 2006, Congress amended the language in the criminal provision’s definition of “counterfeit mark” to make the identity of goods or services requirement even clearer.4 Once again, it did not change the definition of “counterfeit” in 15 U.S.C. § 1127, nor did it add an identity of goods or services requirement to the provisions of Tariff Act at issue here, 19 U.S.C. § 1526(e) and (f). [9] That Congress included an explicit identity of goods or services requirement in both the civil and criminal provisions of the 1984 Act, amended the Lanham Act in 1984, amended the Tariff Act in 1996, and then clarified the requirement in the criminal provision of the 1984 Act in 2006, but never added such a requirement to the provisions of the Tariff Act and Lanham Act at issue here, supports the inference that the omission of such a requirement from those provisions was intentional. See Beach v. Ocwen Fed. Bank, 523 U.S. 410, 418 (1998) (“[W]here Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion.”) (internal quotation and citations omitted). Congress 4 As amended by the Stop Counterfeiting in Manufactured Goods Act, the criminal provision of the 1984 Act now defines a “counterfeit mark” as “a spurious mark . . . used in connection with trafficking in any goods [or] services . . . that is identical with, or substantially indistinguishable from, a mark registered . . . and in use . . . that is applied to or used in connection with the goods or services for which the mark is registered.” Pub. L. No. 109-181, 120 Stat. 285, 286-87 (2006) (codified at 18 U.S.C. § 2320(e)(1)(A) (2008)) (emphasis added). 13668 UNITED STATES v. ABLE TIME, INC. may have wanted to apply a more restrictive definition in the context of criminal suits and civil actions by self-interested private plaintiffs than in penalty suits brought by the government. Whatever its reasons, Congress simply did not include an identity of goods or services requirement in the definition of “counterfeit” contained in 15 U.S.C. § 1127. 3. The Legislative Histories of 19 U.S.C. § 1526(e) and (f) Congress enacted the civil penalty provision, 19 U.S.C. § 1526(f), in the ACPA in 1996. The legislative history of the ACPA demonstrates that Congress intended to protect consumers who unwittingly purchase “counterfeit products” because such products “are rarely of the same quality as the genuine article,” because consumers may blame the owner of the registered mark for their shoddy purchases, and because consumers may suffer harm when substandard products fail. H.R. Rep. No. 104-556, at 1-4 (1996), reprinted in 1996 U.S.C.C.A.N. 1074, 1074-77. Able Time argues that this legislative history shows that Congress was thinking in terms of counterfeit goods, not counterfeit trademarks separate and apart from the products on which they appear. Able Time argues that this requires reading an identity of goods and services requirement into the Tariff Act. [10] The references to “counterfeit products” and the “genuine article” in the legislative history of § 1526(f) do not constitute the sort of “clearly expressed legislative intention” required to overcome plain statutory text. GTE Sylvania, 447 U.S. at 108. The recognition that some cases of counterfeiting will involve the same goods as those manufactured by the owner of the registered mark does not mean that all cases must involve the same goods, particularly in light of plain statutory language with no such requirement. See 4 McCarthy § 25:10 (“Often, counterfeit merchandise is made so as to imitate a well-known product . . . .”) (emphasis added). The references to counterfeit products rather than counterfeit marks UNITED STATES v. ABLE TIME, INC. 13669 appear in a general discussion of the statute, in a section entitled “Background and Need for the Legislation.” H.R. Rep. No. 104-556, at 1, reprinted in 1996 U.S.C.C.A.N. at 1075. The passages containing these references do not specifically discuss the definition of the term “counterfeit,” and they do not appear intended to define or restrict its meaning. Moreover, applying a civil penalty in the instant case will combat the very harm identified in the legislative history: it will protect consumers from being misled into purchasing generic watches that they mistakenly believe come from Tommy Hilfiger. [11] The legislative history of 19 U.S.C. § 1526(e) also does not undercut the plain text of the Tariff Act. Congress enacted § 1526(e), the seizure and forfeiture provision, in the 1978 Act. The legislative history of the 1978 Act explains that the Senate amendment containing what eventually became § 1526(e) was intended “solely to strengthen the remedies available to prevent the importation of merchandise bearing [a counterfeit] mark.” H.R. Rep. No. 95-1517, at 17 (1978) (Conf. Rep.), reprinted in 1978 U.S.C.C.A.N. 2249, 2259.5 If anything, this weighs in favor of construing § 1526(e) to more broadly prevent the importation of merchandise bearing a counterfeit mark. The legislative history also refers to counterfeit marks, which shows Congress was not thinking purely in terms of counterfeit products when it enacted the statute. 5 The legislative history of the § 1526(e) provides: The House receded from its disagreement with the Senate amendment with amendments to clearly limit the Senate amendment to merchandise bearing a counterfeit mark as defined in section 45 of the Act of July 5, 1946 (the Lanham Act) [15 U.S.C. § 1127], as the amendment is intended solely to strengthen the remedies available to prevent the importation of merchandise bearing such a mark . . . . H.R. Rep. No. 1517, at 17 (1978), reprinted in 1978 U.S.C.C.A.N. 2249, 2259. 