Recommended IP Reading: The Counterfeit Goods Complex

There was an interesting piece in this past weekend's New York Times Magazine describing how brazen, entrenched and sophisticated the infrastructure is for making copies of brand name merchandise.

The article, entitled "Inside the Knockofff-Tennis-Shoe Factory," provides a look at how counterfeit products of famous brands are ordered from and made at the manufacturing centers in the Putian area of China. Among other things, authorities indicate that this business is attractive to criminal enterprises because the sanctions if caught are much less than those for trafficking in illegal drugs.

The story also details the ups and downs of U.S. federal enforcement efforts:

In 1998, the National Security Council studied the impact of intellectual-­property crimes and concluded that federal law-enforcement efforts lacked coordination. An executive order soon followed, sketching out the role of the National Intellectual Property Rights Coordination Center. Two years later a makeshift office opened in Washington, but after 9/11, chasing counterfeit goods lost priority. Ballman said: "Resources and focus changed overnight. Agents were detailed elsewhere and moved away from thinking about I.P. to counterterrorism and weapons of mass destruction."

The Obama administration has made intellectual property more of a focus. "Our single greatest asset is the innovation and the ingenuity and creativity of the American people," President Obama said in a speech in March. "But it's only a competitive advantage if our companies know that someone else can't just steal that idea and duplicate it with cheaper inputs and labor." To implement his intellectual-property strategy, Obama appointed an intellectual-property-enforcement coordinator, while Immigration and Customs Enforcement invigorated the property-rights coordination center.

Can such efforts make a difference? "You're not going to arrest your way out of this," Bob Barchiesi, president of the International Anticounterfeiting Coalition, told me in a despairing tone this past spring. As long as there is a demand, he insisted, there will be supply. He had just returned from a trip to China, the point of origin for nearly 80 percent of all goods seized by Customs and Border Protection in the previous fiscal year. One day, Barchiesi observed a factory raid where counterfeit jeans were seized by the Chinese authorities. The factory, its employees and all its equipment remained in place. Barchiesi called the raid a "propaganda show."

So, it will remain to be seen if it is feasible to suppress the knockoff artists. However, there are a variety of business and legal reasons that make it important for owners of patents, trade secrets, trademarks and designs to police their rights and protect their intellectual property. These range from creating a credible deterrance threat to avoiding waiving ones' IP rights.

Contact Jeremy A. Gibson & Associates, PC if you believe your proprietary interests are being infringed. Our Chicago intellectual property lawyers can help assess your rights and develop and implement a prudent protection strategy. We are available to provide business law advice and representation in Chicago, Deerfield and throughout the region.