Fake Fashion — Real Problem
Funding The Dark Side Of Designer Counterfeits

As the global market grows hungrier for couture style, designer knockoffs have rolled out quicker and cheaper, and are gaining consumer acceptance. But the dark side of the style wars is also growing more sophisticated and aggressive: counterfeit fashions, a cheap and seemingly harmless shortcut to glamour, are making new inroads out of the black market and into American malls and boutiques. They may not all have a seedy underbelly waiting to reap the profits, but the percentage that does is staggering. The fact is, there’s no way to tell where the money will end up — by and large, counterfeit apparel supports sweatshops, child labor, totalitarian governments, and international terrorism.

In contrast, designer knockoffs trade, often quite brazenly, on the innovations of leading designers. While Karl Lagerfeld and Louis Vuitton may cry theft, savvy consumers are less upset. This year’s favorite Oscar frock will be a prom staple via copyists like ABS and edressme.com. European "fast fashion" boutiques like Zara and TopShop have exploded in Europe (Spain’s Zara boasts 2.8 billion euro in annual revenue; TopShop’s parent company, Arcadia Group, has holdings worth 1.7 billion pounds), and they are coming to America in force very soon.

But when do haute couture knockoffs become ripoffs? Intellectual property attorney Susan Scafidi says, "It’s all about the label. The underlying design is not protected at all under U.S. law." As the author of Who Owns Culture? and curator of fashion legal news clearinghouse counterfeitchic.com, Scafidi polices the scoundrels of the fashion industry, where clear-cut imitation can be tough to prove in court. "It depends on how close the knockoff is to the original. If it’s an interpretation of a trend — say, everyone in yellow dresses — then that’s something the industry wants, because it will sell more yellow dresses. If the knockoff is very literal down to the last detail, there’s a problem. At the high end of the industry, there are strong social norms against that kind of copying." Some iconic houses have even used their lines to comment on the rising tide of mimicry. Designer Yohji Yamamoto shocked Paris last month with a fall collection emblazoned with an unsubtle imitation of the oft-counterfeited Louis Vuitton monogram.

The domestic knockoff market took in $10 billion last year, and runs the gamut from clever reinventions of pricey couture accessories, such as the rubber pseudo-Gucci bag, to rank imitations.

A recent U.K. survey showed that many discriminating, upscale consumers knowingly buy fake fashion. The misperception of buying fakes as harmless persists, where the victims are lofty designers and corporations. Counterfeiters thrive on this attitude, which annually puts an estimated $500 billion worldwide — much of it from America — in uncertain hands. According to New York police commissioner Raymond Kelly, the 2004 Madrid bombings were partially funded by sales of counterfeit goods.

With Korea and Vietnam close behind them, China accounts for 60 percent of America’s counterfeit merchandise. Despite its burgeoning economic clout, China remains a totalitarian state with a dismal human rights record. Critics observe that letting counterfeit brand names siphon wealth off Western economies seems to benefit China much more than would an honest crackdown.

International counterfeit traffic rose 1000 percent from 1998 to 2004. In 2005, the president signed HR32, the Stop Counterfeiting In Manufactured Goods Act, which set prison sentences and forfeiture provisions, as well as singling out counterfeit labels, to reflect the problem. But international customs officials say they’re losing.

Designer knockoffs are a far less serious, but more slippery problem, better left to the civil courts, and the innovation of the couturiers themselves. "A lot of the smarter fashion houses are learning to knock themselves off," Scafidi points out. "Fifty years ago, the couture created, and everyone copied. Now, you have Armani doing everything from couture to jeans and T-shirts."

Scafidi notes that removing fake goods from the landscape is like "cleaning up the graffiti and broken glass that makes the neighborhood look so dangerous," thus discouraging more serious crime. But until consumers realize what their money is feeding, the counterfeiters will persist.

The real root of the problem lies in getting consumers to fixate less on the status of labels, and to embrace the power of personal style. Local style consultant Leonard Simpson (www.fashionforward.com) nails the crux of the problem, and gets to the heart of the solution. "Everyone should be able to enjoy fashion, color, and art. It’s what keeps us alive. But if the label is what’s making them happy, then they should ask themselves why they like the bag. If you can afford Louis Vuitton, then get it. But if you can’t, then find something artistically beautiful that you can; find a younger designer, or design it yourself. Be a leader in fashion and in self-esteem. Don’t be a follower."
— Cody Goodfellow