Prada bag on eBay: $155. Same Prada bag on Prada Web site? $1,200. Rolex watch: $345 on eBay. Same watch on Rolex site? $14,700. Maybe the eBay sellers are trying to clean out closets and turn some unwanted items into cash, but, more likely, those are fakes. According to the International AntiCounterfeiting Coalition, counterfeiting has increased more than 10,000 percent in the last 20 years. Counterfeiting is the use of an identical but unauthorized trademark on the same type of goods the trademark owner normally sells, such as a Burberry plaid scarf made by someone other than Burberry.
Price, product and place: If you know the usual price range, can judge the quality of the product, and see that it’s sold from a place where you’d expect such items to be sold, you can probably guard against a fake. If the price is too good to be true, it is. If the hangtag has a misspelled word, or the eBay intro sounds like a third-grader wrote it, it’s probably fake. Your favorite college sports team sweatshirt bearing a hologram on its tag and sold in a sporting goods store is most likely genuine, but the hat on the gas station rack with no tag, not so much. If you get invited to a purse party, send your regrets. Those events, where discounted “designer” handbags and jewelry are offered in homes to friends along with a little wine and cheese, have had some gatecrashers lately. One Florida party ended with hostesses and guests in handcuffs and over $40,000 worth of seized goods. Fake luxury goods are often a funding source for more serious enterprises, especially narcotics, terrorism, prostitution and weapons trading. Go to happy hour instead.
What’s all the fuss over fakes? The answer is more complex than you might think. Of course buying a fake hurts the reputation of the luxury brand (particularly when you blame your slow “Rolex” for making you late, damaging the brand’s reputation). When you buy fakes, you’re essentially stealing from the goodwill of the real company. They’ve put money and effort into building their reputations, which are identified by their trademarks.
Also, the same organizations that make the fake purses and watches make fake drugs, lead toys and counterfeit airline and automotive parts. Fake Bake? Sure, I don’t want skin cancer. Fake brakes? No thanks. Here’s something scary: The FAA estimates that about 520,000 airline parts installed every year are counterfeit. And if you think outsourcing is bad for the economy, think about this: According to the IACC, counterfeiting costs U.S. businesses $200 billion to $250 billion every year and is directly responsible for the loss of more than 750,000 American jobs. You pay taxes, but counterfeiters don’t. They also don’t pay their employees fair wages or benefits, and often use forced child labor. Even if you’re just the purchaser of the fake handbag or DVD, if you’re around when a seizure occurs, you’re likely to have to return the merchandise (without a refund) and you may wind up needing legal counsel, which will cost you more than you saved by buying the fake purse instead of the real one.
Maybe it’s best to take the late Gilda Radner’s advice and base your fashion on what doesn’t itch.
Rachel Blue is an intellectual property lawyer with McAfee & Taft and a former trademark examining attorney with the U.S. Patent and Trademark Office.
This article appeared in the February 11, 2010 issue of The Journal Record. It is reproduced with permission from the publisher. © The Journal Record Publishing Co.