Good article on the war on fakes.

[triniboy27]

The real deal: Lawyers wage war against fakes on Web

JACQUIE MCNISH

From Wednesday's Globe and Mail

Most working days, law professionals in the New York offices of Torys LLP sit at computers and scour the Internet for cheap designer goods. Shouts of "Bingo" ring out when unbelievable deals are spotted.

The lawyers and paralegals are not searching for bargains, it should be explained, they are trolling for litigation work.

"If it's a Gucci necklace on sale for $75, you don't have to be a genius to figure out that this stuff isn't real," said Torys lawyer Louis Ederer.

Mr. Ederer should know. Gucci America Inc., which typically charges thousands of dollars for a single piece of its jewellery, is one of a number of high-end designers that has hired the trademark litigator and his New York team to defend their brands against a tidal wave of counterfeit goods flooding Internet auction sites. His other clients include tony jeweller David Yurman, women's label XOXO and jeans label Edwin Co. Ltd.

"There's rampant counterfeiting going on at these sites and my clients in the luxury goods sector are very focused on this problem," he said.

No one disagrees that sales of fake designer goods are pervasive on the Internet. What is disputed, however, is who is responsible for cleaning up the counterfeit mess. The fight has generated some harsh new shopping laws, innovative litigation and increased demand for trademark lawyers such as Mr. Ederer, who must be part gumshoe, part geek and part litigator to protect clients' brands.

The stakes are rising in the war against knockoffs. Last year, Italy passed a new law requiring shoppers to pay thousands of dollars in fines if they were caught buying fake goods.

In the United States, one of the country's most prominent jewellers, Tiffany & Co., filed a groundbreaking lawsuit against on-line auction giant eBay Inc., claiming the Internet auctioneer was contributing to trademark fraud by failing to properly screen items sold on its service. After an investigation in 2004, Tiffany found 73 per cent of 186 pieces of Tiffany-labelled silver jewellery sold on eBay were fake. The auctioneer has responded that it frequently shuts down auctions when alerted that items are fake, but argues it has no responsibility to verify the authenticity of items sold through its on-line service.

Mr. Ederer has heard this argument before. Until recently, his practice was focused largely on pursuing traditional "bricks and mortar" stores that sold knockoffs of designer jewellery, clothing and accessories. He is one of a number of U.S. litigators who has recently made strides in the war against brand pirates by persuading courts that retailers have a legal responsibility to help ensure the goods they sell are not counterfeit.

In 2003, a district court judge in Atlanta agreed with Mr. Ederer and his client, clothing designer Tommy Hilfiger Licensing Inc., that a retail chain operated by Goody's Family Clothing Inc. should have paid attention to warning signs when it sold over 90,000 fake Hilfiger T-shirts at its 350 stores.

The court found that Goody's failed to take sufficient steps to verify the authenticity of the shirts and ordered the retailer to pay nearly $9-million (U.S.) in lost profits to Hilfiger.

Will the willful blindness argument prevail in Tiffany's case against eBay? Trademark specialists will likely have to wait until the end of the year to find out, when the case is set to go to court. What will be tested in this case is whether Internet-based auction sites have the same legal responsibility as bricks and mortar stores to be alert to counterfeit goods.

If the court agrees with Tiffany that eBay should be more vigilant, a wave of lawsuits can be expected against other Internet vendors such as Yahoo Inc. and Amazon.com Inc.

EBay has argued that its website services are not comparable to retail stores because it operates merely as an exchange that brings buyers and sellers together. Furthermor

[denimdestroyedmylife]

interesting stuff, thanks.

can't let this go by without recommending The Recognitions by William Gaddis and The Counterfeiters by Andre Gide. and Fake Can Be Just as Good, by Blonde Redhead.

[Paul T]

I was chatting to an acquaintance involved in tracking down counterfiets, and he told me about a great sting that one of the big sportswear manufacturers pulled off recently.

Thye had someone go to a Thai company, explain that he had the design of the new England soccer strip, and that he wanted 5,000 sets manufacturing. He went round several companies getting estimates, went with one of them and ordered the 5,000 sets.

Of course, that manufacturers sold the 'secret' design to everyone in the far East, and tens of thousands more were produced. He got delivery of his 5,000 and destroyed them, but the markets across the UK were full of the things. And of course when the real England strip was officially announced, everyone right down the counterfeit chain - manufacturers, jobbers & retailers - got burned. You could say they lost their shirts...

[Kasper]

Quote: I was chatting to an acquaintance involved in tracking down counterfiets, and he told me about a great sting that one of the big sportswear manufacturers pulled off recently.

Thye had someone go to a Thai company, explain that he had the design of the new England soccer strip, and that he wanted 5,000 sets manufacturing. He went round several companies getting estimates, went with one of them and ordered the 5,000 sets.

Of course, that manufacturers sold the 'secret' design to everyone in the far East, and tens of thousands more were produced. He got delivery of his 5,000 and destroyed them, but the markets across the UK were full of the things. And of course when the real England strip was officially announced, everyone right down the counterfeit chain - manufacturers, jobbers & retailers - got burned. You could say they lost their shirts...

such a nice thing for Umbro to do. i wish more companies would do the same.