Chapter 4: Anti-Counterfeiting
Barbara Kolsun and Heather McDonald
Summary adapted from Chapter 4 of "Fashion Law: A Guide for Designers, Fashion Executives and Attorneys" edited by Guillermo C. Jimenez and Barbara Kolsun (Fairchild Books, 2010).
Trademark Counterfeiting is the act of manufacturing or distributing a product or service bearing a mark that is identical to or substantially indistinguishable from a registered trademark. Simply put, trademark counterfeiting is theft of someone's IP. As technology increases, so does the ability of criminals and infringers to copy the trademarks of others and to easily profit. The International Anti-Counterfeiting Coalition (IACC ) estimates losses to U.S. companies due to trademark counterfeiting to be between $200 billion- $250 billion annually. Globally, counterfeiting is approximately a $600 billion a year problem. Chapter 4 discusses what you can do as a brand owner to combat counterfeits.
In order to effectively combat counterfeiting, trademarks and domain names should be registered in all countries where the trademark owner sells, manufacturers, or distributes products or components. Much of today's counterfeiting problem is linked to China although Russia represents a major problem as well. Therefore, it is wise to register trademarks in advance in large markets like China and Russia in order to avoid problems when the brand becomes known. An effective plan also requires that management cooperate with in-house and outside counsel and law enforcement to designate contacts for various needs that may arise, including the production of affidavits of authenticity, the identification of counterfeit goods, providing testimony where necessary, and supporting civil litigation. Brand owners must be prepared to train investigators and law enforcement officials, such as customs officers, how to spot counterfeit products.
Counterfeiting is a crime and may be punished under federal or state criminal statutes. There are also civil remedies available such as seizure of the counterfeit goods and lawsuits against third-parties such as retailers, vendors, landlords and even flea market owners. Once you become aware of counterfeiters your first step should be to send a cease and desist letter. Such a letter will provide notice to the target that the trademark owner is aware of its counterfeiting activities. When dealing with a website a cease and desist letter should be sent to the sites as well as to the ISP hosting the site. Online auctions and "listing" sites are also notorious for their popularity with counterfeiters. It is important to note that the burden is on the trademark owners to monitor their rights. Trademark owners must monitor sites and contact them to terminate counterfeit auctions ("Notice and Take Down").
Counterfeiting is a serious problem that many trademark owners must combat with significant resources. Working together with corporations, in-house counsel, outside counsel and lawmakers, trademark owners can successfully combat the counterfeiting problem.
Author details:
Barbara Kolsun
VP and General Counsel
Stuart Weitzman LLC
New York, New York
Heather McDonald
Baker Hostetler
New York, New York
Summary by: Lara Corchado
