• Obama’s Order of New Agency
  • March 17, 2014 | Author: Timothy B. McCormack
  • Law Firm: McCormack Intellectual Property Law PS - Seattle Office
  • President Obama Orders a New Agency to Monitor and Enforce Intellectual Property Rights Interagency Trade Enforcement Center Means More Free Trade?

    The Potential Affects on Seattle Businesses

    Last week President Obama established a new Interagency Trade Enforcement Center (ITEC) through an Executive Order. (You can read the order here) The new agency will strengthen trade enforcement of intellectual property rights in international trade agreements. The new agency is important because intellectual property is a fundamental business asset for most Seattle based businesses. Intellectual property is the United State’s second largest export. In an era of bipartisan bickering about “free trade” and market forces it is great to see an executive order aimed at helping to make “free trade” more free. Market forces are great and as capitalists we love to let our markets work but when other countries are unfairly competing and breaking our existing agreements the trade is not “free.” In fact, without government intervention on some kind our domestic based businesses are in serious jeopardy. This is what the Constitution envisioned as helping to protect the common good.

    Government and industry studies show that intellectual property infringers cost U.S. businesses billions of dollars in lost revenue every year and result in millions of lost jobs. For example, a recent U.S. Trade Commission study found that an estimated $48 billion in revenue was lost in 2009 due to intellectual property violations from China alone.

    As Rep. Mike Michaud (D-Maine), chairman of the House Trade Working Group, stated, “Signing this order brings us one more important step closer to the level of trade enforcement we need to counter the predatory practices of countries like China.”

    What is Intellectual Property?

    Intellectual Property encompasses creations of the mind (intangible assets) and is protected under four basic bodies of law: trademark, patent, copyright and trade secret. Trademark law prohibits competitors from passing off their goods as those of another. Patent law provides a limited monopoly for new and inventive products and processes. Copyright law protects a broad range of artistic, literary and musical works of authorship. Trade secret law protects a company’s confidential information.

    Why is Intellectual Property Important?

    The United States has shifted to an information-based economy. This has made it increasingly vulnerable to piracy and expropriation. Certain foreign countries have inadequate protection of intellectual property rights. As the United States continues to suffer from trade imbalances and budget deficits the international protection of intellectual property has become an important trade issue.

    Unchecked violations of intellectual property rights undermine the incentive structure that trademark, patent, and copyright laws are designed to promote. The incentive structure drives business investment in new products and services providing new jobs and economic growth. This creates future economic growth and is what drives much of Seattle’s local economy.

    Recourses for International Violations of Intellectual Property Rights

    Seattle companies have traditionally looked to basic international treaties as a remedy against the piracy of their intellectual property. For an owner of intellectual property, however, these treaties fall short of providing effective protection because they lack the power to enforce rights or to settle disputes. For these reasons, last week President Obama established a new Interagency Trade Enforcement Center through an Executive Order to help United States business combat intellectual property violations.

    President Obama’s Order of an Interagency Trade Enforcement Center

    The Interagency Trade Enforcement Center (ITEC) will be established within the Office of the United States Trade Representative (USTR). ITEC will strengthen U.S. capacity to monitor and enforce U.S. trade rights and domestic trade laws, and enhance market access to U.S. exporters, executive departments, and agencies. ITEC will coordinate matters relating to enforcement of U.S. trade rights under international trade agreements and the enforcement of domestic trade laws among USTR, the Departments of State, Treasury, Justice, Agriculture, Commerce, Homeland Security, and the Office of the Director of National Intelligence, and other agencies as designated.

    The reason behind the creation of the new Agency was stated as follows:

    Robust monitoring and enforcement of U.S. rights under international trade agreements, and enforcement of domestic trade laws, are crucial to expanding exports and ensuring U.S. workers, businesses, ranchers, and farmers are able to compete on a level playing field with foreign trade partners. To strengthen our capacity to monitor and enforce U.S. trade rights and domestic trade laws, and thereby enhance market access for U.S. exporters, executive departments and agencies (agencies) must coordinate and augment their efforts to identify and reduce or eliminate foreign trade barriers and unfair foreign trade practices to ensure that U.S. workers, businesses, ranchers, and farmers receive the maximum benefit from our international trade agreements and under domestic trade laws.

    The mission of ITEC is to serve as the primary forum within the Federal Government for USTR and other agencies to coordinate enforcement of U.S. trade rights under international trade agreements. ITEC will also coordinate among USTR, other agencies with trade related responsibilities, and the U.S. Intelligence Community. ITEC will facilitate the exchange of information related to potential violations of international trade agreements by foreign trade partners. Another function of ITEC is to conduct outreach to U.S. workers, businesses, and other interested persons to foster greater participation in the identification and reduction or elimination of foreign trade barriers and unfair trade practices.

    President Obama’s order stated the mission as:

    Sec. 3. Mission and Functions. The Center shall:

    (a) serve as the primary forum within the Federal Government for USTR and other agencies to coordinate enforcement of U.S. trade rights under international trade agreements and enforcement of domestic trade laws;

    (b) coordinate among USTR, other agencies with trade related responsibilities, and the U.S. Intelligence Community the exchange of information related to potential violations of international trade agreements by our foreign trade partners; and

    (c) conduct outreach to U.S. workers, businesses, and other interested persons to foster greater participation in the identification and reduction or elimination of foreign trade barriers and unfair foreign trade practices.

    Conclusion

    The United States needs to strengthen its international intellectual property law protection. President Obama’s order for an Interagency Trade Enforcement Center will help achieve this objective. The new order will help Seattle business’s protect their valuable intellectual property assets. As Rep. Mike Michaud (D-Maine), chairman of the House Trade Working Group, stated, “Signing this order brings us one more important step closer to the level of trade enforcement we need to counter the predatory practices of countries like China.”

    If you have any additional questions about intellectual property infringement and how it affects your business you should contact an intellectual property attorney such as McCormack Intellectual Property, LLP.

    Special Thanks to Eric Harrison our 2011 summer associate who will soon graduate from the University of Washington School of Law.

    Article by Timothy B. McCormack, a well established and successful Seattle-based intellectual property, technology and business lawyer.

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