Weekly IP Buzz for the Week Ending January 22, 2021

January 25, 2021 Darin M. Klemchuk

In this week's post, we see that a new trend, at the intersection of intellectual property and tax law, now sees recoveries from patent disputes being increasingly treated as capital gains.

Plus, to help with the growing concern of counterfeit product for sale on Amazon, the company offers a brand gating process designed to help identify and prevent third-party resellers from offering counterfeit goods for sale on Amazon.com.

Patent Infringement Damages May Qualify as Capital Gains

Since the previous year, there has been a new trend in the intersection of intellectual property law and tax law. More specifically, there has been a rise in claimants and plaintiffs that have treated the awards they win, from patent litigation, as capital gains when it comes to filing taxes. This is in stark contrast to the more normal routine of treating monetary settlements as an extension of royalties, which is then only taxable as ordinary income.

Find the full article here.

Brand Gating on Amazon: A Way to Help Prevent Counterfeiting

The globalization of the Internet and tremendous growth of online sales have greatly benefitted manufacturer and retailers alike. But these advances come with their own challenges. Amazon’s focus on third-party resellers (fueling their ever-increasing growth), has sometimes undermined the trustworthiness of the resellers and products offered on its platform. Amazon created “brand gating” to minimize and ultimately eradicate the sale of counterfeit goods on Amazon. This process allows participating manufacturers to limit which resellers may offer their brands on Amazon.