Luxury Brand Makes Inroads in Combating Digital Counterfeiting

By Maria A. Savio

While makers of drugs and electronics are routinely assisted in their efforts to combat counterfeits by Customs and law enforcement because the health and safety of consumers are at risk, luxury goods manufactures usually pursue claims in civil courts. Armed with information resulting from smart investigative work, Belstaff, a premier British apparel and accessories brand, recently prevailed in a lawsuit brought in a New York federal court. The suit resulted not only in an award of over $42 million dollars in damages to Belstaff, but also the closure of 650 websites selling counterfeit BELSTAFF goods. The closure of the offending websites is not only a huge victory for Belstaff and its unsuspecting consumers, but a huge victory for all luxury goods manufacturers, especially for those companies whose goods were also sold on the offending websites.

The expansion of the Internet has forced even luxury goods makers to grapple with the problem of online counterfeiting because consumers assume that luxury goods makers are finally selling their goods online, like other retailers. Counterfeiters today are no longer just selling obvious knockoffs–a $25 obviously fake “Cartier” watch for instance–they are selling what to many will appear to be “genuine” goods. Consumer belief that the goods are “genuine” comes from the fact that the price of the counterfeit item is substantial: a discount of the original rather than a price so low that a counterfeit would be indicted.

Emboldened by the low likelihood of being caught because of their digital fronts, online counterfeiting has been a very real problem for all brands. Pictures rarely show differences between a genuine versus a fake product, and often genuine goods are shown and counterfeit goods are delivered. This presents a dilemma for brands whose image is tarnished by any tolerance for a marketplace filled with counterfeit goods. The take away is that good online investigative work–where purchases are not cash and money can be traced–will flush out the counterfeiters and make actions to enjoin their activities more streamlined, cost effective and successful.

Originally posted on “The Connector.”