Counterfeiting and Piracy: The New York City Tourist Attraction

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While I have been to New York City many times on business, I have never really been for a fun visit, to take in the whole New York City/Manhattan experience.   I had such a wonderful time. I even got to meet Ivana Trump at the airport.

In January of this year I spent a few days in this wonderful city mostly touring the attraction sites.   Rather than taking taxi cabs everywhere I bought day passes on the tour buses and used that for my mode of transportation to get around the city.  

 I was completely fascinated (or should I say disturbed) that the bus tour guides, when talking about Canal Street, went out of their way to tell  everyone that Canal Street was a great place to buy counterfeit watches, purses and videos.   I couldn’t believe how out in the open the comment was, virtually every time I rode the bus.  In fact, all the tour guides made mention of a large basement-type warehouse that was the biggest on the street, filled with fake products.

My visit to Canal street was everything I expected it to be, but worse.   Tiny shops with backrooms full of fake Gucci, Coach and Fendi purses.  If you wanted a fake watch all you had to do was ask.   Either the watch vendor had them hidden or he could merely ask someone to bring them over in a canvas bag.   Everything fake was for the asking and buying.

While I can spot a fake Rolex and Gucci watch, the Breitling Bentley watches were good copies and were selling like hot cakes.   Women were lining up to get in the back rooms to look at purses, so clearly business was good for every vendor.

There had to be at least 100 people walking around with canvas bags selling watches, sun glasses and DVDs.  At the time I visited, the movie American Gangster was still in the theatres.  You could have bought an illegal copy of the DVD for $5.00 out of a canvas bag.

In only two other countries have I ever seen street vendor counterfeiting and piracy this bad; Japan and Thailand.  

When I got back to Toronto I was talking about the experience for weeks to people in my business.   It was like New York had given up and Canal Street Counterfeiting was the new tourist attraction.

I’ve worked for many manufactures and distributors (and their legal counsel) who have fallen victim to counterfeiting, piracy, and copyright violations.  Companies who have had to close factories and offices, and lay off staff.  Even legitimate retailers in the same industry are affected – unable to compete with these fakes.   While consumers look for fake bargains many legitimate companies suffer.

The money from this crime stays undergound, just like drug money.  It remains tax free to these vendors and will very often remain in the crime element.  Very often the products themselves are made in hidden sweat shops in Asia.

The PI industry has been fundamental in fighting counterfeiting and piracy and will continue to be.  Every company that has fallen victim has either directly or indirectly retained a PI firm to assist in the problem.    PIs usually act for the manufacture or their legal counsel.  They identify who the vendor is by working under the pretext of being a customer.  They buy products and then ultimately swear an affidavit to get the civil sheriff out to seize the goods. 

In the early to mid ’90s the streets of Toronto had the same problem.  Vendors were everywhere on the streets selling counterfeit products.    But back then it was very much a civil problem.  The police only got involved to keep the peace during the civil seizures of products.  They rarely laid criminal charges on the vendors.   

It was primarily up to the manufactures themselves to hire lawyers and private investigators to seek out the street vendors and  find the bulk of the counterfeit product.  Once the vendor had been identified  the necessary paperwork had to be filed so the civil court Sheriff could go out and do a seizure, and serve a law suit on the vendor.

Even more frustrating for the manufacturer was the fact that the Sheriff was only allowed to seize goods on behalf of the manufacturer named in the order.   This meant that if the Sheriff was acting for only one watch manufacturer (for example) he could only seize that one brand name.  All other fake brand names would remain unseized.  It was ridiculous.

Manufacturers had to team up with the same law firm so the civil Sheriff could raid the vendor and take just about everything in one raid.

While the manufacturers continue to try and sue these vendors, the civil judgments are worthless.  How do you  collect from a vendor working for cash?  There is simply no financial recovery.

The city of Toronto has pretty much cleaned up the problem from vendors selling counterfeit products in the open.  But many products can still be found in Toronto’s China Town. All you have to do is ask.  

It would seem that today, public law enforcement has become more involved in charging and prosecuting manufacturers and sellers of counterfeit products.   It is certainly not to the satisfaction of most victims and their associations who continue to fight the problem.

As long as there is no law in place that prevents the consumer from buying the fake products the problem will never be resolved.  

About a month after my trip I read that the New York Mayor’s office had raided dozens of storefronts on Canal Street.  They seized counterfeit goods with an estimated street value of more than $1 million.

Mayor Bloomberg and Police Commissioner Raymond W. Kelly, obtained a temporary restraining order to shut down the storefronts.  Forty-two undercover purchases were made in various storefronts. The investigation uncovered counterfeits of such brands as Coach, Gucci, Dolce & Gabbana, Dior, Prada, Rolex, Fendi, Burberry, Calvin Klein, Dora the Explorer and Oakley.   

While I applaud the raid, I wonder – how long will it be until they all come back?   Will there ever be a law that will stop people from buying the fake stuff in the first place?    Will we ever see a tourist held up at customs because he or she was found to possess a fake watch, purse, or a pair of sunglasses ? 

It’s doubtful !

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