Louis Vuitton is a quite a desirable luxury brand–so desirable, in fact, that its logo is often put on counterfeit goods trying to pass off as official Louis Vuitton goods. Interestingly, the logo also makes its way to goods that would never, ever be associated with the Louis Vuitton brand. The ‘Design You Trust’ blog collected several great examples; you can see the whole gallery here. Here are a few of my favorites:

It’s great to be a desirable brand, but having the LV logo on things like these could dilute its value. I wonder how Louis Vuitton balances the need to police the marketplace for counterfeit goods versus the need make real Louis Vuitton goods exceptional.

Most people go to an art museum to appreciate fine art and broaden their cultural horizons. Is this still the case when the art on display is known to be fake? Next year the Brooklyn Museum in New York will put on a show featuring pieces of Coptic sculpture known to be counterfeit. Acquired between the late 1950s and early 1970s, these pieces have never before been shown to the public, and their provenance is dubious at best. One example from a recent article in the New York Sun:

One New York dealer, Jerome Eisenberg, acknowledged in a phone interview that he had sold the museum one piece now considered to be fake, a roundel with a border of palm fronds and a central bust. The museum acquired the piece in 1960.

Asked where he bought the roundel, Mr. Eisenberg said that he purchased it from a “very reliable, very ethical” dealer in Cairo, a Copt named Kamel Hammouda. Asked if he knew where Mr. Hammouda got the sculpture, Mr. Eisenberg said that it was against the rules of the trade at the time to ask such questions.

“When you’re buying antiquities in Egypt or Beirut or Turkey or Algeria, you don’t ask the dealer who dug things up,” he said.

Hopefully the museum will provide enough information in the exhibition such that visitors can learn what characteristics make these pieces forgeries–that will certainly foster the connoisseurship of Egyptian art.

[Photo by Dan Diffendale]

Tiffany was in the news this week, not for a new line of diamond rings or earrings but because it lost the long-running lawsuit it’s had with eBay about the sale of counterfeit Tiffany goods on the site. Tiffany maintains that eBay knowingly encouraged sellers to dilute Tiffany’s value and trademarks by not putting a stop to counterfeit Tiffany listings on the site. Rather than resting with eBay, the burden for identifying counterfeit goods rests with Tiffany, who have to report counterfeit listings to eBay and have eBay remove them. EBay argues that like YouTube it’s up to the trademark holder to report false listings, and they already take enough action against counterfeit items because these are bad for their marketplace.

This American ruling is interesting because it diverges from recent findings in European courts. In Germany a ruling for Rolex found that eBay must make greater preventative measures against the sale of counterfeit Rolexes, and in France eBay was ordered to pay Louis Vuitton 40 million euros in damages for the sale of counterfeit goods.

Counterfeit goods damage brand value–if discovered, they’ll upset people who purchase them and receive them as gifts; they mock the effort that people make to show their love and appreciation for one another. The takeaway from this case is that one needs to be careful when make purchases from a source that hasn’t been completely vetted. When a deal sounds too good to be true, it probably is.

[Photo by minxlj]

Following the recent New York and London Fashion Weeks, fashion has been a popular topic in the news and two stories are particularly worthy of mention in light of the counterfeit goods news we’ve been following recently.

First, this article in the New York Times discusses the speed with which copycats are taking couture designs to low and mid-range department stores–knockoff items can go from catwalk to shelf in as quickly as four to six weeks. The knockoff company discussed in the article can turn a photo emailed to the factory into a finished sample in 14 days. It can be months before the couture houses are ready to sell their wares–items from fall shows traditionally make it to high end shops by February.

Couture design aren’t subject to copyright, so fashion houses (through trade associations) are now pushing for protections similar to those criminalizing counterfeit goods in order to stop losing money from knockoffs.

But this article from the New Yorker suggests that this might not be wise. While counterfeit goods can fund unsavory black markets and activities, knockoffs feed the fashion industry in two useful and important ways.

First, the people who purchase couture knockoffs from H&M or Zara are not the same people who spend ten times as much to purchase a similar garment at Neiman Marcus. Arguably the couture houses really aren’t losing customers or business to knockoffs–and exposure to ‘couture-inspired’ designs may make young customers more willing to purchase the real thing in the future.

And second, knockoffs help the fashion industry induce obsolescence to fuel demand for new clothes. Couture houses need people to want to buy their garments season after season–what better way to make people desire new things than make them tired of what they have? Seeing ‘everyone’ wearing similar styles (through affordable knockoffs) makes neophiles willing to spend on the latest and greatest.

