SUPREME COURT WILL HEAR GRAY MARKET GOODS CASE IN APRIL

Executive Summary

SUPREME COURT WILL HEAR GRAY MARKET GOODS CASE IN APRIL, or October 1987. The court granted three writs of certiorari on Dec. 8 to petitioners K mart, electronics discounter 47th Street Photo and the United States Customs Service. A hearing date has not been set, but oral arguments will be presented to the justices either at end of the court's hearing schedule in April 1987, or in October when the next term begins. The petitioners will attempt to persuade the court to overturn the May 6 D.C. Circuit Court ruling that Customs Service regs permitting the importation of gray market goods are invalid interpretations of Sec. 526 of the Tariff Act. The ruling responded to a case brought by the Coalition to Preserve the Integrity of American Trademarks (COPIAT) against intervenor/defendants K mart and 47th Street Photo. The D.C. Circuit Court's decision conflicted with the two earlier rulings in separate federal appeals courts, Vivitar Corp. v. U.S. (1984) and Duracell v. the International Trade Commission (1985). In Vivitar, the camera company lost an appellate ruling which upheld the legality of the Customs regs. In the second case, the trade commission's ruling barring importation of diverted Duracell batteries eventually was blocked by the Reagan Administration.