A number of our clients manufacture products that sell for relatively high prices due in large part to distinguishing characteristics of our client’s company or product.  In other words, the exact kind of product counterfeiters love to copy.

Not sure why, but we have been spending more time lately in helping our clients prevent counterfeiting and in deal with it once it has been discovered.  Hence, this post on how to stop China counterfeiting, or at least reduce it.

Here are the four keys to stopping China counterfeiting:

1.  Much counterfeiting comes from people and entities that know your product well. This could be your manufacturers, your distributers, or your retailers, or your own employee or an employee of a company with whom you are doing business.  It therefore behooves you to do your utmost to conduct business with well-run and reputable companies and to keep your eye on them nonetheless.  If possible, it also behooves you to do your best to prevent these companies from having full and unfettered access to what they need to copy your products.

2. Register your trademarks in China and in your home country, and wherever else you sell or plan to sell your product.  I know regular readers must be getting tired of us always saying this, but hey, it’s the truth. Why is registering trademarks so critical to protecting trademark rights in China?  Because without registering them, you pretty much do not have any such rights. Also, if you register your trademarks in China, you can then also register them with China Customs, which greatly increases the likelihood of China Customs stopping counterfeits of your products from leaving China.  For more on this, check out Register Your China Trademark Now. Then Register It Again With Customs.

If you register your trademarks in the United States and then complete an Intellectual Property Rights e-Recordation (IPRR) application online, US customs will then be on guard for counterfeits of your products coming into the US.

It also helps to go visit with China Customs and with US Customs (particularly at the ports where your products are most likely to transit) to show them examples of your legitimate products and to do what you can to train them to spot counterfeits of your products.

3.  Monitor, monitor, and monitor some more.  Check the internet constantly to see if anyone is selling counterfeit versions of your product.  At minimum, check both the Chinese language and the English language internet.  When we do this sort of monitoring for our clients, we invariably find the really big volume sellers on the Chinese internet.  Search the internet for counterfeits of your product both by name and by image.

4.  Do something to stop counterfeiters once found.  When we find someone on the internet selling counterfeit versions of our clients’ products, we typically send the seller a cease and desist letter.  If, as is usually the case, the seller is based in China, we send that letter in both Chinese and in English. We make clear that if the seller of the counterfeit goods does not immediately cease, we will retain a local Chinese law firm (which we usually name in the letter) to pursue litigation.  These letters usually work. In fact, many times, the seller will profess not to have known that they were selling counterfeit goods (and in some cases I have believed them) and they will often ask whether they can buy the real thing at wholesale for retail resale.

In most instances, the counterfeit goods are being sold on some sort of marketplace site such as eBay or Amazon or Alibaba or Taobao, or — in many cases — some lesser known Chinese online marketplace. The bigger name marketplaces (American and Chinese) have procedures for securing the removal of counterfeit goods from their sites.  The Chinese sites remove the counterfeits only if you can prove you have a Chinese trademark and the American sites generally require proof of an American trademark.

If the above actions do not achieve your desired results, you need to consider suing somebody somewhere to stop the counterfeiting.

What do you think?

In both the United States and in China, one need not actually register one’s copyright to have one. This oftentimes leads companies not to bother registering their copyrights.

The problem with not registering your copyright in China is that it is nearly impossible to prevail in a copyright lawsuit unless and until your copyright has been registered. American companies too often think this is no big deal, figuring that if anyone infringes on their copyright, they will simply register it and then sue. However, the problem with this thinking is that securing the actual copyright registration in China typically takes from 12-18 months.

If a Chinese company is violating your copyright and you cannot sue for another year, it becomes very difficult to stop the Chinese company from infringing. You can write a cease and desist letter, of course, but it will not be all that powerful because you will not be able to cite to any registered copyright and the infringing company will figure it has at least another year or so before it really need worry much. This delay is particularly problematic for gaming companies because by the time they can sue for a copyright violation of their game, that game may no longer even exist in its previous incarnation.

Registering copyrights for video games in China is very much like doing so in the United States. Because of this, when we do such registrations, we usually just track what has already been done in the U.S. Registering video games in China consists of the following:

  • Registering the source code using China’s special software registration rules.
  • Registering the artwork as a work of art. The normal strategy for video games is to treat each character as a work of art. If there are special locations, these are also treated as a work of art. All the artwork is then collected into a bundle and is registered in one filing. The exact physical item that is sent to the registration authority depends on the nature of the work. Registration is not expensive and it is better to register too much rather than too little.