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Parallel Imports

The language of 42 of the Lanham Act does not bar importation of goods that are genuine or more commonly know as grey market goods. The United States Customs & Border Protection (CBP) provides grey market protection only to trademarks that have been recorded with CBP and where the U.S. trademark owner does not own the foreign trademarks abroad and no common ownership or control exists between the U.S. trademark owner and a foreign trademark owner. To record copyright rights with CBP the claim to copyright will have been registered with the U.S. Copyright Office.

Parallel importation of trademarked goods within the European Union has been highly publicised and much debated. Essentially, a registered trademark owner may prevent importation of goods bearing its trademark into the EU in certain circumstances. However, once the trademarked goods have been put on the market within the EU by or with the consent of the trademark owner, the right to control the movement of those goods is lost.

Prarallel imports is a confusing subject. Basically, it is importing goods manufactured abroad that are available in the country. Some parallel imports, or grey market goods, are not allowed. Specifically those where the product is materially different from the product sold in the US. But, the many courts differ.

In Great Britain the trademark holder can block the importation of his goods into the country, period. Low-life American/British companies are using this as an excuse to terminate eBay auctions for their goods being sold internationally even though they haven't been sold yet. Instead of telling the seller to add "No British Sales" to their listings, they take the harmful route of claiming trademark infringement and eBay doesn't care.

Although there are a number of laws in the United States that address the issue of parallel imports of trademarked products, the treatment of parallel imports is fairly uniform. In an early decision permitting the unauthorized importation and sale of genuine bottled water from Europe, it was held that once a trademarked product is placed on the market, trade mark rights may not be used to control the product's further destination.

Although decided under common law principles of trademark law, this early decision was subsequently applied to the codified trademark law and has remained the law to this day under the infringement provisions of the present day Lanham Act. Thus US laws have long considered that the nature of trademark rights, at least with respect to parallel imports, are universal, namely, once a genuine trademarked product is placed on the global marketplace anywhere in the world, by or with the consent of the trademark owner, the trademark owner may not control the further distribution of that product under a theory of trademark infringement. This theory of parallel imports is said to be the rule of universal, or international, exhaustion.

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