Intellectual Property & Counterfeiting

Counterfeiting conjures a rather specific image whenever it is brought up in conversation. Most would imagine some thugs hiding out in a dark basement where a heavy machine consistently prints out reams and reams of fake money. While this is the most notable example of counterfeiting, it is hardly the only example; intellectual property has had its fair share of trouble with counterfeiting as well.

Trademarks especially are subject to frequent counterfeiting attempts and there have actually been so many that the government has created an entire website dedicated to finding counterfeiters called www.stopfakes.gov (stylized as STOPfakes on their website). STOPfakes is a useful resource for consumers and business to discover counterfeited intellectual properties and the website offers many great resources in the battle against consumer fraud. Counterfeiting is, quite simply, when a fake product imitates a real product, generally while being of vastly inferior quality to the original. Counterfeit currency is worthless compared with real currency and counterfeit watches bought on the street in Mexico will break more easily than those sold from a reputable vendor. Counterfeit intellectual property, like trademarks, for instance, are similar to these in that they infringe on widely recognized trademarks in order to trick consumers into purchasing a low quality product. However, they differ in a few major ways; most notably trademark counterfeits have their own separate section in the legal code thanks to the Trademark Counterfeiting Act of 1984, which makes it a federal crime to knowingly counterfeit a trademark with severe punishments of a $250,000 fine and/or imprisonment for up to five years. Counterfeiting is an extremely serious crime and many companies lose countless millions in revenue every year due to counterfeit trademarks. The International Trademark Association even issued a statement where they claimed that trademark counterfeiting had become a 200 billion dollar industry .

While it is increasingly apparent that trademark counterfeiting is a huge problem, it’s surprisingly one that doesn’t receive much attention. Most of the articles written about this problem generally repeat basic assertions about what counterfeiting is and a few more advanced articles will talk about which companies it affects the most and discuss financial consequences, but outside of that, there is little talk of what sort of impact it has. Experts in the US automobile industry have asserted that they could collectively hire as many as 200,000 more employees if they didn’t have to compete with trademark counterfeiting. How accurate these numbers are is subject to scrutiny (they do seem to be wildly inflated and fact checking for this information is not readily available) but it does seem to illustrate a larger point that trademark counterfeit seems to hurt employment, an issue that should be striking a chord in an economy like this where the government increasing employment availability across the nation is considered to be a top priority. Perhaps the issue of trademark counterfeiting is seen to be too intellectual or too inaccessible for the average citizen to grasp, because it does at first seem to be a problem that only affects wealthy corporations. However, protecting these corporations from counterfeiting is one of the myriad ways in which the government can help the economy and increase employment opportunities. This truly is an issue that should have more widespread notoriety.

Kevin James
Intern at
JAFARI LAW GROUP®, INC.