Retailers: fighting back against the online counterfeiters

In a recent case of great importance to retailers, it was recognised that: “the internet has become an increasingly important channel of trade in counterfeit goods”.

Whilst trading standards would usually pay a visit to those identified as selling counterfeit goods in their stores, the position quickly becomes complicated when retailers attempt to prevent counterfeit sellers (potentially operating in a number of different countries) offering goods for sale over the internet rather than in-store.

How can retailers fight back against online counterfeit sales?

Almost everyone will have heard about the blocking of illegal file sharing sites such as The Pirate Bay and Newzbin, which were blocked in order to protect the copyright of those producing digital content. The trade mark on the other hand, protects names and logos, a key part of any business’ brand.

In the first case of its kind, the courts recently ordered the blocking of a website in order to protect a trade mark, preventing access to a number of websites selling counterfeit Cartier jewellery and Mont Blanc pens. During the case, the court recognised the importance of trade marks and that their infringement through the sale of counterfeit goods had the potential to damage brands in four ways:

1. lost sales;
2. loss of reputation, particularly in the eyes of those who receive the counterfeits as a gift, believing them to be the real thing;
3. eroding the sense of ‘exclusivity’ associated with the brand; and
4. damaging the confidence of consumers across the wider market.

Whilst the retailer applying for the blocking order will have to bear the costs of the application, it will be the Internet Service Providers (the likes of Sky, BT, Virgin and TalkTalk) who will be responsible for the costs of implementing the technical measures necessary to actually prevent their subscribers from accessing the counterfeit websites. This marks a significant step towards helping retailers protect their brand and products, and we are likely to see similar applications from others looking to protect their Intellectual Property in the future.

Will the blocking make a difference?

Blocking file sharing websites for the purposes of copyright protection hasn’t proved as successful as some might have hoped. This is principally because those with the technical ability to use the file sharing sites in the first place are likely to also have the ability to circumvent the blocking measures.

Blocking sites in order to protect trade marks, however, is likely to prove more successful. These measures affect a much wider demographic of people, many of whom are unlikely to be able to circumvent the blocking measures.