The Battle With Online Counterfeiting

April 14, 2011 § 1 Comment

The discussion over whether or not search engines should be responsible for promoting websites that sell counterfeit products remains a heated debate.  A recent article in PC World summarizes a hearing last week about digital piracy. To date, Google has shut down about 50,000 accounts for attempting to use their Google Adword program to promote counterfeit goods. The hosting site Go Daddy has been shutting down all sites that have any sort of infringing content.

Kent Walker, senior vice president and general counsel at Google spoke about their fight against fakes:

“Google does bury the search results of sites that sell pirated or counterfeit products after complaints from copyright holders…But it’s difficult to filter Web searches ahead of time because searches for legal sites are often similar to searches for piracy or counterfeit sites, and Google doesn’t want to be in the position of deciding what sites should be excluded from search results.”

Nonetheless, Google is certainly taking the necessary precautions to protect the public from ads for counterfeit goods (see our recent blog post), but the question still remains if search engines should be held liable. Walker stated that lawmakers should focus on the advertising and financial transactions that pay for the websites selling counterfeits instead of focusing on search results.

In order to control the online counterfeit industry, companies and government agencies should work together. Google should do what they can to delete infringing accounts and hide search results for counterfeit sites. Brands should monitor the internet and work with prosecutors in shutting down websites selling counterfeits of their products. Hosting sites should shut down any sites that are infringing. Lastly, prosecutors and lawmakers should work with all parties in order to hinder counterfeiting online. Battling online counterfeits should be a global group effort in order to prevent criminals from selling fakes.


Holograms Continue To Play A Role In Anti-Counterfeiting

April 6, 2011 § Leave a comment

We are hearing more and more about the pharmaceutical industry using holograms for better anti-counterfeiting protection. According to a recent article put forth by The International Hologram Manufacturers’ Assn., the World Health Organization has estimated that annual earnings from the global sales of counterfeit and substandard medicines exceed $32 billion. This pushes the pharmaceutical industry to fight even harder against counterfeits.

Brands are not only using the holograms as a flashy point-of-sale, but they are going a step further providing authentication through the use of holograms as well as putting forth track-and-trace systems. These systems trace the product from its source as well as where it has been and where it is going to prove that the medication or product is authentic. This initiative requires all registered medicines, OTC pharmaceuticals, and traditional medicines to carry a uniquely numbered label built around a hologram.

The article makes a great point that all brands should consider:

Pharmaceutical companies and organizations involved in successful anti-counterfeiting efforts also recognize that it should not be the sole responsibility of the consumer to examine a hologram to check that the product is genuine. Rather than rely on untrained members of the public to identify counterfeits, it must be the primary responsibility of manufacturers and the enforcement agencies to ensure that fake pharmaceuticals should not be able to enter the legitimate supply chain in the first place.

A consumer should be able to go to their local pharmacy or drug store and trust that their Colgate toothpaste or diabetic medication is legitimate. In America, there are many that have that luxury, but in other countries, that just isn’t the case. Brands should do all that they can to protect the consumer and pharmacies should take the necessary precautions to make sure that their suppliers are trustworthy sources of medication. As a consumer, the best you can do is buy from a trusted pharmacy. Do not buy medication or supplements online unless you are sure it is an authorized reseller of the brand.

Luxury Brands Take Action Against Local Businesses

March 30, 2011 § 1 Comment

Luxury brands, especially Louis Vuitton, have been taking action against counterfeits since the 1800s. In a recent lawsuit, Coach Inc. is taking action against two local businesses in North Carolina for selling counterfeit products. Local authorities received complaints about Hair Villa Salon in Fayetteville due to the fact that they were promoting the availability of counterfeit goods. Secondly, retail boutique Clothing and Such Warehouse was found to be in trademark violation as well, when visited by an undercover agent. According to a recent article, Coach is seeking up to $2 million in damages from the claims for breach to its trademark.

(Image taken from article)

Louis Vuitton and Burberry are also currently seeking damages for breach of trademark and copyright against a Canadian fashion company. The two luxury brands are seeking up to $3 million in damages. Lawyer Michael Manson told Canadian courts earlier this month that this ruling could be the largest anti-counterfeiting judgment in Canadian history.

As luxury brands continue to crackdown on businesses, locals are starting to speak up. Both businesses involved in the Coach Inc. case were brought to the authorities attention through filed complaints. They best thing you can do to help fight fakes is to say something. If you see a store or salon selling a fake, report it.

Google Responds To Counterfeit Ads

March 22, 2011 § Leave a comment

Last week, in response to the Google Ad controversy, Google addressed the issue of counterfeit paid search advertisements on their blog. As something we recently covered on our own blog and a topic many of you have approached us about, we wanted to share their information with you.

According to Google Public Policy blog, Google seems to have stepped up their game in taking down ads promoting counterfeits. Google calls tracking down these bad ads a “cat-and-mouse game” because there are over 190 million advertisers using Google AdWords in over 190 countries. Google recognizes that these types of ads are not only bad for brands, but bad for THEIR brand. One blogger commented to us that after noticing GoogleAds on their blog promoting counterfeits, they discontinued the service.

