ANTI-COUNTERFEITING
“Te Tiffany brand is appealing to counterfeiters because it's so recognisable,” says Ewa Abrams, associate general counsel at Tiffany. “Tiffany’s blue packaging is so iconic and identifiable with the brand—I think it is one of the most attractive aspects of the brand to counterfeiters.”
She adds: “Although I believe that it’s basically impossible to completely eradicate counterfeits, the problem is one that cannot be ignored. Most businesses tend to look at their legal and security/investigations departments as cost centres, not profit centres. Brands need to budget accordingly. In creating an effective anti-counterfeiting programme, brands need to balance the brand value gained from protecting their companies’ brand assets against the sometimes high costs of battling counterfeits— ultimately, it's a necessary evil.”
Consumers are attracted to counterfeit goods on the strength of the brand being copied, yet Abrams says that the quality of the products being counterfeited, and the price difference between the counterfeited products and the authentic ones, oſten mean that consumers aren’t aware they are buying fake goods.
Abrams says that Tiffany’s sterling silver jewellery collection (including necklaces, bracelets and key chains) are among its most-counterfeited products. “I believe that those items are particularly alluring to both consumers and counterfeiters because they have reasonable price points that are attractive even at authentic retail,” she says. “It’s conceivable that consumers may believe that the counterfeit goods that they are purchasing are actually discounted authentic products. What many consumers may not know is that Tiffany does not discount its merchandise, so deals that appear too-good-to-be true probably are.”
Qunying Li is an IP professional who has written about the importance of enforcing IP rights at borders and now works as director of the IP division in the policy and laws and regulations department in China’s General Administration of Customs (GAC). He says that in most circumstances, consumers are aware that the goods they are buying are counterfeit.
He says: “However, consumers are addicted to purchasing and using counterfeit goods due to vanity and economic limitations. According to the economic principle that demand determines supply, the trade in counterfeit goods will never be stopped as long as consumers are willing to purchase and use counterfeit goods. Tis has been well proven by the drug trade.”
“But counterfeiters can be quite good at copying products, and in some instances, we see pretty
“ ALTHOUGH I BELIEVE THAT IT'S BASICALLY IMPOSSIBLE TO COMPLETELY ERADICATE COUNTERFEITS, THE PROBLEM IS ONE THAT CANNOT BE IGNORED. MOST BUSINESSES TEND TO LOOK AT THEIR LEGAL AND SECURITY/ INVESTIGATIONS DEPARTMENTS AS COST CENTRES, NOT PROFIT CENTRES. BRANDS NEED TO BUDGET ACCORDINGLY.”
good counterfeits,” says Abrams. “They’re certainly not indistinguishable, but they’re good. Counterfeit Tiffany products coming out of China can be quite deceiving to consumers. Consumers who order counterfeit Tiffany goods online may believe that they are buying quality products, but what they actually receive are poor quality products made from substandard materials.”
Fighting back
Counterfeiting is a global problem, meaning that China shouldn’t necessarily be singled out for the IP infringement occurring within its borders. Christopher Woods, a partner at Kilpatrick Townsend & Stockton LLP and the head of the China brands group in New York, says that China offers a suitable trademark law to deal with the problem and adequate legal remedies to enforce rights.
He says: “Te trademark law in China as it now is—it’s been amended two or three times—is as good as the trademark law pretty much anywhere in the world. Tere are perfectly adequate remedies. We’ve done a number of people’s court actions against infringers and the government itself, through its AIC [Administration of Industry and Commerce], does a lot of anti-counterfeiting work on behalf of brand owners.”
12 World Intellectual Property Review May/June 2011
“Te difficulty is the size of China and dealing with the enormous quantities of counterfeit or infringing goods that it produces,” says Woods. “Te volume really creates the problem. Te difficulty is the amount of money that it costs to have an enforcement programme that covers the whole of China. It’s really beyond even the largest corporations.”
Tackling the problem requires a strategy and a significant budget. China’s size is attractive to companies looking to establish brands there, but it’s a double-edged sword. Te geographical spread creates logistical issues and the presence of famous brands makes it a haven for would-be counterfeiters.
“If you have a good enough budget and you are focused on exactly who or what it is you’re trying to stop, you can make some pretty decent progress,” says Woods. “Where people make the mistake is trying to shut down small, inconsequential operations, rather than really investigating the key players in the key problem areas of China.”
An anti-counterfeiting strategy is integral to effectively dealing with the problem. A single, thinly spread solution will not yield any results. “Anti-counterfeiting is extremely challenging on a global scale and tackling the problem effectively requires a very strong strategy,” says Abrams.
www.worldipreview.com
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