NATIONALLY RECOGNIZED FEDERAL LAWYERS

27 Nov 23

Importing and Exporting Counterfeit Goods Across State Lines

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Last Updated on: 14th December 2023, 07:48 pm

 

Importing and Exporting Counterfeit Goods Across State Lines

Buying counterfeit goods online has become super common these days. I mean, who doesn’t love a good deal on a designer handbag or new pair of sneakers? But there’s a lot more to counterfeit goods than just scoring a bargain – there’s actually a whole bunch of legal issues that come with buying and selling knockoffs.

In this article, we’ll break down the laws around counterfeit goods and what happens when you try to ship them across state lines. Spoiler alert: it’s not as simple as clicking ‘Add to Cart’ and calling it a day! Let’s dive in…

What exactly are counterfeit goods?

Counterfeit goods are basicly unauthorized replicas of trademarked products – so things like fake Louis Vuitton purses or imitation Rolex watches. They infringe on trademarks and copyrights by using a brand’s intellectual property without permission.

The fakes might look pretty convincing on the outside, but they’re almost always lower quality than the real deal. Counterfeiters aim to cash in on the prestige of big brands by making knockoffs that seem legit at first glance. Sneaky!

Is it illegal to buy counterfeit products?

Yes, it’s 100% illegal to purchase counterfeit goods – even if you didn’t realize it was a fake at first. Ignorance is not a legal defense here. As the buyer, it’s your responsibility to make sure you’re not buying counterfeits.

Some key signs a product is counterfeit:

  • The price seems too good to be true
  • The quality feels lower than normal
  • Minor design details are off
  • The packaging looks a little sketchy

When in doubt, don’t buy it! Not worth the risk.

What are the penalties for buying knockoffs?

If you get caught purchasing counterfeit goods, you could face both civil and criminal penalties. Here’s what you might be looking at:

  • Fines up to $2,500 per counterfeit item
  • Jail time (for willful counterfeit purchases)
  • Getting sued by the brand owner for damages
  • Seizure of all counterfeit goods

Yikes! Those fines and lawsuits can add up fast if you’ve bought multiple counterfeit items. The risks definitely aren’t worth the temporary thrill of finding a ‘deal’.

What about selling knockoffs – is that illegal too?

Oh yeah, selling counterfeit goods comes with even steeper penalties. We’re talking fines up to $2 million and up to 10 years in prison. Not to mention getting sued by brands for lost profits.

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Some key activities that can get sellers in legal trouble:

  • Knowingly selling counterfeit products
  • Making and distributing counterfeit goods
  • Importing knockoffs from other countries

Moral of the story – don’t sell fakes! Brands take counterfeiting super seriously and will come after infringers.

Can you mail counterfeit goods across state lines?

Trying to ship counterfeit products between states is risky business. Technically, it’s allowed under federal law – but states have their own rules that make it illegal in many cases.

For example, California, New York, and Texas all have laws prohibiting the intentional transportation of counterfeit goods[1]. So shipping a fake designer handbag from LA to NYC could land you in legal trouble.

Things get even more complicated when you try to import knockoffs from overseas. U.S. Customs is on high alert for counterfeits coming through ports and airports[2]. If they catch your shipment, you could face:

  • Fines of up to $10,000 per item
  • Criminal charges
  • Permanent banning from entry into the U.S.

Yikes! Those penalties are next level. Mailing counterfeits internationally is playing with fire.

What about selling counterfeits online?

With the rise of ecommerce, a ton of counterfeit sales have moved online to sites like eBay, Amazon Marketplace, and Craigslist. And selling fakes through these platforms still counts as illegal!

The online marketplaces themselves are trying to crack down on counterfeit listings. For example, Amazon has a whole anti-counterfeiting policy that lets brands report infringing items[3].

But a lot of knockoffs still slip through the cracks. As a buyer, make sure to thoroughly vet sellers before purchasing hot ticket items online. Look for signs like no reviews, super cheap prices, stock photos, etc.

