Parallel Importation--Legitimate Goods or Trademark Infringement?

Conflicts in interpretations of section 42 of the Lanham Act and section 526 of the Tariff Act of 1930 have led to divergent results in several federal courts. Although advocates on each side of the controversy present valid arguments supporting their positions, the dispute should be resolved by analyzing the purpose of the Lanham Act and the Tariff Act. The goal of these acts is protection of consumers and United States industry. Strict application of these statutes would achieve this result.

Parallel imports provide goods at lower prices but confuse the consumer as to the origin of the goods and the warranties and services that accompany the goods. This confusion clearly fails the Lanham Act test for trademark infringement. Parallel importation also undermines the value of the trademark investment, thereby harming the owner of the United States trademark. Until some clear congressional action is taken to clarify the present situation involving parallel imports, courts should interpret section 42 of the Lanham Act and section 526 of the Tariff Act to protect both the consumer and the owner of the Unites States trademark.

Such an interpretation would follow most closely the original purpose of both acts.