Managing Partner / Patent Attorney of the Russian Federation / Eurasian Patent Attorney
Consumer Goods Sold Under Another Brand Name Without Brand Owner Authorization: Counterfeit, Knockoff or Fake?
How shall we correctly call products that have an illegally used trademark and whether there are differences between the concepts of counterfeit, knockoff and fake?
It is for a purpose that entrepreneurs and manufacturers of goods register the trademarks they use. Registration and acquiring a certificate of protection is the main way to confirm the legitimacy of the trademark owner’s rights.
Modern economic markets are not limited to the territory of one country and offline mode of trade. This leads to the fact that controlling the integrity and legality of the actions of entrepreneurs is becoming increasingly difficult. Therefore, self-control on the part of producers for observance and non-infringement of their rights has particular importance. In this aspect, the registered trademark gives a distinct advantage, as in the case of illegal actions, the right holder has an official confirmation of owning the trademark and exclusive rights, and therefore having every reason to prohibit others from using the registered identity without the right holder’s consent.
When the media describe offenses in the field of trademarks, they most often mention counterfeit goods, knockoff and fake. However, for most readers it remains unclear whether these concepts differ from the legal perspective.
The Civil Code of the Russian Federation (hereinafter the Civil Code) defines counterfeit embodiments and counterfeit goods, also listing the unlawful actions that are associated with such objects. Part 4 of Article 1252 of the Civil Code states: “If the manufacture, distribution or other use as well as import, transportation or storage of embodiments in which a result of intellectual activity or visual identity is expressed, leads to a violation of the exclusive right to such result or identity, such embodiments are considered counterfeit”. The counterfeit goods are specified in part 1 of Article 1515 and part 4 of Article 1519 of the Civil Code. Counterfeit should include goods where a registered trademark is used in any way illegally.
The mentioned rules of the Civil Code allow to conclude that the production and other use of counterfeit goods is connected with the illegal use of intellectual property or visual identity, and such objects must be expressed in tangible form. That is, for example, disclosure of the secret of production will not be counterfeit, just as the products counterfeited without the use of someone else’s intellectual property will not be counterfeit.
The Civil Code does not contain the concept of “knockoff”. However, there is a legal definition of the term. For example, Article 1 of the Federal Law on Quality and Safety of Food describes knockoff food, materials and other products: “...food, materials and other products deliberately altered (counterfeited) and (or) having hidden properties and quality, information about which is knowingly incomplete or untrustworthy”.
There is also a definition of a knockoff drug: “... a drug accompanied by false information about the composition and (or) the manufacturer of the drug”.
The website of the Federal Service for Health and Consumer Rights states: “When goods are knockoff, one or more characteristics of the goods are usually falsified... Food products are mostly counterfeited...”.
Thus, knockoff is associated with a deliberate distortion or alteration of the characteristics and properties of goods. In this case, the transformations have a negative character and can cause harm to the health of consumers.
There is no description of this term in the aspect of the use of trademarks. The Ushakov’s Dictionary gives the following definition: “Something which is counterfeited, an imitation, an object made in the likeness of something real, a fake object, passed off as real”. From the above, we can conclude that a fake is an imitation or falsification of an original product. Thus, faking will be both full copying and distortion of individual qualities or characteristics. Consequently, both counterfeit and knockoff goods can be called fakes.
Summarizing the above, we can conclude about the relationship between the terms counterfeit, knockoff and fake which are often used interchangeably although their legal meanings are not identical.
- Counterfeit goods are goods in which intellectual property is illegally used. The results of illegal actions of the infringer are embodied. In this case, both the distortion of the object of intellectual property, and its unauthorized copying will be considered counterfeit.
- Knockoff is related to the actions associated with the transformation of qualities or properties of the original product. In this case, offenders manufacture products with a distortion of the characteristics of the original, genuine product and pass off such a product as genuine.
- Fake is a non-legal term used to refer to the manufacture of goods in violation of the rights of producers, owners of intellectual property and consumers. Counterfeit goods include imitation, when a product or trademark is copied in its entirety, and faking, when goods are produced with transformations or changes.
If we consider these concepts with regards to protection of the right holder of the trademark, it can be noted that the Civil Code does not divide the illegal use of trademarks into counterfeiting with distortion and complete copying, and allocates only the concept of counterfeit consumer goods. Thus, regardless of how the offenders illegally used a trademark, the actions will qualify as counterfeit. In this case, if they also distort and change the quality of goods, then we can use “counterfeit goods” as a colloquial term, associated with faking.