While counterfeit goods are clearly a problem, knockoff goods have a more symbiotic relationship with couture houses. They provide an interesting example of how businesses can be successful creatively and monetarily despite a lack of copyright protections.

All our recent talk about counterfeit goods lends itself nicely to this discussion of counterfeit wines on Slate.

The article does a nice job of discussing perhaps the largest counterfeit wine story in recent memory, a story involving Thomas Jefferson, forgery, and multiday bacchanals. In 1988 Bill Koch purchased 4 bottles of wine said to be owned by Thomas Jefferson (they were signed Th. J) for $500,000. Two years ago he had the bottles authenticated and found that Jefferson, a meticulous record keeper, had never noted the bottles and that the signatures were forged. Koch is now suing the man who sold him the wine, a German music promoter and wine merchant (best known for his bacchanalic parties) by the name of Hardy Rodenstock.

How widespread are counterfeit wines? Because many vineyards lack proper records about how much wine was produced and where it went, taste can be the best means of authentication. And according to Allen Meadows, a renowned Burgundy critic, about 10% of the pre-1960 wines that he tastes these days are fraudulent. In the article Meadows notes that in some wine circles alleging fraud is becoming a mark of connoisseurship–it “show[s] off their knowledge and the acuity of their palates.” One hopes that aspiring wine connoisseurs aren’t falsely accusing wines that only taste “young” to seem more knowledgeable than than they are.

Read the full article here.

As we mentioned in this recent post, buying a fake handbag can feel like a victimless crime. The buyer might feel good about saving money–perhaps even bragging to friends about it–and think that the luxury company won’t miss the revenue from a single bag. But purchasing counterfeit handbags and other goods might not necessarily be consequence free. Dana Thomas wrote an article for the New York Times last month that highlights several illicit activities and organizations that stem from counterfeiting:

Most people think that buying an imitation handbag or wallet is harmless, a victimless crime. But the counterfeiting rackets are run by crime syndicates that also deal in narcotics, weapons, child prostitution, human trafficking and terrorism. Ronald K. Noble, the secretary general of Interpol, told the House of Representatives Committee on International Relations that profits from the sale of counterfeit goods have gone to groups associated with Hezbollah, the Shiite terrorist group, paramilitary organizations in Northern Ireland and FARC, the Revolutionary Armed Forces of Colombia.

Trying not to sound overly preachy or like a scaremonger, these organizations should not–must not–be funded by counterfeit goods. What can luxury companies do to stop them? They can’t necessarily go after counterfeit manufacturers themselves–that’s the job of law enforcement–but they can be transparent and acknowledge that counterfeiting is a serious problem they face. Too many luxury companies worry that talking about the problem will make more people aware of it thereby tarnishing their reputations. But the counterfeit problem is real and will become worse if companies ignore it.

If luxury companies can give people a better reason to stop purchasing counterfeit goods, everyone will be better off.

Counterfeit goods are a major problem for luxury brands. They remove the exclusivity that luxury brands carefully cultivate and in many cases take the place of goods that affluent people would otherwise purchase. It feels like a victimless crime to purchasers–they might think that with these these goods so in demand and these companies so rich, a single purchase won’t make a difference. But enough people around the world are thinking this way that it is affecting the bottom lines of luxury companies. Authenticity is changing from necessary to optional, and two items in the media this month highlighted this fact.

The first is an article in the UK’s Independent about the fakery related to luxury goods, enhanced physical appearance (via surgery, botox or Photoshop), and ‘reality’ television. For decades celebrities have had a symbiotic relationship with fashion houses–the houses provide clothing and jewelry to make celebrities look beautiful on the red carpet, and the celebrities in turn mention who made their dresses, earrings and other ephemera. But recently a few celebrities (Renee Zellwegger, Courtney Love and Britney Spears are named in the article) have been photographed with counterfeit handbags or dresses, sending the message to the public that it isn’t just legitimate to purchase counterfeit goods, it’s glamorous too. Read the article here.

Earlier this month the BBC Radio 4 consumer affairs program You and Yours ran a similar story, about how the Italian government is cracking down on counterfeit goods. The government believes such goods are costing the country nearly $10 million a year, so it’s taking action by putting tougher customs controls in place and going after wholesalers and importers (rather than the street vendors at the bottom of the chain). You can listen to the whole interview with Silvio Paschi from Indicam, an Italian industry group against counterfeiting, here.

What can turn the tide to make authenticity absolutely necessary again? It’s a similar proposition to keeping luxury brands exclusive as they expand their masstige lines–luxury companies need get the message across that the luxury they offer is incomparable and inexorable–people need to know that the experience and prestige that true luxury offers can’t be matched anywhere.