Tag Archives: Gucci

‘Innocent’ IP theft is widely accepted and dangerously viral – Why?

So widespread is IP abuse that it no longer is regarded as a crime by many of the people committing it or authorities entrusted to preventing it. 

What has happened to change law-abiding citizens and honest businesses into serial patent, copyright and trademark infringers?

Start with geometric increases in information and speed. Putting enormous computing (and copying) power in the hands of billions of people and tens of thousands of businesses has made access seamless. What’s theirs often feels like mine, even when it is not.

26069006_sA heightened sense of entitlement is another factor. People want their Rolex or Gucci bag, or latest Adele song, and they want it now, for a fraction of the actual cost if not for free. (The same could be said of the latest mobile phone chip.)

Many businesses believe that even if they did not invent a particular product feature, they definitely could have, and why should they pay for it if no one is forcing them to. Besides, someone has to identify infringement and prove it in court. Good luck with that.

Unusual Bond

Consumers and companies have an unusual bond: they know that they can freely infringe without much fear of retribution. And you know what, they think — “everyone seems to be doing it lately.”

A third but not final reason is suspicion of IP rights and owners. Patents, copyrights, trademarks all are government-issued, lawyer-administered and business-owned rights. The average person will never own an IP right and believes that benefiting from them is for the privileged or wealthy. They are only partially right. No one – not the lawmakers, not federal agencies, not the police, the schools or businesses or community leaders – has done a very good job of explaining what’s in IP for them?

Fueling the Rise in IP Abuse

“When theft is no crime” in the March IAM magazine, the Intangible Investor looks at the rise in IP abuse and what is fueling it. IAM subscribers can go here for the full article.

Free riding comes in many shapes and sizes. It is economically a threat and constantly growing. It has become so much a part of American fabric that millions of people, businesses and community leaders are not even aware that it is taking place. IP theft may seem like a victimless crime, but data shows it is not.

The Department of Commerce’s 2016 update, Intellectual Property and the US Economyreports that IP-intensive industries supported 45.5 million jobs and contributed $6.6 trillion in value added, equivalent to free-riding-final-2-768x34638.2% of US gross domestic product. These impressive results for IP holders are far from guaranteed if IP protections can be easily ignored. On the down side counterfeits, patent infringement music file sharing are way up.

Re-writing the Rules

Whether they acknowledge it or not, some companies and individuals are attempting to rewrite the property rule-book, or, at least, ignore it as long as they can. The impact may not be that readily apparent at first, but it will eventually be widely felt: by musicians, authors, inventors, investors, small businesses, consumers and companies selling products from automobile brake parts to pharmaceuticals and luxury goods – along with their employees. 

Lack of awareness plays a role in ignoring IP rights, but there may be something deeper and more insidious going on: distrust of authority and frustration with government and laws. Some of this anger has been orchestrated by anti-patent lobbyists.

Routine acceptance of IP theft also reflects the growing antipathy towards so-called ‘elites’, which led to Brexit and the election of Donald Trump. Why IP holders don’t deserve exclusivity and land owners do is rooted in how the culture views IP rights and holders, as much as the difficulty accepting their value.

People need to be reminded that with IP rights, not every restriction is an obstacle.

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I will be announcing a non-profit organization in a few weeks dedicated to addressing the lack of IP awareness and increasing hostility to rights. Watch IP CloseUp for more information.

Image source: digitalguardian.com; theCenterforIPUnderstanding

 

Bill Introduced to Criminalize Purchase of Counterfeits in NYC

Legislation would make NY the first U.S. city to prosecute buyers of fake goods with jail terms of up to one year.

The New York City Council has introduced a bill to make the purchase of counterfeit goods a crime punishable by a fine of up to $1,000 and as much as a year in jail, which would make buying a fake Rolex watch a Class A misdemeanor.

The most stringent punishments would be applicable to people who buy in bulk, often to resell to friends back home, said NYC Councilwoman Margaret Chin, who introduced the legislation. In those particular situations it is difficult to argue that buyers merely got lost on the way to purchase authentic products. Chin’s district, which is comprised of lower Manhattan includes Chinatown, as well as flagship stores for Gucci, Prada, Louis Vuitton, Rolex and other luxury brands.

Golden Rule 

Teaching respect for others’ intellectual property should be the Golden Rule of the digital age. It does not matter if the property is intangible, like copyrights on recordings, or patents that cover inventions, ideas and creative output are not there for the taking. Real estate lines are clear cut; not so with the rights to intangible assets. Some consumers may require help understanding how brands work and the importance of upholding a trademark, but many would rather remain uninformed.

luxury_brandsPeople can be taught the importance of respect for other people’s’ property not only because IP theft violates the law, but because it has serious implications for American jobs and businesses. When items such as pharmaceuticals and air plane parts can be counterfeited, there can be life-threatening consequences, too. 

The speed and accessibility of information makes it feel as if everything is within the tap of a smart phone or click of a mouse. But because images and content (and inventions) are easier to access does not mean that they are up for grabs. Lines of demarcation need to be more clearly delineated and consistently enforced.

A hefty fine or jail term for buying counterfeit goods may seem harsh, but that’s only because we’ve gotten used to accepting IP crimes as business as usual. Many believe that IP is a basic right, like air and water. It is not. Just as a “John” enables prostitution, in the eyes of the law and is in part responsible for it and criminally liable.  Similarly, those who buy counterfeit goods must be held accountable for their actions. Pleading ignorance is a sorry excuse. Parents, schools, and law enforcement agencies, need to do a better job of educating audiences about IP rights.

IP Theft is a Serious Problem

It is difficult to determine whether or not consumers who buy products from companies that violate other business’ patents are breaking the law. The fact remains that invention theft by technology companies is rampant. If more consumers were aware of the problem and its impact, they may care enough to do the right thing and encourage others to. (Awareness of child labor in developing nations has changed attitudes if not consumer preferences.) Consumers, not just the courts, are responsible for reinforcing good business  behavior.

Trademark, copyright and trade secrets are all protected to some extent under criminal law. If the counterfeit legislation is voted in, those who participate in brand or trademark counterfeits in NY will be subject to much harsher treatment than in the past. Patent violators escape criminal penalties, in part because infringement can be unintentional and wilfulness very difficult to prove. It will be interesting to see under what conditions criminal penalties for patent violators will become viable.

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Councilwoman Chin said at a public hearing that counterfeits deprive the city of at least $1 billion in tax revenue annually that could otherwise support community improvements. The Democratic lawmaker expects a vote sometime in the coming months.

France already has the toughest counterfeit law.In France, everyone seems to know that buying or carrying fakes is a crime,” says Valerie rolex-watchesSalembier, a former publisher of Harper’s Bazaar magazine who planned to testify at the NYC Council hearing. She runs the nonprofit Authentics Foundation dedicated to consumer education of the counterfeit industry. Air France warns tourists to stay away from fake goods, because anyone in the country risks fines of up to 300,000 euros’ (more than $478,000 USD), and up to three years in prison for the mere possession of a counterfeit item.

‘‘It’s why they don’t have a big problem with counterfeits in France,” Salembier says.

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“Protecting the trademark of manufacturers is in the city’s interest and the country’s interest, otherwise people wouldn’t come here and sell things and create things,” Mayor Michael Bloomberg told reporters during an appearance in the Bronx.

Image source: counterfeitchic.com; beingdutchinasia.com; http://ryklim.wordpress.com/ 


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