Tag Archives: Counterfeiting & Piracy

China fakes reform

Originally posted 2008-06-18 10:51:15. Republished by Blog Post Promoter

On the eve of the Beijing Olympics — which is nothing if not a branding, merchandising and licensing bonanza to which athletes are invited — a nervous Chinese government official writes in the Wall Street Journal that that the era of Chinese counterfeiting is about to end, actually, and here’s why:

How will we do this? In the following four ways:

  • First, we will make timely revisions to IPR legislation, including the laws on patent, trademark and copyright, as well as regulations on their implementation. We will also bring forward legislation in the areas of hereditary resources, traditional lore, folk arts and geographical marks so as to improve the overall framework for IPR law enforcement and management.
  • Second, we will speed up the revision of laws and regulations on punishment of IPR infringements, and strengthen the systems of judicial protection and administrative law enforcement. We will mainly rely on judicial protection for protecting intellectual property rights. We will mete out more severe penalties, reduce the cost of IPR protection, and deter violation by raising its cost.
  • Third, we will properly define the scope of intellectual property rights to prevent their abuse, ensure a level playing field, and protect the lawful rights and interests of the public. We will ensure a better mesh of our IPR policy with those of culture, education, scientific research and public health to uphold people’s rights to properly use the information and fruits of innovation in ways permitted by law in their activities in culture, education, scientific research and health, and make sure that innovation achievements are shared more equitably.
  • And finally, we will launch extensive educational programs among the public to further encourage innovation, promote such moral standards as honesty and credibility, and condemn plagiarism, piracy and counterfeiting. We will raise people’s IPR awareness and foster an innovation-friendly IPR culture in which knowledge and integrity are respected, and laws and regulations are complied with.

Still with us? A lot of chin music, really. An hour later and we again feel hungry. Why?

One would think that a totalitarian regime would have no trouble implementing policies such as these. They are just rules, after all. The problem is that China has opened to free enterprise, but it has not opened to the rule of law.

Free enterprise plus political repression — reliance on coercion throughout legal, administrative and social institutions — will not, in the long run, work in a large economy.  And in the short run, at least, the result is endemic corruption. Read More…

Starting ‘em out young

Originally posted 2007-02-11 19:43:15. Republished by Blog Post Promoter

Counterfeit Chic looks at tomorrow’s counterfeiters. Well, that’s how Susan looks at them, anyway. When you’re a carpenter everything looks like a nail, you know?

Bringing big IP plaintiffs down a peg — or two

Originally posted 2007-06-01 01:13:36. Republished by Blog Post Promoter

Mike Atkins is paying attention to Microsoft’s IP docket, as a Seattle Trademark Lawyer will do. He’s reporting about a default judgment and award the software maker achieved in California, with a rather surprising anticlimax in the dollars-and-cents category:

Microsoft sought more than $3 million in statutory damages. However, the court only awarded $12,500 in damages and $2,000 in fees and costs. The court explained its decision by stating: “Plaintiff asks for the maximum enhanced statutory damages for the infringement of each of seven copyrights and two trademarks. At $150,000 per copyright and $1,000,000 per counterfeit trademark, the tab comes to $2,050,000. Plaintiff has identified a grand total of three units of counterfeit software that defendant sold. It is true that Microsoft could not conduct discovery to determine its damages, but that in itself does not support levying a statutory damages award in excess of three million dollars. … Statutory damages are intended to serve as a deterrent, but that does not justify such a windfall.

Well. True enough, when we got the judgment for seven (theoretical) figures in Louis Vuitton v. Veit, which was a counterfeiting case (and thus also implicated statutory damages), we could point to a major online counterfeiting operation, from which the court could deduce not only massive sales but the sort of massive wrongdoing that those huge swinging statutory damage options are meant to punish. Even then the court wanted as much proof as we could get our hands on of what was going on there.

But only $2,000 in fees and costs? That doesn’t sound right. The attorneys’ fees provisions of the Copyright Act are supposed to make a successful plaintiff at least whole in terms of the cost of enforcement — regardless of the number of units sold. Two thousand dollars doesn’t even cover scribes and sealing wax.

