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Piracy and Counterfeiting Move to the Front Burner

1 Mar, 2012 By: Christopher S. Crook, Jeffrey D. Knowles, Venable LLP’s Advertising Response

Knowles and CrookThe early weeks of 2012 may go down in history as the great awakening to piracy and counterfeiting issues. However, the issues created by pirates and counterfeiters were not the topic du jour. Instead, the public and media focused on the issues created by those trying to stop counterfeiting.

The progress of the Stop Online Piracy Act (SOPA) and Protecting Intellectual Property Act (PIPA) through Congress sparked mass protests, with Google blacking out its logo on January 18, while thousands of other websites went “black” for 24 hours in protest. The next day, the Department of Justice and its counterparts in 22 countries coordinated raids to shut down file-sharing site, taking the site’s principals into custody.

President Barack Obama kept the media drumbeat rolling by addressing intellectual property infringement during his State of the Union address on Jan. 24 when he said, “Tonight, I’m announcing the creation of a Trade Enforcement Unit that will be charged with investigating unfair trade practices in countries like China. There will be more inspections to prevent counterfeit or unsafe goods from crossing our borders.”

Then, two days later, the European Union and 22 of its member states joined prior signatories Australia, Canada, Korea, Japan, New Zealand, Morocco, Singapore and the United States in signing the Anti-Counterfeiting Trade Agreement (ACTA). ACTA is intended to build an international legal framework for combating the proliferation of commercial-scale counterfeiting and piracy.

What does this all mean for the marketers and content producers attempting to protect intellectual property and those seeking to profit from the production of counterfeit goods or pirated content? It appears that, regardless of policy deliberations and speech pronouncements, the fight is far from over.

According to a recent Los Angeles Times story on counterfeiting, street markets offering brand name labels at low prices have flourished as consumers seek out brand name merchandise even as the economic downturn caused them to cut back on spending. “Of course they are not real, not at this price,” a shopper quoted in the story said. “But the quality isn’t bad and buying fakes saves a few bucks. You can find fake everything here.”

In today’s environment, marketers and content producers should take all available steps to protect their intellectual property. The first step is to secure patents and register copyrights and trademarks for your products. Once those protections are in place, marketers should vigorously monitor the brick-and-mortar and online marketplace for counterfeits. This monitoring can be conducted in-house or by third parties. When counterfeits are detected, the marketer should notify the appropriate law enforcement agencies and attempt to trace the counterfeit product back to its source.

Few people realize that patent holders, as well as holders of registered trademarks and copyrights, can also work with U.S. Customs & Border Protection (CPB) to stop counterfeits from entering the country. To take advantage of this program, the owner of the registered intellectual property must record patents, trademarks and/or copyrights with CPB. This registration makes information public about the marketer’s intellectual property rights. By providing details about the shipments and contents, marketers can help CPB agents seize similar shipments as they enter the country.

There are indications that programs like CPB’s can produce results for marketers. In a recent enforcement action dubbed Operation “Fake Sweep,” agents from CPB and the Department of Homeland Security’s Immigration and Customs Enforcement (ICE) seized more than $4.8 million in counterfeit National Football League merchandise in the four months leading up to the Super Bowl.

“Counterfeiting is a modern-day crime of global proportions, and selling counterfeit football jerseys is just the tip of the iceberg of intellectual property rights crime,” an ICE spokesperson told Yahoo! Sports in an interview. “Nearly any item that will turn a profit is subject to being counterfeited. Counterfeiters are pervasive, increasingly sophisticated, and a real threat to the U.S. economy.”

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