Anatomy of An Ex-Parte Proceeding For Counterfeit Trademark Infringement

An ex-parte proceeding is one where the alleged infringer, the soon to be defendant, is denied the right to *due process under the law, rights afforded in the Fifth and the Fourteenth amendments to the United States Constitution. Essentially, the Court can temporarily waive or put these rights aside determining that the rights of the trademark holder trump the rights of the accused before the court. But, as outlined above, the authors of the TCA of 1984, recognized the danger of undue and potentially constitutionally violative intrusions sanctioned by the government. So they put in place strict guidelines and limits to use of the procedure. The language of the releveant statue, *15 USC 1116 :

The court shall not grant such an application unless--
(A) the person obtaining an order under this subsection provides the security determined adequate by the court for the payment of such damages as any person may be entitled to recover as a result of a wrongful seizure or wrongful attempted seizure under this subsection; and
(B) the court finds that it clearly appears from specific facts that--
(i) an order other than an ex parte seizure order is not adequate to achieve the purposes of section 32 of this Act (15 U.S.C. 1114);
(ii) the applicant has not publicized the requested seizure;
(iii) the applicant is likely to succeed in showing that the person against whom seizure would be ordered used a counterfeit mark in connection with the sale, offering for sale, or distribution of goods or services;
(iv) an immediate and irreparable injury will occur if such seizure is not ordered;
(v) the matter to be seized will be located at the place identified in the application;
(vi) the harm to the applicant of denying the application outweighs the harm to the legitimate interests of the person against whom seizure would be ordered of granting the application; and
(vii) the person against whom seizure would be ordered, or persons acting in concert with such person, would destroy, move, hide, or otherwise make such matter inaccessible to the court, if the applicant were to proceed on notice to such person.

In review of the above:

The applicant/trademark owner is asking the court to temporarily waive the rights of the alleged infringer, rights guaranteed in the United States Constitution. A remarkable request to make. The clear language of the statute requires that several preconditions be met. That a security bond be posted (1116 (A)) and that the applicant does not publicize the issuance of the warrant(1116 (B)(ii)). Both of these requirements are to protect the interests of the soon to be defendant. Both are reasonable and easily met.

So far, so good. But now we get to some of the more 'problematic' requirements.

"the court finds that it clearly appears from specific facts that--
(1116 (B)(i)) an order other than an ex parte seizure order is not adequate to achieve the purposes of section 32 of this Act" Here the applicant will likely argue damage (incredible) and harm (irreparable) and many creative and hyperbolic variations of the same before finally concluding breathlessly, with 'no other remedy under the law.'

(1116 (B)(iv) "an immediate and irreparable injury will occur if such seizure is not ordered;" Same arguments as used above; damage (extreme) and harm (great) and many creative and hyperbolic variations of the same before finally concluding solemnly, with 'no other remedy under the law.' Considering that the words, 'immediate' and 'irreparable', joined as they are by the word 'and', one would think that an extremely persuasive argument, filled with facts to some proof of such injury would follow. But this is not always the case.

(1116 (B)(vi) " the harm to the applicant of denying the application outweighs the harm to the legitimate interests of the person against whom seizure would be ordered of granting the application;" This is an interesting requirement often addressed by the familiar argument of damage (incalculable) and harm (incredible) and by pointing out to the court that a bond will be posted, the seizure will not be publicized, and that a post seizure hearing will be held and so, the rights of the accused, such as they are, are adequately protected.

(1116 (B)(vii) "the person against whom seizure would be ordered, or persons acting in concert with such person, would destroy, move, hide, or otherwise make such matter inaccessible to the court, if the applicant were to proceed on notice to such person. " This requirement seems pretty straight forward. Proceeded by the wording "The court shall not grant such an application unless--"
" and "the court finds that it clearly appears from specific facts that--" the applicant here, would provide the court with some facts, offer some proof that the accused, based on prior acts, would not obey or otherwise not comply with a court order.
Perhaps this is the type of person with no fixed address. A person who is known by more than one name. A person who has a history of appearances before the court. A shady character or fly-by-night operator. Some specific fact or facts, to persuade the court that this person is not to be trusted, clearly cannot be trusted.
The bar seems to set fairly high for this requirement and this may well be the one requirement that the court may give the most attention, the one that can make or break an application for an ex-parte warrant. For if the defendant, the accused is a legitimate business/individual, with a fixed address, no known aliases, no history before any court other than the odd traffic violation. A business or person in good standing their community. If there are no specific facts to put before the court that this person "would destroy, move, hide, or otherwise make such matter inaccessible to the court, if the applicant were to proceed on notice" then it weakens the application for the warrant in every respect, even if all of the other preconditions and requirements had been met. Why would the court deny the defendant, the accused, a business or person in good standing, the right to due process, the right to be hear fully before the court?
Of course, assuming that all other preconditions and requirements had been met and there is just this one last requirement, this last hurdle to get over ... One could just 'make up' some specific facts here about the defendant, the accused and problem solved!

In Summary:

The requirements for an ex-parte proceeding under 15 USC 1116 are pretty demanding and rightfully so. It is a measure of last resort and an extreme remedy under the law. One would think, expect that the courts give these applications close scrutiny; weighing the rights of the trademark holder and those of the accused based on the specific facts provided by the applicant. Assuming that the applicant is acting in a reasonable and ethical manner in making its application and that the court is mindful of the rights, such as they are, of the accused, then an ex-parte proceeding may well be justified under certain and well defined circumstances.