Why is it so difficult to the make the case against counterfeiting (or does it just seem so)?

With the recent Black Friday sales seemingly have become an international marketing device to jump-start the holiday shopping season, this Kat, perhaps feeling a bit perverse (he hates shopping!) asked himself: Why do there seem to be so many willing purchasers of counterfeit goods? After all, counterfeiting is a business and it works only if there are willing purchasers. Unless one is prepared to believe that all purchasers of counterfeit products do so on an innocent basis, then the reasonable conclusion is that at least some of them are complicit. Why is it so difficult to make the case against counterfeiting to those central to enabling its illicit activities to be carried out?

Moral arguments, equating counterfeiting with stealing, do not seem to go very far with swathes of certain populations (have you had a talk about counterfeiting with a millennial lately?). Criminalizing counterfeiting, and the penal sanctions that go with it, may carry some weight, especially against the middlemen who import and then distribute the counterfeit goods. But the criminal sanction reaches only a small number of offenders. So what strategic measures are left? The United States Chamber of Commerce has chosen to appeal to consumer self-interest, as witnessed in a recent piece written by Kasie Brill, executive director of the Global Brand Council for the U.S. Chamber's Global Innovation Property Center (GIPC) (“Count Out Counterfeits this Holiday Season: Top Ten Tips to #ShopSafe “).

Ball’s primary argument focuses on the claim that counterfeit goods are "dangerous" and “pose a serious threat to consumers and businesses alike”, with special emphasis on product safety. The second line of attack is that counterfeiting contributes to economic hardship at the aggregate level, affecting innovation, stealing from legitimate companies, evading the payment of taxes, assisting illicit trade and even terrorism. These are weighty accusations. So what is the consumer to do? Brill has offered ten suggestions for better consumer conduct (all taken verbatim from her article):

1. Trust your instincts. If it’s too good to be true, it probably is.

2. Insist on secure transactions.

3. Watch for missing sales tax charges.

4. Seek quality assurance in the secondary market.

5. Buy medicines only from licensed pharmacy website.

6. Be vigilant when buying abroad. [Merpel says: she lives “abroad” and does not see the need to be more vigilant than a US consumer buying on his or her home turf.]

7. Guard your personal information. Don’t install add-ons or apps if you don’t know their purpose and don’t click on suspicious pop-up ads.

8. Scrutinize labels, packaging, and contents. Look for missing or expired “use by” dates, broken or missing safety seals, missing warranty information, or otherwise unusual packaging.

9. Report fake products. Report unsafe products to the Consumer Product Safety Commission. Spread the word. Share these tips! Teach your family, friends, and coworkers about counterfeits.

10. Spread the word. Share these tips.

These seem like sensible suggestions, even if they describe prudent consumer behavior more generally rather than being specific to counterfeit products. Which brings us back to the original question: if they are so obviously prudent, why do they need mentioning? Stated otherwise, why do consumers act in a manner contrary to the behavior outlined in these suggestions? Positioning counterfeiting within the domain of health and safely is rhetorically easy, as is suggesting steps that make it less likely that a purchaser will be harmed by a faulty counterfeit product. Most people can be relied on to do things that will not likely cause them injury.

But this approach avoids the really difficult rhetorical question: What about the large number of product categories for which there is no health and safety risk, and the attraction of a reduced price is presumably worth the risk that the purchased product will be less durable? We are told: “Trust your instincts. If it’s too good to be true, it probably is.” That may be the case, but this exhortation can only go so far—a seductive bargain is a seductive bargain.

An Italian colleague described for this Kat an Italian case wherein, as this Kat understood the result, no liability for the product was found because the price differential was so great that no one would deem it to be a counterfeit. A fake luxury watch, whose price is a tenth (or a hundredth) of the original product, fools no one and gives the purchaser short-term pleasure as a badge of prestige, no matter how faux it is. After all, if a purchaser is aware of the risks, buying a problematic product may cause her little or no harm and even provide her with some psychic benefits in owning a not-genuine positional good. Rhetorically countering this state of affairs has proved to be a daunting, indeed almost intractable, challenge. Or does it just seem so?

Photo on upper right by JoelnQueens is licensed under the Creative Commons Attribution 2.0 Generic license.

Photo on lower left by stallio is licensed under the Creative Commons Attribution-Share Alike 2.0 Generic license.

By Neil Wilkof