What defenses can you use if caught with counterfeits?

Let’s say you got busted crossing state lines or importing counterfeit goods – what can you argue in your defense? Here are some common counterfeiting defenses:

  • You didn’t know it was counterfeit. If you can prove you purchased the item in good faith, believing it was genuine, you may avoid liability. But ignorance isn’t always a foolproof defense.
  • Someone else put it in your luggage. If traveling, you could argue a counterfeit item was planted without your knowledge. But you’ll need evidence to back this up.
  • It’s for personal use only. Some states exempt personal use and possession of counterfeits. But others, like California, still consider it illegal.

The bottom line – claiming you didn’t know it was fake or that it’s ‘just for personal use’ won’t always get you off the hook. Avoid counterfeits altogether if you want to steer clear of legal issues.

How can officials identify counterfeit shipments?

Customs officers and local law enforcement use a few key techniques to spot counterfeit goods:

  • Visual inspections – Comparing logos, stitching, etc. to the real product
  • Scanning paperwork – Looking for irregular shipping docs and invoices
  • X-rays & drug dogs – Checking for hidden compartments of knockoffs
  • Test buys – Ordering goods online to inspect and confirm authenticity
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They also work closely with brands to stay on top of the latest counterfeiting tricks and loopholes. So smugglers have to get pretty creative with concealing shipments.

What’s the scale of counterfeit trafficking globally?

The global counterfeit industry is booming – it’s worth an estimated $500 billion per year and growing[4]. China produces the most by far, followed by countries like Singapore, Thailand, and Turkey.

Some staggering facts on counterfeit trafficking worldwide:

  • Up to 5% of all global trade is in counterfeit goods
  • Clothing and footwear account for the most counterfeit shipments
  • The U.S. is the #1 importer of counterfeit goods
  • Free trade zones like Dubai facilitate distribution of knockoffs

So counterfeiting definitely isn’t just a few rogue sellers – it’s a massive global enterprise. And buyers who ignore the law are keeping the whole thing going.

Why do people even buy knockoffs?

With all the legal risks, why do people keep purchasing counterfeits? Here are some of the main motivations:

  • They’re cheap – People want luxury brands but don’t want to pay full price
  • They’re easily accessible – Lots of fakes sold online and in foreign markets
  • People don’t think it’s a big deal – Don’t consider the impact on brands
  • Lack of social stigma – No longer shameful to buy ‘replica’ goods

For many shoppers, the lower costs and ease of buying counterfeits online outweighs the legal consequences. But make no mistake – counterfeiting takes a huge toll on brands and the economy.

How do knockoffs damage legitimate brands?

When you buy counterfeit goods, it might feel like a victimless crime. But legitimate brands suffer in many ways:

  • Lost sales and profits from counterfeits
  • Harm to brand reputation and image
  • Devaluation of intellectual property
  • Increased costs for anti-counterfeiting efforts
  • Potential risks to consumer safety

Counterfeits siphon billions from the U.S. economy each year by undercutting American businesses[5]. So don’t rationalize buying fakes as a harmless bargain – it fuels an illegal enterprise.

The bottom line on counterfeit commerce

There’s no way around it – trafficking in counterfeit goods is illegal, unethical, and dangerous for shoppers and brands alike. The risks of fines, prison time, and lawsuits simply aren’t worth scoring knockoff products.

Instead of wasting energy hunting for fakes, put that effort into finding authentic items you love within your budget. Or save up for the real investment pieces that are worth splurging on. Your wallet and conscience will thank you!

 

[1] California Penal Code § 350, New York Penal Law § 165.74, Texas Business and Commerce Code § 2.012

[2] https://www.cbp.gov/trade/fakegoodsrealdangers

[3] https://www.amazon.com/gp/help/customer/display.html?nodeId=200277250

[4] https://www.oecd.org/sti/ind/2090589.pdf

[5] https://www.cbp.gov/trade/fakegoodsrealdangers