The Legality of Buying Knockoffs

Susan Scafidi in The New York Times, October 28, 2010

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Robert Stolarik for The New York Times Goods on sale on a city street.

In a recent Bucks post, “How to Bargain at Markets,” I shared some of the tips my business school classmates and I learned while bargaining for knockoffs and counterfeit goods on a class trip to China.

But I left the legal question of whether buyers are breaking the law when they buy such goods for this follow-up post. To find out the legal issues involved, I turned to the lawyers who earlier helped me figured out the legality of copying favorite clothes and taking pictures of art work.

According to the lawyers I spoke with, it is important to distinguish between counterfeit and knockoff goods. Counterfeit goods, they said, actually have copies of a brand’s label or signature symbols or marks that so closely resemble the original they appear identical  (think a Lacoste-looking design with the signature alligator). Knockoffs, on the other hand, don’t have such words or symbols and merely resemble the original.

When it comes to buying knockoffs without the label, buyers pretty much have nothing to worry about.

As to counterfeits, if you buy them for personal use, “almost everywhere in the world, it’s illegal to sell them but legal to buy them,” said Susan Scafidi, a professor at the Fashion Law Institute at Fordham University and an academic director there.

“The law only apples to the supply side and not the demand side.” But, she said, there are two major places where buying counterfeit goods is illegal: France and Italy. In France, she said, you can face a steep fine and jail term for buying counterfeit goods, while in Italy, she said, you can be fined. In addition, she said, Customs in the United States will allow travelers to bring one counterfeit good per category. Bringing more than that could mean you plan to sell them, and officers may confiscate and charge fees for them.

So why is buying counterfeit goods generally considered O.K. by the law? First, Ms. Scafidi said, the notion of arresting or fining tourists for buying those goods (say on Canal Street) is not an attractive proposition for the tourism industry.

Second, it’s difficult to distinguish between consumers who know what they are doing when they are buying counterfeits and those who don’t and think they are buying the real thing. “It’s hard to prove people knew it was a counterfeit,” said Chris Sprigman, an intellectual property law professor at the University of Virginia School of Law who has written on copyright issues for the Freakonomics blog.