Sounds like something else was going on here. Any suggestions?

… and Europe Strikes Back: Google Loss Upheld by French Court

Originally posted 2005-03-17 21:11:00. Republished by Blog Post Promoter

A friend painfully close to the case forwarded this link reporting that Google has lost its appeal of a judgment for “trademark counterfeiting” against the French travel companies Luteciel and Viaticum:


A French appeals court upheld a ruling against Google’s advertising policy in a decision published Wednesday, ordering the Internet search engine to pay 75,000 euros in damages to two companies whose trademarks it infringed.

The court found that Google was guilty [sic] of “trademark counterfeiting” and ordered it to pay the damages originally awarded to French travel companies Luteciel and Viaticum, as well as costs.

(Why “sic“? Because in civil cases, there is no such thing as “guilt” — only findings of liability or non-liability. Even in Europe. Even in France. I felt you should know that.)

Here are some key points in the decision, translated rather clumsily on the site linked to above:

  • “[I]t is necessary to point out that its liability is only sought with regards to the second capacity and this capacity alone” In other words, this is solely an issue of secondary, i.e., contributory, trademark infringement.
  • “Considering that no circumstances of force majeure existed that may exempt it from liability, where and insofar as it is proved that two other service providers in the field of paid positioning, the companies OVERTURE and ESPOTTING were faced with the same problem and managed to resolve it promptly and that GOOGLE FRANCE also managed to do so, although with some delay” This again goes to the killer point that middleman-type providers have here: The claim that “we can’t police the whole world” is (a) not credible when others do and when (b) you manage to do it when you really, really, really have to and (c) you’re making a mint.
  • “Considering that . . . GOOGLE FRANCE, even if it had legitimately not been aware that the companies were the holders of the contentious marks, could not offer the purchase of the words ‘bourse aux voyages’ or ‘bourse de voyages’ or even ‘bdv com’ in its keyword suggestion tool, on the pretext that they were high among the most often requested key words, without carrying out a serious study of the potential rights of third parties over these words ” It’s not only a matter of what the U.S. courts call “willfull blindness” (which can result in a third party such as an auction site or a flea market being held contributorily liable for infringement) — there’s evidently an affirmative duty on the part of providers of services such as Google to inquire, at least under certain facts, if there are trademark issues.

No, this is not the applicable law in the U.S., but it matters for a few reasons. One is that the factual findings here will undoubtedly influence Google’s posture in future U.S. litigation. Another is that Google will have to make changes in the way it does business — which it already has begun to do, anyway — and this will affect both its overall service platform and its ability to say what it can, can’t, will and won’t do in the U.S. And the other is that, as is well known, there’s really no such thing as U.S. law, anyway. (And in a Googled-up, wired-up, hyperlinked world, isn’t that really what we all want?)

Okay, that might be bit much. But then, evidently, was Google’s share price in early February. Buying opportunity tomorrow, gang! I’m riding the stock all the way — when you got a position like I do (ten shares), you don’t want to go and panic the market…

UPDATE:  From Reuters “news” service, March 2010:

The European Court of Justice (ECJ) said on Tuesday advertisers were free to buy keywords identical to trademarks of rivals as long as consumers were not confused on the provenance of goods and services by the way ads were displayed online.

The court said that in cases where ads could confuse consumers, brand owners should invoke their rights against the advertisers concerned, not against Google — unless Google failed to act on a complaint or actively manipulated keywords.

Jihadi Faux?

Originally posted 2006-04-07 12:39:52. Republished by Blog Post Promoter

Counterfeit Chic reports that the world really does revolve around intellectual property!

Last week in Maryland, a traffic stop yielded a cache of counterfeit Nike sneakers, LV and Coach handbags, additional illegal merchandise — and a CD titled “Jihad Freedom for the Slaves.”

OK, well. As Susan says, “Not dispositive, but at least suspicious.”

Cardiac counterfeiting

Originally posted 2008-04-29 02:54:51. Republished by Blog Post Promoter

It’s not a defense to trademark infringement or counterfeiting that your heart is full of good intentions.


