Legal fake

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Legal Fake is a recent[when?] phenomenon in the fashion industry, whereby a third company precedes the original brand company in the registration of the trademark, running its own business, from production to sales, in another country. By exploiting the products, creativity, marketing and advertising strategies of the original brand, the company misleads consumers, who are not aware of the fake goods. Thus, its typical traits lay upon the question of intellectual property, trademark registration laws among different countries, advertising strategies and consumer behaviour.

Legal fake is not to be confused with counterfeit. Its aim is not to replicate the original products, but to create a new business parallel to that of the original brand, proposing itself as an authentic brand. Compared to counterfeit products, legal fakes exploit brands that are well-known only to specific groups of people.

The Supreme case[edit]

The term legal fake was first mentioned after the important case between the famous streetwear apparel American company CHAPTER 4 D.B.A. Supreme in New York and the Italian company TRADE DIRECT Srl in Barletta, of which both Italian online magazines such as Nss Magazine.[1] and Outpump[2] and the American Highsnobiety[3] and Hypebeast[4] have discussed about. But most important, it is the recent judgments of the Tribunale di Milano that have further clarified and defined what legal fake is.[5] Supreme Italia was brought to court in 2016 by Supreme New York after it realised that they had been robbed of their trademark and that their brand image had been damaged. In fact, the notoriety reached by the Italian brand, which disguised as the original one, came to the point that it managed to enter the 89th edition of the most important International event for menswear Pitti Uomo in 2016 becoming popular among a wider range of consumers to which it wanted to reach compared to the original one.[6][7]

A Supreme "Box Logo" t-shirt

Judgments and laws[edit]

The existence of a ‘parallel’ Supreme brand was possible due to an ambiguity in the trademark registration process in Italy. In fact, Trade Direct Srl filed its application at the UIBM (Italian Patent and Trademark Office) on 18 November 2015 and started producing and selling its products changing little of the original box logo, which was simply made bigger. What emerged from the legal case would be then stated in the final judgment, and thus, that Supreme NY had already registered its trademark on 9 October 2015 before Supreme Italia. No new creative elements were added to the legal fake version, as stated by the first judgment from the Tribunale di Milano of 26 January 2017, according to which the Italian company repeatedly used the same brand, advertising images and graphics of CHAPTER 4. Though, unlike Supreme NY, Supreme Italia aimed at targeting a wider range of consumers by looking for more shops and retailers throughout Italy for the products distribution. This process brought Supreme Italia into the spotlight, reaching Supreme NY’s attention and leading to the legal case. After the second judgment of 20 April 2017,[8] the final judgment of 26 January 2018 stated the ‘parasitic’ unfair competition[9] behavior of Trade Direct Srl and its consequences: 120,000 Supreme Italia items have to be withdrawn from the market and the company is to pay € 5,500.00 to Supreme NY for fees and legal expenses.[10][11] Furthermore, the legal fake website www.supremeitalia.com can no longer be found. A particular mention is A.GI.EMME Srl as one of the main Supreme Italia resellers, which was also brought to court and cited in the final judgment. Indeed, it no longer sells the products nor offers them on its website.

Trade Direct Srl lawsuit falls within the field of unfair competition for the reasons listed in art. no. 2598 of the Italian Civil Code. This one concerns the protection of distinctive signs and patent rights and provides that is subject to the provision “anyone who engages in acts of unfair competition:

  • Uses names or distinctive signs capable of producing confusion with names or distinctive signs legitimately used by others, or slavishly imitates a competitor’s product, or fulfills by any other means acts likely to cause confusion with the products and the activities of a competitor;
  • Broadcasts information and evaluation about the products and the activities of a competitor, which may determine its disrepute, or steals the merits of the products or the company of a competitor;
  • Directly or indirectly uses any other mean not comply with the principles of professional fairness and able to damage other people’s company ”.[12]

Supreme NY has won the court case also thanks to the protection provided by the Madrid Protocol, which establishes the International Bureau of Intellectual Property, where a company from a specific country can register its trademark at, whose protection is ensured for goods or services sold in all the other countries party to the Agreement.[13]

Being part of the Agreement does not imply that every single country is not able to legislate at national level. Indeed, just like Italy, the U.S. presents its own laws on the field which can be found in Title 15 Chapter 22 on Trademarks of the U.S Code.[14]

Other cases[edit]

Supreme case is not the only one, further brands have undergone the same process, i.e. Boy London, Pyrex Vision and Kith NYC. In all these cases both the brand name and logo, the concept and the items themselves were copied from the original company and sold in another country as if they were the original items, however no legal actions have yet been taken.[15]

Boy London[edit]

The original Boy London brand was founded by Stephane Raynor in the UK in 1976. The Italian company Dream Project Spa in Barletta, Italy, has registered the new trademark with the name Boy London Italia copying the brand image while changing little of its logo. Boy London Italia items are available online on the following website https://boy-london.it/. Boy London Italia is probably one of the most successful case of legal fake among young people thanks to the efficient influencers strategy on social media. The official website promotes its items with Italian celebrities and fashion bloggers and football players (https://boy-london.it/friends).[16]

Pyrex Original[edit]

The original Pyrex Vision brand was first created in 2013 in Chicago by streetwear stylist Virgil Abloh. He started the brand as garments for young people, taking inspiration from common high school uniforms from Champion and adding numbers and the Pyrex logo on them so that everybody could feel part of a team. The brand became famous thanks to VIPs such as Kanye West wearing them which helped the brand become a ‘hype’ phenomenon. Pyrex Vision is no longer available as only one collection was produced. However, Italian garments producer Moda Effe Srl in Barletta, Italy, still sells the same items with the trademark Pyrex Original[17].

