1.1                          A bill for an act 
  1.2             relating to crime; imposing criminal penalties for 
  1.3             manufacturing, distributing, selling, or possessing 
  1.4             with intent to sell or distribute counterfeited 
  1.5             intellectual property; providing for forfeiture of 
  1.6             these items; amending Minnesota Statutes 1998, 
  1.7             sections 609.531, subdivision 1; and 609.902, 
  1.8             subdivision 4; proposing coding for new law in 
  1.9             Minnesota Statutes, chapter 609. 
  1.10  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.11     Section 1.  Minnesota Statutes 1998, section 609.531, 
  1.12  subdivision 1, is amended to read: 
  1.13     Subdivision 1.  [DEFINITIONS.] For the purpose of sections 
  1.14  609.531 to 609.5318, the following terms have the meanings given 
  1.15  them.  
  1.16     (a) "Conveyance device" means a device used for 
  1.17  transportation and includes, but is not limited to, a motor 
  1.18  vehicle, trailer, snowmobile, airplane, and vessel and any 
  1.19  equipment attached to it.  The term "conveyance device" does not 
  1.20  include property which is, in fact, itself stolen or taken in 
  1.21  violation of the law.  
  1.22     (b) "Weapon used" means a dangerous weapon as defined under 
  1.23  section 609.02, subdivision 6, that the actor used or had in 
  1.24  possession in furtherance of a crime.  
  1.25     (c) "Property" means property as defined in section 609.52, 
  1.26  subdivision 1, clause (1).  
  1.27     (d) "Contraband" means property which is illegal to possess 
  2.1   under Minnesota law.  
  2.2      (e) "Appropriate agency" means the bureau of criminal 
  2.3   apprehension, the Minnesota state patrol, a county sheriff's 
  2.4   department, the suburban Hennepin regional park district park 
  2.5   rangers, the department of natural resources division of 
  2.6   enforcement, the University of Minnesota police department, or a 
  2.7   city or airport police department.  
  2.8      (f) "Designated offense" includes:  
  2.9      (1) for weapons used:  any violation of this chapter, 
  2.10  chapter 152, or chapter 624; 
  2.11     (2) for all other purposes:  a felony violation of, or a 
  2.12  felony-level attempt or conspiracy to violate, section 325E.17; 
  2.13  325E.18; 609.185; 609.19; 609.195; 609.21; 609.221; 609.222; 
  2.14  609.223; 609.2231; 609.24; 609.245; 609.25; 609.255; 609.322; 
  2.15  609.342, subdivision 1, clauses (a) to (f); 609.343, subdivision 
  2.16  1, clauses (a) to (f); 609.344, subdivision 1, clauses (a) to 
  2.17  (e), and (h) to (j); 609.345, subdivision 1, clauses (a) to (e), 
  2.18  and (h) to (j); 609.42; 609.425; 609.466; 609.485; 609.487; 
  2.19  609.52; 609.525; 609.53; 609.54; 609.551; 609.561; 609.562; 
  2.20  609.563; 609.582; 609.59; 609.595; 609.631; 609.66, subdivision 
  2.21  1e; 609.671, subdivisions 3, 4, 5, 8, and 12; 609.687; 609.821; 
  2.22  609.825; 609.86; 609.88; 609.89; 609.893; 609.895; 617.246; or a 
  2.23  gross misdemeanor or felony violation of section 609.891 or 
  2.24  624.7181; or any violation of section 609.324.  
  2.25     (g) "Controlled substance" has the meaning given in section 
  2.26  152.01, subdivision 4. 
  2.27     Sec. 2.  [609.895] [COUNTERFEITED INTELLECTUAL PROPERTY; 
  2.28  PENALTIES.] 
  2.29     Subdivision 1.  [DEFINITIONS.] (a) As used in this section, 
  2.30  the following terms have the meanings given them. 
  2.31     (b) "Counterfeit mark" means: 
  2.32     (1) any unauthorized reproduction or copy of intellectual 
  2.33  property; or 
  2.34     (2) intellectual property affixed to any item without the 
  2.35  authority of the owner of the intellectual property. 
  2.36     (c) "Counterfeited item or service" means an item or 
  3.1   service bearing or identified by a counterfeit mark. 
  3.2      (d) "Intellectual property" means any trademark, service 
  3.3   mark, or trade name. 
  3.4      (e) "Retail value" means: 
  3.5      (1) the usual selling price of the article or service 
  3.6   bearing or identified by the counterfeit mark; or 
  3.7      (2) the usual selling price of a finished product on or in 
  3.8   which components bearing or identified by a counterfeit mark are 
  3.9   used. 
  3.10     (f) "Service mark" means a mark used by a person to 
  3.11  identify services and to distinguish them from the services of 
  3.12  others. 
  3.13     (g) "Trademark" means a mark used by a person to identify 
  3.14  goods and to distinguish them from the goods of others. 
  3.15     (h) "Trade name" means a word, name, symbol, device, or any 
  3.16  combination of the foregoing in any form or arrangement, used by 
  3.17  a person to identify the person's business, vocation, or 
  3.18  occupation and to distinguish it from the business, vocation, or 
  3.19  occupation of others. 
  3.20     Subd. 2.  [CRIME.] A person who intentionally manufactures, 
  3.21  produces, distributes, offers for sale, sells, or possesses with 
  3.22  intent to sell or distribute any counterfeited item or service, 
  3.23  knowing or having reason to know that the item or service is 
  3.24  counterfeit, is guilty of counterfeiting intellectual property 
  3.25  and may be punished as provided in subdivision 3. 
