Counterfeits in different industries I

 

 

Give me a product, any product, and I’ll show you at least one counterfeit version of it.

 

The above line may be an exaggeration, but we’re not far from the truth. Counterfeits, lookalikes and other types of IP-infringing products are widely available to customers anywhere in the world on marketplaces on- and offline.

 

Counterfeiting is not an industry-specific problem. It affects brands across all industries from basic food products to luxury watches, and every IP right holder has to take proactive action to protect their intellectual property.

 

However, the way fake products materialize on the market, their nature and the best remedies against them vary significantly from industry to industry. It’s easy to see why a fake software can’t be dealt with the same way as a fake perfume.

 

These sometimes obvious, sometimes much more subtle differences are very important - and often quite fascinating. Brands and online brand protection experts always have to take them into consideration when investigating a counterfeit problem. But we often find that there’s a general lack of awareness about the way fake products can appear and about their differing nature.

 

So, here’s a peek into the world of counterfeits. In this article and the ones that follow, we want to introduce you to various types of counterfeits that materialize in different industries, where to find them, and what steps we take to protect your brand’s IP rights from them.

 

Let’s get started!

 

Since there are no physical products to manufacture and distribute, fraudsters active in the software industry usually focus on stealing access codes to software, or creating fake profiles with pre-existing access and selling them online.

 

Various websites in both the light and darknet offer dubious access to well-known software products. For example, we found suspiciously cheap lifetime access to Microsoft software on ovokeys.com, and similarly priced Apple Mac OS software products on cheapsoftwareshop.com.

 

Screenshot of ovokeys.com/product/microsoft-software-collection

 

 

Screenshot of cheapsoftwareshop.com’s display of Apple software products

 

 

Since no physical products have to be sent to the customer, the exchange of goods usually takes place online, right after the sale. Customers can download the purchased products from the site, or in some cases, they have to contact the seller to receive access to the software.

 

Some of these sites endanger a lot more than software brands’ IP rights. In several cases, especially on the darknet, malevolent programs like viruses or Trojans attach themselves to the purchased software and infect the buyer’s computer instantly.

We use a combination of automatic and manual monitoring on both the light and the darknet, including closed forums to ensure that we find IP infringing versions of our clients’ software products. Once we find those, we can do a test purchase to determine the origin of the product and learn as much about the seller as possible.

 

Due to the nature of the goods, we’ll receive it very fast, sometimes even instantly. In addition, we can do some forensic research on the file to determine when it was created, who is the owner, has it been shared via GDrive, how many users have access, etc.

 

When a product is proven to be infringing, we enforce our clients’ rights and demand the listing is taken down immediately.

 

 

 

Merchandise from sports clubs is tremendously popular among fans. However, some of them may seem a bit pricey and probably not as easily accessible for sports fans who live farther from their club. In addition, many of these items are seasonal, which means they’re only available for a short time and in limited quantities. Fans who don’t want to be left out would go out of their way to secure the last of a special edition jersey or hat.

 

Unfortunately, fraudsters have discovered this market niche for themselves.

 

In our experience, the most counterfeited items in this category are sports club jerseys. Fraudsters either create direct copies of original jerseys, or design similar items that try to resemble the originals.

 

On the other hand, various other types of merchandise are also popular targets for counterfeiting. The strategy here is two-fold: fraudsters either produce an object that tries to look like the original, or create products that don’t even feature in the original line of the sports club.

 

For example, we found replicas of World Cup trophies in circulation, and many other unauthorized products that bear a sports club’s logo, motto, or colours. Needless to say, these products are much cheaper than original sports club merchandise and are highly damaging to a club’s IP rights.

 

Take a look at the following screenshots. On the left hand side is a listing from the Brazilian Mercado Libre, offering a jersey with a Bayern München logo for 199.90 Brazilian Real (approx. 38 euros). On the right hand side is an original Bayern München jersey for 99 euros. The difference in price, as you can see, is quite significant.

 

 

Screenshot of a listing from mercadolivre.com.br	Screenshot of a listing from fcbayern.com

 

Since we’re talking about very popular, globally known products, a wide array of monitoring services are required to detect IP infringing listings. The first line of defence is our marketplace monitoring service that discovers potentially fraudulent product listings on over 150 marketplaces worldwide.

 

Fraudsters need to advertise their listings, which is why we recommend several complementary services to find other kinds of IP infringing content. For example, if fraudsters operate their own shop with a version of the club name in their domain, our domain monitoring service will find it, even in the case of multishops selling items from different sports clubs.

 

Similarly, potentially infringing images and ads may show up on social media and elsewhere on the internet, which makes our social media and image monitoring services indispensable.

 

Just like in the case of software products, a test purchase will help gather as much information about the origins of the product and the seller as possible. However, since we’re talking about physical products here, we have to calculate with a bit of waiting time to allow the seller to process the transaction and ship the products.

 

Finally, when a listing proves to be infringing on your IP rights, our enforcement service ensures its swift removal from the marketplace. This goes for infringing images, domains and social media content as well.

 

 

As our article about counterfeiting in the food industry pointed out, fake food is a serious problem for brands and consumers alike. While brands suffer from stolen revenue and damaged reputation, low quality ingredients and uncontrolled production methods may cause significant health hazards for consumers.

 

Find out all about the issues with fake food here

 

Low quality food masking itself as high quality, and one type of food being labeled as something else are two of the biggest trends in food fraud. Olive oil, coffee and tea can all fall victim to this.

 

For example, lower quality olive oil may be sold as extra virgin, and subpar coffee beans (or even completely different items like roasted corn or twigs) may be ground together with high quality beans to increase volume and lower costs. Also, chemically modified sugar syrup may be sold as honey, or horse meat can get labeled as beef.

 

The same can happen to milk products. The consequences are particularly devastating when the milk basis of baby formula is counterfeited; in one instance, six babies have died and 300,000 got sick due to fake baby formula contaminated with melamine.

 

We could go on but you get the point. No food is safe from counterfeiting, and no brand can evade the threat to their IP rights without a comprehensive brand protection programme.

 

As for distribution points, well, unfortunately, fake food is everywhere. Commonly known supermarkets, online marketplaces and even restaurants are not immune to the emergence of fake food products. In this regard, we may all be in danger of accidentally purchasing contaminated fake food.

 

 

Since organised crime is often the driving force behind the production and distribution of counterfeit food, we have to look at wholesalers and distributors besides B2C marketplaces. We use both on- and offline monitoring, as well as automated and manual searches to detect fake food for sale that infringes on our clients’ IP rights.

 

Marketplace monitoring is indispensable here, as are test purchases to determine the origin of the product and learn all there is to know about the seller. In case of fake food, we’d also recommend our partner compliance service to see whether your suppliers act according to your requirements and if they use the right ingredients and recipe, etc.

 

To complete the round, our enforcement service ensures the swift removal of the infringing listing to prevent it from doing any further harm to your brand and customers.

 

 

Fake food brings us to the end of the first instalment of our series about counterfeits in different industries. Stay tuned for Part II!

 

If you have any concerns about counterfeiting, grey markets, or any other IP infringement issues, contact us at globaleyez and let us know how we can help you.