This sounds like part of a law school exam question: The (US) government files an indictment against an outlaw biker gang and seeks forfeiture of its assets. Among those assets are a registered trade-mark for the name of the gang and a distinctive logo. The services with which the trade-mark is associated include, in code, operating biker gang (actually “ASSOCIATION SERVICES, NAMELY, PROMOTING THE INTERESTS OF PERSONS INTERESTED IN THE RECREATION OF RIDING MOTORCYCLES“). The prosecutor says that once the mark is forfeited, police can seize bikers’ colours as trade-mark infringement. Discuss.
I’m not going to give away the answer, except to say it hasn’t been written yet.
Hint: rights of the holder of a registered trade-mark derive from use in the United States, so the government can only enforce the mark if it is using it. For more comment, see: Law Blog – WSJ.com : What Will the Gov’t Do With the Mongol Trademark?.