Originally posted 2006-07-31 11:35:07. Republished by Blog Post Promoter

PirateMarketplace from PBS recounts a confused phone interview with a bona fide trademark pirate. Aargh.

(Three-cornered — or is it a coolie? — hat tip to Bill Heinze.)

RIAA: Pillar of the Plaintiff’s Bar

Originally posted 2005-12-15 18:37:23. Republished by Blog Post Promoter

Reuters “news service” “reports”:

A record industry trade group on Thursday said it filed lawsuits against 751 people it claims used online file-sharing networks to illegally trade in copyrighted songs.

Among those targeted in the suits are students at Drexel University, Harvard University, and the University of Southern California, the Record Industry Association of America (RIAA) said in a statement.

You have to give them credit for sticking with their strategery, no matter how inneffectual. It’s outside counsel’s dream come true…

Defining counterfeiting downward

Originally posted 2009-11-12 13:32:16. Republished by Blog Post Promoter

Some fakes are worse than others

Some fakes are worse than others

Counterfeit Chic happens upon a new defense to trademark counterfeiting:  “Counterfeiting?  You call this counterfeiting?!”

We’ve all seen imitation goods so poorly rendered that they wouldnt fool a myopic Martian on a dark night.  And there must be a market out there beyond mere video fiction, or LV look-alikes wouldnt keep showing up on shady street corners and in dark corners of the internet, next to the “Prado” and “Channel” bags.  But why would any self-respecting counterfeiter turn out such bad fakes?

It turns out there’s method to the madness.  In theory, these inept imitations could allow a manufacturer/importer/seller to avoid liability under the rationale that there’s no likelihood of consumer confusion.  In practice, however, courts dont like apparent bad actors.

Or have all that much interest in things like likelihood of consumer confusion, actually.  In practice.

On the other hand, as much as I rail against that judicial trend around here, when it comes to trademark counterfeiting I don’t have a big problem with it; it’s nearly a per se, strict liability tort, and that’s what it is.  I certainly wouldn’t want to live in a world where sloppy work is anything other than its own reward, after all.

From Russia, without royalties

Originally posted 2007-07-17 22:59:01. Republished by Blog Post Promoter


"For Distinguished Services for the Motherland"

The Kalashnikov rifle: Naked trademark licensing (“I take them into my hands and, my goodness, the marks are foreign,” [General Kalashnikov] said of the knockoffs the Soviet Union once championed. “Yes, they look alike.  But as to reliability and durability — they do not meet the high standards of our military” at its bloodiest).

UPDATE: Much more, and done better, here. Also a good piece about the man and the weapon here and here*.

NEW AND IMPROVED KILLING POWER:  The AK-47 (i.e., the Avtomat Kalashnikov 47 — does that mean you could buy one here?) as “Most Important Weapon Ever” (via Instapundit).

*”A unique design feature of the AK-74 . . . is an air-space (about 5mm long) inside the jacket at the bullet’s tip. . . [T]he air-space does serve to shift the bullet’s centre of mass toward the rear, possibly contributing to its very early yaw. This shift of lead occurs asymmetrically and may be one reason for the peculiar curvature of this bullet’s path in the last half of its path through tissue. Only in a shot with a long tissue path, like an oblique shot through the torso, would this curved path be evident; it doesn’t really add anything to wounding capacity, but might cause an occasional confusing path through tissue.”

Home cookin’ a la mode, with a most undeserving dessert

Originally posted 2008-07-01 02:15:56. Republished by Blog Post Promoter

From the WSJ Law Blog:

A French court today cracked down on counterfeits — and an outlet that sells them — ordering eBay to pay Louis Vuitton and other luxury brands — Kenzo, Guerlain, Dior and Givenchy — $63.1 million in damages for auctioning fake goods. Here’s the early story from WSJ. . . .

“I was really surprised by the number,” J. Michael Huget, the head of IP at Butzel Long, told the Law Blog. “There’s definitely a hometown flavor to it. I don’t know how you get there on a disgorgement of profit basis, unless there’s some unique penalty provision that exists under French law. But even with that, it’s not like it’s a company that’s gone over there and hurt people. You don’t want to discount the value of a brand, but that’d be a huge number even in our system.”

