The Counterfeit Sham

Abstract

There’s a new front in the IP rhetoric wars. Plaintiffs in “Schedule A” cases tell judges that they need to secretly seize the assets of hundreds of defendants all at once in order to defeat the machinations of nefarious foreign “counterfeiters” — even in cases where no counterfeiting (or even plain trademark infringement) is alleged. Proponents of bills that would allow Customs and Border Protection to seize products that might infringe design patents try to equate those products with “counterfeits,” invoking the specter of counterfeit drugs to suggest that design patent infringement threatens the health and safety of U.S. citizens. Although design patent infringers may sometimes also be counterfeiters, these two legal offenses are actually and meaningfully different. Unlike counterfeiting, design patent infringement does not require the use of any trademarks or any likely consumer confusion. Even if we’re discussing “counterfeiting” in the more colloquial sense, a competitor need not identically copy a product — or do anything deceptive at all — in order to infringe a design patent. A product that infringes a design patent is not
necessarily more dangerous or harmful than any other product. For these reasons and others, the direct equation of design patent infringement to counterfeiting is false and the appeal to fear is fallacious. This Article argues that policymakers, judges, and other decisionmakers should not fall for this sham.

Keywords: intellectual property, patents, design patents, trademarks, counterfeiting, rhetoric