Luxury brands are stepping up efforts to combat counterfeiters in court including Alibaba and other Western sellers, an article published on marketwatch.com said.
Several high-end names such as Gucci, Moncler and Alexander Wang are going after sellers of fake products both in China and the West as they have to contend with the growing number of counterfeit goods sold online, especially in e-commerce and social media platforms.
This month fashion brand Alexander Wang was awarded $90 million in a case filed last year in a New York district court against the owners of 459 websites who were suspected to be selling fake handbags, footwear and clothing. The websites of the counterfeiters were also frozen by the court, including their domain names which were transferred to the designer.
Alibaba and its sellers were also sued by Gucci and other luxury brands owned by Paris-based Kering SA for the alleged rampant selling of counterfeit goods in Alibaba's platforms.
But this month, a U.S. judge said that Gucci and the other plaintiffs had "failed to allege the existence of conspiracy" between Alibaba and its merchants, which led the court to dismiss part of the lawsuit. The decision, however, will not affect other parts of Kering's lawsuit, which claims that the Chinese e-commerce giant is encouraging the sale of fake goods on its sites.
Paolo Beconcino, a consultant for Beijing-based law firm Squire Patton Boggs, and represents about six Western brands in counterfeit lawsuits, observed that the lawsuits were a "strategic change" for those companies who have been silent about their efforts.
Although the raids and seizures have close down some manufacturers and sellers of fake goods, it was not proven if these methods have been effective in deterring the production of counterfeit goods.
In addition, since it is often difficult to know the seller of counterfeit goods and who to sue, companies have to take the services of lawyers and investigators.
According to U.S. authorities, almost two-thirds of counterfeits, worth about $1.2 billion, were seized from China in 2014, prompting the Chinese government to set up special courts in major cities to deal with the increasing numbers of cases involving intellectual property.
Martin Dimitrov, an associate professor at Tulane University in New Orleans, evaluating the Chinese government data said that the number of civil intellectual-property cases filed in Chinese courts between 2005 and 2014, has increased nine-fold to 133,000, while criminal cases rose 10-fold to 11,000.