The blog outlines Google’s most recent efforts to combat counterfeits:

  • We’ll act on reliable AdWords counterfeit complaints within 24 hours. In 2009, we announced a new complaint form to make it fast and easy for brand owners to notify us of misuse. For brand owners who use this form responsibly, we’ll reduce our average response time to 24 hours or less.
  • We will improve our AdSense anti-counterfeit reviews. We have always prohibited our AdSense partners from placing Google ads on sites that include or link to sales of counterfeit goods. We will work more closely with brand owners to identify infringers and, when appropriate, expel them from the AdSense programme.
  • We’ve introduced a new help center page for reporting counterfeits. That way, we aim to make it easier for users and brand owners to find forms to report abuse.

We’re glad to see Google taking action and investing in stopping counterfeiters from placing ads on Google AdWords. As a consumer and an online shopper, the best way we can help Google and stop criminals is to report these types of advertisements to the Google team and hope they do their part.

What do you think? In reading their new approach, is Google is doing enough to tackle counterfeit ads?

China Takes Charge; Arrests Over 3,000

March 17, 2011 § 1 Comment

CHINA HAS A BAD REPUTATION AS BEING ONE OF THE leading sources in counterfeit manufacturing. Everything from counterfeit clothes to fake pharmaceuticals and electronics have been sourced from China. Starting last October, Chinese authorities began the largest crackdown the country has seen in a very long time. From seizures of counterfeit products to thousands of arrests, police and customs officials are taking no prisoners.

(Image taken from here)

According to a recent Fox News article, Chinese authorities have arrested over 3,000 people and shut down 292 websites selling counterfeit and fake goods. They expect these numbers to continue to rise. The American Chamber of Commerce in China says 70 percent of its member companies consider Beijing’s enforcement of patents, trademarks and copyrights ineffective. The article also mentions that rampant copying has hampered Beijing’s efforts to attract technology industries because businesspeople say companies are reluctant to do high-level research in China or bring in advanced designs for fear of theft. The Chinese are fully aware of their reputation regarding the fake trade, but law enforcement has promised the public that their current anti-counterfeiting campaign will continue to grow, produce lasting results and reduce the number of criminals.

Hopefully this latest campaign will push China away from being one of the top producers of counterfeit products and establish the country as a more reputable source for manufacturing and for doing business in general.

New York Post Goes Undercover To Expose NYC Counterfeits

March 16, 2011 § Leave a comment

JOHN CRUDELE’S COLUMN OF THE NEW YORK POST TODAY IS AN INTERESTING recap of a recent undercover investigation into the counterfeit industry in New York City. The Post hired a spy to go underground into the warehouses and supply chain of the fake trade in our own backyard.

The undercover agent found tons of fake clothes, handbags and sneakers. He even overheard conversations between wholesalers and customers “talking about how much they liked these enemies of the US.” One man said he liked Hezbollah, the Middle East terrorist organization. It has become increasingly evident that the sales from counterfeits fund terrorist acts. In a recent FANIF blog post, we referenced an article about a man who was charged for selling counterfeits in order to raise funds for this same group.

The Post started the investigation to show consumers all the millions of tax dollars that were being taken away from the city, but uncovered a much deeper issue. Crudele was left wondering, what percentage of the sales from counterfeits ends up in the hands of those wishing to do harm to the U.S.? The problem is not just in New York City. Globally, counterfeiters are using funds for criminal activities, especially for terrorist organizations.

To check out the full video of what The Post spy found, click here.

Google: A Gateway For Criminals?

March 5, 2011 § 3 Comments

This week we came across several articles and Facebook posts from our followers about online advertisements promoting counterfeit products. The problem with these advertisements, beside the fact that they promote counterfeits, is that they are not monitored or regulated. A recent article cited Rosetta Stone, the language instruction software company, demanding that Google be held liable for presenting paid search ads that link to counterfeit sites. Rosetta Stone has had problems with those specific ads using their trademarked name “Rosetta Stone” and linking to a site selling counterfeit software.

Below is an example of an ad recently shared with us by one of our Facebook fans. When the advertisement is clicked, it brings you to the obviously fake site selling discount designer products.

The main question is, should search engines like Google be responsible and held liable for paid search ads on their site? We asked our Facebook and Twitter fans:

  • “If you’re not part of the solution then you’re part of the problem. Perpetuating the advert of such sites = enabling the practice”
  • “They need to check out everyone they allow to advertise. Called quality control. Everyone pitch in!”
  • “Tricky.”
  • “Yes, Google and Facebook should both be held liable.”

Many brands are struggling with counterfeiters using their trademarked brand name or logo in their online advertisements to lure in consumers. This is a trademark infringement and something companies like Rosetta Stone are taking up with the government. Senator Judiciary Chairman Patrick Leahy prepares to reintroduce the Combating Online Infringements and Counterfeits Act and I am sure many brands will be interested in amending that bill to include liability of search engines.