11 grudnia, 2012

Counterfeiting? No, Thanks

Trademarks are the most valuable commodities in the fashion industry. Fashion companies rely on their trademarks so consumers can identify a particular brand's products easily, which in turn has a bearing upon whether the consumer elects to purchase the product. Since copyright protection for fashion designs is limited, fashion companies must rely on their trademarks in order to help distinguish their products from those of their imitators.

Trademarks have the ability to stimulate consumer demand for products globally. This is particularly true given the advent of the Internet. Marks indicate that a particular product is associated with a certain reputation, and that, by buying another product with the same mark, consumers are purchasing item of the trademark owner's standard of quality. With the increased demand for certain trademarks, counterfeiters have realized the benefit of copying such IP. Counterfeit products can be created at a relatively low price and can be sold for great profits. 

What is trademark counterfeiting?

Trademark counterfeiting is the act of manufacturing or distributing a product or service bearing a mark that is identical to or substantially indistinguishable from a registered trademark. Simply put, trademark counterfeiting is theft of someone's IP. People who copy legitimate products not only reproduce the trademark owner's original patterns and designs, but they also decrease the value of the original products in the marketplace by making exclusive products seem as though they are available at mass-market prices. This practice harms the trademark owner, who seeks to maintain the exclusivity of the brand in the marketplace, while at the same time it allows counterfeiters to capitalize off the established goodwill and reputation of the trademark owner.

The Elements of Fashion Law

In practice, fashion law involves the application of principles from a number of legal disciplines - in particular, protection of IP, including anti counterfeiting and licensing; commercial operations, including the legal structure of a fashion business, commercial agreements, relevant employment law, marketing and advertising, and retail leasing; and international issues.

At the heart of both fashion law and entertainment law is IP law. However, fashion-related IP calls into play a number of specific principles not encountered in the entertainment context. While copyright issues are prevalent in the entertainment context, trademark issues are characteristics of the fashion industry.

IP is fundamental to the strategies of most large fashion companies. Fashion companies are able to charge a premium for their products to the extent that they have created brand value. Thus, an ordinary T-shirt sold as  a commodity (i.e., unbranded) would not fetch more than 10$ in today's marketplace, regardless of its quality. However, a T-shirt by Valentino may sell for $750. Brand value - another way of saying IP - is extremely expensive and difficult to acquire. Once fashion companies have brand value, they wish to keep and control it, and that is the job of their legal counsel. Most general counsels at major fashion companies began their legal careers as IP specialists.

09 grudnia, 2012

Order in the Court!

In the last year major fashion houses have gone to court over copyright infringement, unethical work environments, and piracy issues.  Check out our gallery featuring 15 of fashion's biggest lawsuits — we promise you you'll never consider buying a fake Fendi ever again!