  3.26     Subd. 3.  [PENALTIES.] (a) A person who is convicted of 
  3.27  violating subdivision 2 may be sentenced to imprisonment for not 
  3.28  more than five years or to payment of a fine of not more than 
  3.29  $100,000, or both, if: 
  3.30     (1) the violation involves the manufacture or production of 
  3.31  a counterfeited item or items; 
  3.32     (2) the violation involves the distribution, offer for 
  3.33  sale, sale, or possession with intent to sell or distribute 
  3.34  1,000 or more counterfeited items; 
  3.35     (3) the violation involves the distribution, offer for 
  3.36  sale, sale, or possession with intent to sell or distribute 
  4.1   counterfeited items or services having a retail value of more 
  4.2   than $10,000; or 
  4.3      (4) the defendant has two or more prior convictions for 
  4.4   violating this section or a law of another state or the United 
  4.5   States that provides criminal penalties for counterfeiting 
  4.6   intellectual property. 
  4.7      (b) Except as otherwise provided in paragraph (a), a person 
  4.8   who is convicted of violating subdivision 2 may be sentenced to 
  4.9   imprisonment for not more than three years or to payment of a 
  4.10  fine of not more than $50,000, or both, if: 
  4.11     (1) the violation involves more than 100 but fewer than 
  4.12  1,000 counterfeited items; 
  4.13     (2) the violation involves counterfeited items or services 
  4.14  having a retail value of more than $1,000 but not more than 
  4.15  $10,000; or 
  4.16     (3) the defendant has one prior conviction for violating 
  4.17  this section or a law of another state or the United States that 
  4.18  provides criminal penalties for counterfeiting intellectual 
  4.19  property. 
  4.20     (c) A person may be sentenced to imprisonment for not more 
  4.21  than one year or to payment of a fine of not more than $3,000, 
  4.22  or both, if the person is convicted of violating subdivision 2, 
  4.23  under circumstances not described in paragraph (a) or (b).  
  4.24     (d) If the defendant distributes, sells, offers for sale, 
  4.25  or possesses with intent to sell or distribute more than one 
  4.26  item or service bearing or identified by more than one 
  4.27  counterfeit mark, the quantity or retail value of these items 
  4.28  and services may be aggregated for purposes of determining 
  4.29  penalties under this subdivision. 
  4.30     Subd. 4.  [ALTERNATIVE FINE.] In lieu of the fine 
  4.31  authorized by subdivision 3, a person convicted of violating 
  4.32  this section who received economic gain from the act or caused 
  4.33  economic loss during the act may be sentenced to pay a fine 
  4.34  calculated in the manner provided in section 609.904, 
  4.35  subdivision 2. 
  4.36     Subd. 5.  [FORFEITURE.] Property used to commit or 
  5.1   facilitate the commission of a violation of this section, and 
  5.2   all money and property representing proceeds of a violation of 
  5.3   this section, shall be forfeited in accordance with sections 
  5.4   609.531 to 609.5316.  Notwithstanding any provision of section 
  5.5   609.5315 to the contrary, forfeited items bearing or identified 
  5.6   by a counterfeit mark must be destroyed unless the intellectual 
  5.7   property owner consents to another disposition. 
  5.8      Subd. 6.  [PRIMA FACIE EVIDENCE.] A Minnesota or federal 
  5.9   certificate of registration of an intellectual property is prima 
  5.10  facie evidence of the registrant's ownership and exclusive right 
  5.11  to use the intellectual property in connection with the goods or 
  5.12  services described in the certificate. 
  5.13     Sec. 3.  Minnesota Statutes 1998, section 609.902, 
  5.14  subdivision 4, is amended to read: 
  5.15     Subd. 4.  [CRIMINAL ACT.] "Criminal act" means conduct 
  5.16  constituting, or a conspiracy or attempt to commit, a felony 
  5.17  violation of chapter 152, or a felony violation of section 
  5.18  297D.09; 299F.79; 299F.80; 299F.82; 609.185; 609.19; 609.195; 
  5.19  609.20; 609.205; 609.221; 609.222; 609.223; 609.2231; 609.228; 
  5.20  609.235; 609.245; 609.25; 609.27; 609.322; 609.342; 609.343; 
  5.21  609.344; 609.345; 609.42; 609.48; 609.485; 609.495; 609.496; 
  5.22  609.497; 609.498; 609.52, subdivision 2, if the offense is 
  5.23  punishable under subdivision 3, clause (3)(b) or clause 3(d)(v) 
  5.24  or (vi); section 609.52, subdivision 2, clause (4); 609.53; 
  5.25  609.561; 609.562; 609.582, subdivision 1 or 2; 609.668, 
  5.26  subdivision 6, paragraph (a); 609.67; 609.687; 609.713; 609.86; 
  5.27  609.894, subdivision 3 or 4; 609.895; 624.713; 624.74; or 
  5.28  626A.02, subdivision 1, if the offense is punishable under 
  5.29  section 626A.02, subdivision 4, paragraph (a).  "Criminal act" 
  5.30  also includes conduct constituting, or a conspiracy or attempt 
  5.31  to commit, a felony violation of section 609.52, subdivision 2, 
  5.32  clause (3), (4), (15), or (16), if the violation involves an 
  5.33  insurance company as defined in section 60A.02, subdivision 4, a 
  5.34  nonprofit health service plan corporation regulated under 
  5.35  chapter 62C, a health maintenance organization regulated under 
  5.36  chapter 62D, or a fraternal benefit society regulated under 
  6.1   chapter 64B. 
  6.2      Sec. 4.  [EFFECTIVE DATE.] 
  6.3      Sections 1 to 3 are effective August 1, 1999, and apply to 
  6.4   violations occurring on or after that date.