Counterfeiting

By some estimates, the cost to legitimate brands from counterfeiting is $1.8 Trillion annually. The cost of this intellectual property theft to American companies has been estimated at $600 Billion annually. Small Business owners are increasingly seeing their products knocked-off and sold on e-commerce platforms.

If you are a small business owner, it’s important to take the issue of counterfeiting seriously. Federal law provides remedies for victims. For example, if your registered trademark is violated — the remedy can be up to $150,000 per infringement. Courts can also order a defendant to pay your attorney’s fees; and pay punitive damages etc.

If your company is a victim of counterfeiting, a business lawyer can help you understand your rights; and notify the proper authorities. Your lawyer will then likely connect you with a litigator. While it can be challenging to collect money from foreign manufacturers, plaintiffs may sue the US retailers and web-sites that facilitated the crime. Think about it: E-commerce billionaires, their employees and investors are profiting from the sale of counterfeit goods on their websites. Is that fair?

While buying counterfeit goods is not considered a crime, re-selling them is a crime. It’s a crime even if the re-seller does not know the goods are counterfeit. There is a Latin maxim: Ignorantia juris non excusat. Ignorance of the law is not an excuse. If you sell counterfeit goods, you’re breaking the law. Period.

Trademark and patent infringement are strict liability crimes. Intent does not matter. The act is what matters. A business owner has a responsibility to maintain the integrity of his or her supply chain. The criminal penalties for selling counterfeit goods can range up to $2,000,000 and 15 years in jail. Therefore, it’s a good idea to make sure anyone with purchase authority within your company knows the consequences of buying counterfeit goods.

Lastly, business owners have to understand: Counterfeiting is not a victim-less crime. Behind counterfeit goods there is nothing but greed, human suffering and environmental destruction. Nothing good comes from counterfeiting. It’s a scourge on society and commerce.

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