Counterfeiters and pirates are flourishing on the Internet, scamming customers and stealing from legitimate businesses. Saturday, World Intellectual Property Day, was an opportunity to highlight the role of Intellectual Property (IP) and that there are countless bad actors looking to illegally profit from the ingenuity and investments of others.
I fell victim to one of these counterfeiters, when purchasing an Apple Macbook charger from prontocharger.com. The website had great prices and appeared legitimate, but when I received the charger, it was wrapped in plastic and tape, not authentic Apple packaging.
Within a few weeks, the second charger shorted out. I called Prontocharger again. This time the receptionist told me I would have to pay a hefty warranty fee for a new charger. Then I pressed the receptionist to tell me whether or not they were selling authentic Apple chargers. Silence. Until she asked if I wished to have my card billed for the warranty claim. After giving her an ear full, I hung up the phone.
A search on the Better Business Bureau website revealed that Prontocharger had over 40 official complaints and hundreds more on other consumer review websites alleging that the products were counterfeit.
According to the International Anti-Counterfeiting Coalition, counterfeit and pirated goods are estimated to make up a $600 billion economy. That’s $600 billion in theft from legitimate businesses, threatening future innovation and jobs. Why spend money on research and development, if there will be no return on investment?
Even more egregious, counterfeit drugs and supplements pose serious health and safety hazards. The National Association of Boards of Pharmacy (NABP) found 97 percent of pharmaceutical sales online do not comply with pharmacy laws and practice standards. Who is producing and selling these drugs? The Russian mafia, Columbian drug cartels, and al Qaeda are a few culprits. Buying counterfeit goods is not only dangerous to your wellbeing, but can also fund human trafficking, drug smuggling, and terrorism.
Although U.S. agencies and regulators have stepped up their efforts to rein in bad actors, the Department of Homeland Security found that counterfeiting and piracy are on the rise, up 7 percent in 2013 from 2012. The illegal goods industry is just too big and entrenched to fight with law enforcement alone.
Where the government is falling short, private businesses and organizations have been using the free market to curb abusive IP rights violations. Last year, Internet service providers and content producers established the Copyright Alert System to notify online consumers when their Internet accounts are used for content theft of movies, music, etc. Payment processors like PayPal, Visa, Discover, and Amex adopted best practices standards in 2011, agreeing to discontinue relationships with websites that sell illegitimate products. Likewise, large advertising associations adopted best practices to deter advertising on websites that infringe on IP rights.
However, missing from the mix are search engines. I found Prontocharger using a quick Google search. With 99 percent of counterfeit goods being sold over the Internet, and search engines acting as Internet directories, there is certainly a role for companies like Google to play in decreasing the traffic to illegitimate websites.
Google agreed in 2012 to change their ranking system, whereby websites with high numbers of complaints for copyright infringement would appear lower in search results. However, the Recording Industry Association of America found websites with thousands of infringement complaints still ranked top level in search results.
No one can expect Google to fix the online counterfeit and pirated goods crisis alone. Google continues developing technology to eradicate links to child pornography and warn Internet users about to visit a potentially malicious website. These technologies might be able to warn users when they are about to visit a site repeatedly flagged for counterfeit goods or piracy. It’s a huge undertaking, and Google’s efforts are highly encouraging.
While the public and private sectors cooperate to stop IP theft, consumers must accept personal responsibility. First, if the price seems too good to be true, it probably is. Order from authorized retailers or go straight to the manufacturer. In particular, make sure not to order pharmaceuticals from websites on the NABP’s Not Recommended list. The frustration of ineffective products and threats to your health are not worth it. Lastly, if you suspect illegitimate goods sales, report the website at stopfakes.gov.
For World Intellectual Property Day let’s celebrate intellectual achievements, and raise awareness of future efforts to protect innovators. We can decrease the demand for illegitimate goods that fund organized crime and undermine our economy by being educated consumers.
Golwick is an associate at Digital Liberty and Americans for Tax Reform.