Websites Selling Counterfeit Goods Shut Down

photo - trade secrets verdictsThe sale of counterfeit goods results in the theft of business from companies who legally sell their goods. Counterfeiters copy a wide range of products and either use their own labels or copy the brand of the rightful owner and profit from the work of others. One way these sales are made is through websites which are coming under more scrutiny by law enforcement.

Last Cyber Monday (the Monday after Thanksgiving) police authorities across the globe, spearheaded by the U.S. Customs and Border Protection Service (USCBPS), closed down 37,479 websites believed to be selling bootleg products. In addition to U.S. authorities, Europol and 27 Interpol countries cooperated in the effort (including Thailand, China and Argentina who are new to the effort) according to the International Business Times.

About 7-8% of world trade each year involves counterfeit goods, according to federal government website STOPfakes.gov. That may come to as much as $512 billion in global lost sales. U.S. companies are out between $200 billion and $250 billion due to the sale of counterfeits.

USCBPS states in fiscal 2010 nearly 20,000 seizures of counterfeit and pirated goods occurred, with a value of $188.1 million and a manufacturer’s suggested retail price of $1.4 billion. Areas of the economy that are the most impacted are manufacturing, consumer goods, technology, software and biotechnology including pharmaceuticals.

The Cyber Monday website takedowns targeted those peddling bootleg consumer electronics, headphones, cell phones, name brand apparel, handbags, cosmetics, sports apparel and other goods that are normally big sellers on Cyber Monday. The shutting down of the websites, the sixth largest of its kind, included those deceiving customers by advertising Beats headphones at a sharp discount, for example, and shipping out cheap knock offs that don’t have the same quality as the originals. Cyber Monday takedowns involved 292 counterfeiters in December 2014 and 690 in 2013.

When on these types of websites customers may have what appears to be a normal shopping experience on a known brand’s website, then see the difference at check out when it appears the payment page isn’t what it should be. An ABC News story shows how difficult it may be to tell the difference between a legitimate website selling genuine goods and a bogus website selling pirated goods.

  • Counterfeiters use websites that mirror real company sites.
  • In addition to fake luxury handbags or watches website users can buy fake pharmaceuticals and software from these websites.
  • Some phony websites have more pictures and products for sale and may be more elaborate than the websites of genuine companies.

Examples of genuine websites and knock offs are below.

Which are the genuine Beats by Dr. Dre and Rosetta Stone websites and which ones are the counterfeits? Both counterfeits are on the right.

Small businesses that export IP protected products or obtains its products or parts overseas need to consider the potential for IP theft in other countries, warns STOPfakes.gov. Small companies are at risk because they often lack the knowledge, expertise or resources needed to prevent the theft of their ideas and products. Only 15% of small businesses doing business outside the U.S. know that they need to file for IP protection abroad according to research by the U.S. Patent and Trademark Office. The website offers a business tools page to help educate small businesses on IP protections.

If you want to learn more about IP protections for your business contact our office so we can talk about your products and what steps can be taken to prevent lost sales to counterfeiters.