Kith Official[edit]

Kith NYC has undergone the same process for Pyrex Vision and Boy London, having its brand registered in Italy by Nifra Snc in Barletta under Kith Official[18]

Influencers, strategy and cybersquatting[edit]

Legal fakes are possible because they take advantage of the ‘uninformed’ consumer who can be easily deceived and influenced by the latest trends promoted through celebrities endorsement and social networks or digital platforms. It’s no coincidence that this phenomenon makes use of celebrities endorsement. Indeed, it is now among the most widely used communication strategies which have recently proved to be efficient and able to reach the goal of credibility among consumers.[19] Legal fakes strategy exploits brands fame making their products more easily available on the market and at lower prices unlike the original companies which are niche brands selling limited edition items. A further key point of legal fake related to consumers’ deceit is cybersquatting. This implies the creation of a new website using an almost identical internet domain while adding words such as ‘official’ or ‘original’ which make consumers trust the brand, not knowing it is fake. An example of this is the following website for Pyrex https://www.pyrexoriginal.com/.

Consumer rights[edit]

The question of how consumers can protect themselves from counterfeit and being deceived needs to be mentioned. Information and a corresponding compensation possibility to counterfeit are key points that consumers need to be aware of. The United Nations General Assembly has itself worked on this issue and provides a list of eight principles. After J.F. Kennedy employed the term ‘consumer rights’ in his address to the U.S. Congress in 1962, it has been extended to issues dealt by supranational organisations such as the European Union and the United Nations. The latter has adopted in 1985 a set of eight consumer rights as guidelines for consumer protection.[20] The three most relevant for the topic of legal fake are the following:

  • 2. Right to be Informed to be given the facts needed to make an informed choice, and to be protected against dishonest or misleading advertising and labelling;
  • 6. Right to Redress to receive a fair settlement of just claims, including compensation for misrepresentation, shoddy goods or unsatisfactory services;
  • 7. Right to Consumer Education to acquire knowledge and skills needed to make informed, confident choices about goods and services, while being aware of basic consumer rights and responsibilities and how to act on them.

References[edit]

  1. ^ "Supreme Italia: story of a 'legal fake'".
  2. ^ "Il caso "Supreme": dall'imitazione alla concorrenza parassitaria". 29 June 2017.
  3. ^ "The Story Behind Supreme's Fake Italian Brand - Highsnobiety". 19 April 2018.
  4. ^ "Store Managers Weigh in on the "Legal Fake" Supreme Epidemic That's Spreading in Italy".
  5. ^ Three Judgments from Tribunale di Milano: January, 26th 2017; April, 20th 2017; January, 26th 2018
  6. ^ "Fuck Em all'italiana: il caso di Supreme Barletta". 21 November 2016.
  7. ^ "Il Caso SUPREME di Barletta e lo strano fenomeno dei Legal Fake". www.superflylab.com.
  8. ^ "Tribunal document" (PDF). www.giurisprudenzadelleimprese.it. 20 April 2017.
  9. ^ "Supreme Italia - The case of "parasitic competition"".
  10. ^ "Supreme Wins Lawsuit Against Italian Counterfeit". 19 April 2018.
  11. ^ "Supreme Wins Counterfeit Legal Battle in Italy".
  12. ^ Italian Civil Code – section II ‘della concorrenza sleale’, art. 2598
  13. ^ WIPO, ‘Madrid Protocol concerning the International Registration of Marks’, article 1
  14. ^ U.S. Code - Title 15, Chapter 22, Subchapter III, § 1125 ‘False designations of origin, false descriptions and dilution forbidden’
  15. ^ "Il fenomeno dei LEGAL FAKE in Italia (attenzione ai marchi Supreme, Pyrex, Boy London, Kith, Thrasher)". 2 June 2017.
  16. ^ "BOY London Italia - Phenomenology Of The Legal Fake Made In Barletta".
  17. ^ "Virgil Abloh's Pyrex Vision Brand Is Still Alive - Highsnobiety". 19 April 2018.
  18. ^ "Kith NYC Made in Barletta - the new legal fake".
  19. ^ R. Chiosa, ‘Celebrity Endorsement in Fashion Print Advertising’, EuroEconomica, Issue I (32)/2013
  20. ^ G. Larsen, R. Lawson, ‘Consumer Rights: An Assessment of Justice’, Journal of Business Ethics, February 2013, Volume 112, Issue 3, pp 515–528