13670 UNITED STATES v. ABLE TIME, INC. Accordingly, the legislative histories of § 1526(e) and (f) tend to support the plain text interpretation. Our review of the legislative histories of the other statutory provisions directly at issue reveals nothing to the contrary. 4. The Legislative History of the 1984 Act [12] Able Time argues that the legislative history of the 1984 Act shows that Congress was attempting to combat counterfeit products that might cause consumers harm, not counterfeit marks in isolation. We decline to rely on the legislative history of the 1984 Act, however, because it relates only to statutory provisions that are not at issue. Accord United States v. 10,510 Packaged Computer Towers, 152 F. Supp. 2d 1189, 1199 (N.D. Cal. 2001) (“Aside from the fact that the cited language [in the legislative history of the 1984 Act] refers to an entirely different statute, its reference is to a criminal statute.”); see also 2 Anne Gilson LaLonde, Gilson on Trademarks § 5.19[2][a] at 5-218 & nn. 16-17 (2007) [hereinafter Gilson] (discussing the civil and criminal provisions of the 1984 Act, not the definition of counterfeit in 15 U.S.C. § 1127). [13] As discussed above, the 1984 Act established civil and criminal provisions with definitions of “counterfeit” that include an express identity of goods or services requirement. See 15 U.S.C. § 1116(d)(1)(B)(i); 18 U.S.C. § 2320(e)(1) (A)(iii). Neither of these provisions is at issue. The legislative history of the 1984 Act warns us that “[u]nless it does so explicitly, this act does not in any way modify the Lanham Act or judicial interpretation of it.” Joint Congressional Statement on 1984 Trademark Counterfeiting Legislation, 130 Cong. Rec. H12076, H12076 (Oct. 10, 1984) [hereinafter Joint Statement], reprinted in 7 McCarthy at App. A8-3. It also recognized that the “Lanham Act relates to ‘marks’ rather than ‘goods or services’ ” and stated that changing the Lanham Act definition of “counterfeit” to follow the definitions established by the 1984 Act was “beyond the scope” of the UNITED STATES v. ABLE TIME, INC. 13671 1984 Act, because the 1984 Act was a “compromise” bill, not “an overall redrafting of the trademark law.” Joint Statement at H12076, reprinted in 7 McCarthy at App. A8-3 to A8-4.6 These statements weigh against relying on the legislative history of the 1984 Act in any context other than the civil and criminal provisions that it established, neither of which is at issue. [14] Two other aspects of the 1984 Act deserve mention. Its legislative history states that the definitions of “counterfeit” in the civil and criminal provisions are “identical in substance.” Joint Statement at H12078, reprinted in 7 McCarthy at App. A8-9.7 This statement equates the civil provision with 6 The Joint Statement provides: This key criminal provision represents a compromise between the Senate and House bills. The Senate bill was drafted to prohibit “trafficking in counterfeit goods or services,” while the House bill barred “use of a counterfeit mark” in connection with goods or services. Both the House and Senate sponsors recognize that a mark can be “counterfeit” only if it is used in connection with certain types of goods or services. However, conduct regulated by the Lanham Act relates to “marks” rather than “goods or services”: the sponsors feared that it might create confusion to adopt the terminology of “counterfeit goods or services” in a piecemeal fashion. An overall redrafting of the trademark laws is an appropriate way to make such changes and is beyond the scope of this legislation. Joint Statement at H12076, reprinted in 7 McCarthy at App. A8-3 to A8- 4. 7 The Joint Statement continues: The proposed act defines “counterfeit mark” in two places—in the criminal code amendment, proposed 18 U.S.C. 2320(d), and in the Lanham Act amendment, proposed 15 U.S.C. 1116(d)(1)(B) . . . . For technical reasons, the two definitions of “counterfeit mark” differ slightly in their terms, but they are identical in substance. The Lanham Act already contains a definition of the term “counterfeit”: a “spurious mark which is identical with, or substantially indistinguishable from, a registered mark.” 15 U.S.C. 1127 [sic]. Because it is part of the Lanham Act, the definition of “counterfeit mark” contained in proposed subsection 1116(1)(B) incorporates the section 1127 definition. Joint Statement at H12078, reprinted in 7 McCarthy at App. A8-9. 13672 UNITED STATES v. ABLE TIME, INC. the criminal provision. It does not equate either of them with the definition at issue here, which is contained in 15 U.S.C. § 1127. It also states that the civil provision’s definition “incorporates the section 1127 definition.” Id; accord 2 Gilson § 5.19[3][a] at 5-220. It does not state the converse—that the Section 1127 definition incorporates the civil provision’s definition. We reject the contrary conclusions of other authorities. See United States v. 1,234 Watches, No. CV-00 11782, Doc. No 46, slip op. at 20-21 (C.D. Cal. Jan. 16, 2002) (unpublished) (concluding that watches bearing the mark “TOMMY” were not subject to forfeiture as counterfeit under 19 U.S.C. §1526(e) because Tommy Hilfiger did not manufacture watches or related goods at the time of seizure) (citing 4 McCarthy § 25:15; Playboy Enters. v. Universal Tel-A-Talk Inc., 48 U.S.P.Q. 2d 1779, 1782 & n.8 (E.D. Pa. 1998)); Ross II, 18 C.I.T. at 986. We decline to narrow the definition of counterfeit contained in 15 U.S.C. § 1127 beyond its plain meaning simply because much of the litigation and academic discussion regarding counterfeit goods arises in the context of the civil and criminal provisions of the 1984 Act, statutes that are not at issue here.