• by Christine Bittar , February 6, 2007

Hearst's Harper's Bazaar magazine convened a conference in New York City last week focused on counterfeiting and piracy, which is estimated to be a $600 billion-a-year global issue. It was part of a kickoff of the Harper's Bazaar Anticounterfeiting Alliance.

Products most commonly counterfeited, experts said, include cigarettes, prescription drugs, videos, CDs, handbags and apparel. It's also a crime that is increasingly being tied to child labor, drug trafficking and even terrorism.

With increased attention on counterfeits and product knockoffs, law enforcement, intellectual property lawyers and other advocates against fakes are calling for increased copyright protection as one deterrent against pirated merchandise. The proposed copyrights wouldn't be just for outright fakes, but also for styles and designs of merchandise from handbags to clothing.

Part of Harper's Bazaar's efforts include a Web site, Fakesareneverinfashion.com, in addition to a new monthly feature in the magazine challenging readers and fashion students to design "Fakes are Never in Fashion" ads, with a winning submission featured each month. Harper's Bazaar Senior Vice President and Publisher Valerie Salembier is hoping the efforts to elicit consumers to spotlight and identify knockoffs will help stop the sale of fakes.

Still, there are consumers who actually prefer a look-alike--even those who also buy luxury items and designer wares at full price.

"Private labels, once thought of as no-frills offerings, have been getting a makeover," noted the Yankelovich Monitor Minute. "With Target leading the way, a number of national discount retailers have upgraded their in-house offerings. Studies now show that more than 8 in 10 consumers believe that their quality is just as good as national brands."

In October, Coach Inc. accused Target Corp. of selling a fake Coach handbag. A similar accusation was made by Fendi S.R.L. against Wal-Mart Stores in June.

The Council of Fashion Designers of America will urge Congress to pass the Design Piracy Prohibition Act, which if passed will mean copyrights for designs or shapes.

Existing U.S. laws only protect against counterfeits, which largely means using the label or design insignia--but not design piracy, which is essentially counterfeiting without the label, said attorney Alain Coblence of Coblence & Associates.

The Design Piracy Prohibition Act was presented before Congress in March. Although the Act needs to be presented to the new House and Senate in Washington, D.C., Coblence says politicians last year seemed to be in support of the Act.

The Act would not affect designs or styles already in the public domain, but new and original designs of apparel and accessories. The CFDA is suggesting three years of protection from knockoffs if the designer files for copyright protection--which means that retailers would not be able to sell their own versions of new designs before the three-year period ends.

While there have long been fakes and counterfeit merchandise on the market, much of those goods were previously sold on the street and in flea markets where consumers were more likely to realize they weren't buying the real thing. Now, some of this merchandise is available in discount department stores.

While this may not stop "crooks and gangs" and others that law enforcement is targeting, if the Act comes to pass it will have an impact on retail chains--discount and others--as well as legitimate mainstream manufacturers, who typically sell their own versions of new runway designs. For instance, while higher-end department stores sell designer clothes, some may also have their own very similar looking private label versions on different floors.

Ultimately, Coblence predicts that design protection will lead to more department stores striking deals with designers for chain exclusives. That's something that has already started, with the most recent example being J.C. Penney's new partnership with Polo Ralph Lauren.

"American fashions cannot survive if they are being copied in China," Coblence said. "It's life and death for the U.S. fashion industry."

Technology and the speed of the Internet are making designer fakes more of a problem. Sometimes knockoffs are available before the designer versions make it into stores, said Coblence. Part of that is due to 360-degree pictures that are downloaded and then copied by robots overseas, he says. "It used to take six weeks to copy a design, now it takes three hours."