Counterfeit Goods Impacting on New Zealand Clothing Industry

Just think of Nike, Adidas, and Calvin Klein, all have spent tens of millions of dollars researching, developing and advertising their designs.

So it is no wonder there is money to be made in the business of cheap knockoffs – or copies

Internationally this costs companies up to $600 billion a year, and it happens here.

Customs and police can only do so much; ultimately the local distributors often end up chasing the counterfeiters.

LRG is a pretty big name in the U.S

Founded in 1999 it specialises in street wear clothing, dabbles in music and sponsors a skateboarding team. And it turns over a healthy profit.

In New Zealand it’s got a solid reputation too. But it’s pricey.

Those high prices mean a market has developed for cheap knock offs, which are turning people off the real thing.

LRG’s New Zealand distributor is fed up, so invited Campbell Live along on a sting.

Mike’s job is to spot a fake, pay for it, take a photo on his phone, then lay down the law.

Mike issues infringement notices, threatening court action, and ordering the shop to immediately stop importing, buying or selling LRG counterfeit goods.

In one shop Mike finds a fake L-R-G hoody, for $15.

In a moment we confront the owners and ask them why they are selling counterfeit goods.

But first, we took the fake stuff to Peter Till, the man who imports the genuine product.

He had seen the two hoodies before, but the t-shirt is new to him, and a very good copy.

He said “it is pretty close I mean it is amazing they can do that for that cost, I don’t know how but it is very close there’s only a few minor details that I’d be able to pick up that it’s not genuine product.”

The hefty price difference between the counterfeit and the real is an obvious problem.

LRG’s target market is teenage boys, who don’t have a lot of money. So why not buy the counterfeit version for a 10th of the price, if it looks kind of the same? Because Peter Till says you are buying the brand.”Nike for example, Tiger Woods and things want to be seen like him, and partly you are paying for that.”

And it’s not just LRG that is getting ripped off.

In 2007 customs seized 49-thousand items of counterfeit clothing, but if these items do slip past our borders its left to the big labels themselves to do the policing – the likes of Walt Disney, Calvin Klein, Adidas, Billabong, Quicksilver, Ralph Lauren, Versace and NBA.

And a lot of it ends up on the street at markets, or in discount shops.

All the stores we visited pleaded ignorance when we approached them for comment.

Claire Tompkins is an intellectual property lawyer, and says it is inconceivable these shops are innocently buying what they think is a genuine article.

“You would have to be very naive to have purchased these products at the cost that they’re buying them, these people would be paying less than one dollar per item.”

In the last three weeks, Claire has successfully sued four importers or retailers of counterfeit goods for a total of $15,000.

She’s about to settle another case worth $40,000. “Every time you purchase a counterfeit product you’re contributing and perpetuating the demand for counterfeit goods, which won’t exist or would be reduced if every time you do that, you put it back on the shelf.”

As for Peter Till, he says for each fake garment that is sold it’s hurting more than his business. Sponsored events like surfing and skateboarding are at risk.

But he is determined to win the fight against the counterfeiters.

“But if people are going to offend then we are going to be firm with them and we will prosecute them.”

Source – 3 news, October 2008

*Please note that Addmaster was acquired by the Polygiene Group AB in January 2021, so all news articles prior to that date will still be branded as Addmaster.