Counterfeit Luxury Goods and ACTA

I am so happy to share this post with all of you today. In what is probably one of the proudest moments of my life, an article I served as a research assistant on was just published by the Cardozo Law Review. William Mitchell College of Law’s IP Institute Director, Professor Kenneth L. Port, authored A Case Against the ACTA. (33 Cardozo L. Rev. 1131) I was lucky enough to be asked by Prof. Port to be his research assistant on the piece due to my background in luxury goods and fashion law. While I may thoroughly disagree with just about every single statement Prof. Port makes in the piece (see footnote 1a), doing the research for the article and working in an environment where spirited debate over the topic occurred on a daily basis was the highlight of my law school career. I owe Prof. Port my sincerest gratitude for bringing a fighter such as myself on board when he knew how opposed I was to his point of view and that I do not back down from any challenge. In other words, he knew what he was getting himself into and went ahead with it anyways. To his credit, Prof. Port does not like “yes men” when writing an article. He prefers working with at least one other person who vehemently disagrees with him on the topic because it makes the end product much stronger. That was certainly the case on this article!

the process

Like the saying goes, “The best offense is a good defense.” So our constant attempts to convince one another that they were wrong not only improved the paper but it also strengthened my own arguments and beliefs. It was as if I was preparing for battle everyday armed with research results, articles, books etc. all to prove my point as I went in to meet with him. Once the battle begins, the holes in your argument which you were unaware of / blind to, are quickly exposed. I would return home, research more to fix those holes and then tested how well my new theories worked in the next day’s battle. This process was rewarding on so many levels. Not only was I able to garner a better understanding of the issues at hand but also I achieved greater strength in my convictions and more self-confidence in my arguments. Too many people these days declare they are “right” on an issue and don’t listen or bother to research the other side’s point of view. I cannot stress enough how helpful and meaningful working for the other side is in legal related matters. That’s why so many prosecutors go on to make great criminal defense attorneys. To truly know and strengthen your own offense, you must first develop a nearly impenetrable defense. Work with the opposition whenever possible!

the paper

The Anti-Counterfeiting Trade Agreement (ACTA) is an initiative by the Obama Administration to get all countries unified and take a stronger police action in the fight against counterfeit goods. While the paper focuses on the luxury counterfeit goods market (such as fake Louis Vuitton bags or Air Jordan sneakers) it is important to note that ACTA also applies to things like counterfeit toilet paper (a real thing!), counterfeit perfumes and counterfeit prescription drugs. While counterfeit toilet paper is kind of funny, counterfeit perfumes and drugs are no laughing matter. Fake perfumes have been found to contain anti-freeze, urine and pesticides among many other things no person in their right mind would ever want to spray on their body. The real killer, literally, are the counterfeit prescriptions. There have been many cases where unsuspecting people take things like heart or blood pressure medication thinking it is the legitimate pill their doctor prescribed only to die because the version they were taking was counterfeit and did not contain the right (or in some cases, any) active ingredients necessary for their health condition. Lest you think this only happens when people buy drugs in Mexico or from online sources, think again. There was a recent case in Canada where at least 10 people died because their pharmacy had unknowingly received and dispensed a counterfeit cholesterol drug.

While ACTA is necessary to fight such counterfeit evils, many consider the fact that it also applies to counterfeit luxury accessories as “frivolous.” Some people don’t think private label luxury brands like Louis Vuitton need protecting from counterfeiters at the government’s expense. However, people fail to realize that counterfeit luxury accessories have far reaching human-interest issues at stake just as counterfeit pharmaceuticals. Children have been sold into slave labor to create these goods in Asian countries. The actual materials used to make the goods are found to contain elements like lead. The proceeds from the sales of counterfeit goods are used to fund underground organized crime and some allege that counterfeit profits have been used to support terrorist cells. This paper tries to dispel these facts and figures and through my research for the paper, I found some of the arguments floating around regarding counterfeit goods have never been definitively proven. (Such as the terrorist link.) That was eye opening to me, that maybe the problem is not as severe as some may lead us to believe…in some cases. In other cases, the effects of counterfeit goods are deadly and to save people’s lives, ACTA is necessary. But that is just my opinion. Read the paper and see if you agree with me or not. 

I am posting the abstract for everyone to read here on Neon Esquire. If you want to read the entire article, click here and you can download the paper in its entirety for free.

the abstract

33 Cardozo L. Rev. 1131

Cardozo Law Review

February, 2012



Kenneth L. Port a1
Copyright (c) 2012 Yeshiva University; Kenneth L. Port Abstract

The Anti-Counterfeiting Trade Agreement (ACTA) is being considered by the Obama Administration as an executive order. If signed, this order will greatly enhance controls placed at the borders of thirty-seven countries to attempt to stop the international flow of so-called counterfeit goods. To remove the social, political, and emotional stigma, I adopt the value-neutral term imitative commodity to describe what some call counterfeits, knockoffs, or pirated goods, among others. This Article uses just three manufacturers of luxury status goods to consider whether the ACTA will have optimal or negative consequences. It concludes that the data supporting the need for the ACTA is overstated and unverified; that the ACTA is actually not responsive to the precise problem that it purports to correct; that the ACTA merely acts as policy laundering, getting the Obama Administration something it fears it could not get through the public-law forum; and that the ACTA consists of vague and misdirected border measures and criminal provisions. The ACTA is raised in the context of international terrorism supporting or maintaining the imitative-commodity industry. However, just like the value of the imitative-commodity industry, the value of the actual support the imitative-commodity industry receives from terrorists and the benefit derived by terrorists is grossly overstated. In fact, there are many positive elements to imitative commodities. Some claim it is actually socially optimal to have some imitative commodities. Imitative commodities operate as free advertising for the legitimate good maker. Imitative commodities improve the goodwill of a legitimate good-maker. The sheer existence of imitative commodities allows legitimate high-end makers to sustain otherwise unsustainable prices for their luxury status goods. In the end, we have vilified imitative- commodities makers without giving thorough and analytical thought to the economic, *1132 social, or legal advantages made possible by some imitative commodities. This Article is about quantity, not quality. The ACTA operates as a sledge hammer to kill an ant. It works to make public the intellectual property rights of some manufacturers that used to be private. As such, the ACTA also operates as a corporate bailout. What is required instead is a nuanced solution to a nuanced problem. C