Counterfeiting

Counterfeiting also applies to reproductions of packaging when the intent is to defraud or to violate protections under TRADEMARK, COPYRIGHT, or patent laws. It is estimated that U.S. companies lose $8.1 billion annually in overseas business owing to violations of INTELLECTUAL PROPERTY laws. Increasing the enforcement of trademark and copyright law to discourage counterfeiting has been a focus of U.S. trade negotiations, both with individual countries and during the Uruguay Round of the international GENERAL AGREEMENT ON TARIFFS AND TRADE, Pub. L. No. 103-465, 108 Stat. 4809 (1994).

Disputes over counterfeit CDs and computer software have been at the center of U.S. trade conflicts with China for several years. Software manufacturers claim that 98 percent of the software used in China, including that used by the government, was illegally copied. Other goods that are distributed under false trademarks include cereal, razor blades, and soap. Under pressure from the United States, China strengthened its copyright and trademark laws in 1993. Lax enforcement resulted in a new trade agreement in 1995, which was designed to give U.S. manufacturers greater access to Chinese markets. Nevertheless, counterfeiting in China remains rampant.

Although most counterfeiting allegations are brought through the criminal courts, counterfeiting that violates patent, trademark, or copyright laws has resulted in civil lawsuits. For example, in 1994, a Paris court found that designer Ralph Lauren had copied a tuxedo dress pattern from Yves Saint Laurent's collection and ordered Lauren to pay his competitor $386,000 in damages.