Well, unless there’s some, like, Frenchie legal reason for it, yeah? I’d run that down. Genuine expertise demonstrated by Butzel Long, and crack reporting there by the WSJ! I blame the reporter more than I do Michael Huget. Wouldn’t want to have to dial another number and risk finding out that law part.

On the other hand… “it’s not like it’s a company that’s gone over there and hurt people”? Oh, is that the test, then, given what we… know? … about French law? Remember, Michael, what our teeny dollars look like to Europeans!

Oh, all right. It does sound like a huge number. Yet on the other hand — hometown-wise, frankly I couldn’t blame the French (yes, I did just write that) for getting the impression that there’s only one way to get eBay’s attention?

Having said all that — this is actually really troubling:

As for perfumer-plaintiffs Kenzo, Guerlain, Dior and Givenchy, the judge ruled that, even though the perfumes sold by eBay were legitimate, the company was liable for unauthorized sales. LVMH strictly limits their distribution to authorized dealers such as perfume chains and department stores.

Oh no. No!!!!!!  Now what do I do?!

(Jaunty beret-tip to Marty.)

Ninth Circuit: eBay not a portal to jurisdiction

Originally posted 2008-09-17 23:59:34. Republished by Blog Post Promoter

We spill a lot of pixels here blogging about the question of just how transparent, nay ethereal, eBay is as, say, a facilitator of transactions premised on trademark and copyright infringement, such as the sale of counterfeit goods.  Regular readers know we’re somewhat wed to the suggestion that eBay knows enough, makes enough and controls enough to render it at least theoretically liable for third-party infringement. 

So far, no court has agreed.  Fine.  That’s as far as substantive law.  But how about procedural law?

Well, procedural law that implicates due process rights — particularly the issue of a court’s assertion of personal jurisdiction over a non-resident — has been known to look a lot like substantive law.  And vice versa.  Still and all, it’s interesting to see that eBay’s virtual lightness of being continues to move courts its way.   Now, Evan Brown reports, the Ninth Circuit tells us that eBay, as intermediary and market-maker of a single arguably actionable transaction, cannot suffice as the fulcrum of a claim of personal jurisdiction.

Now as Evan points out, most cases discussing the existence or lack of existence of personal jurisdiction are kind of boring.  In contrast, Boschetto v. Hansing, he assures us, is the jurisprudential equivalent of rock and roll, chili peppers and Derek Jeter:

What makes this case worth noting . . . is the court’s rejection of Boschetto’s argument that the eBay component of the deal defined the analysis. Boschetto had argued that the eBay listing would have been viewed by anyone in California, thus that functionality supported an exercise of personal jurisdiction.

But “the issue [was] not whether the court [had] personal jurisdiction over the intermediary eBay but whether it [had] personal jurisdiction over an individual who conducted business over eBay.” The court noted that in other Internet-related personal jurisdiction cases, like Cybersell, Inc. v. Cybersell, Inc., 130 F.3d 414 (9th Cir. 1997) and the famous case of Zippo Mfg. Co. v. Zippo Dot Com, 952 F.Supp. 1119 (W.D.Pa. 1997), the interactive nature of the websites had jurisdictional significance because they permitted the defendants to maintain ongoing contact with the forum.

An isolated sale on eBay, however, is different in nature. In this case, the court found that the eBay aspect was “a distraction from the core issue.” The use of eBay was to facilitate a one time contract that created no substantial connection with or ongoing obligations in the forum state.

This is not to say that the use of eBay could never give rise to personal jurisdiction outside a defendant’s home forum. A number of cases have so held. See, e.g., Dedvukaj v. Maloney. The court noted that where eBay is used as a means for establishing regular business with a remote forum, the traditional notions of fair play and substantial justice might provide for the exercise of personal jurisdiction. But this was not one of those cases.

We hate to admit it, but sometimes even the Ninth Circuit is right… and sometimes even eBay not being pegged with liability for evildoing across its intertubes is right… and mostly Evan Brown is right… and this is one of those cases!