Intellectual Property Articles 138 Harv. L. Rev. 471

The Counterfeit Sham


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Introduction

There’s a new front in the intellectual property (IP) rhetoric wars. In the past, we’ve seen inflammatory words like “theft” and “piracy” applied to various acts of infringement.1 The specter of “counterfeiting” is frequently — and it seems, increasingly — invoked in discussions of U.S. design patent law and policy.2 “Counterfeiting” is a term of art in U.S. IP law.3 It refers specifically to “the act of producing or selling a product with a sham trademark that is an intentional and calculated reproduction of the genuine trademark.”4 But a design patent isn’t a trademark.5 It’s a totally different type of IP right.6

Why would someone try to conflate design patent infringement with counterfeiting? Because it’s a powerful rhetorical device. After all, “commercial counterfeiting has no apologists and no redeeming features.”7 Few would disagree “that intellectual property law should be used to its fullest extent to suppress” things like “counterfeit pharmaceuticals, counterfeit aerospace spare parts, and counterfeit food.”8 Thus, the word “counterfeiting” tends to evoke a stronger emotional reaction than the word “infringing.”

This type of emotional appeal may be necessary to convince judges and policymakers to grant design patent owners extraordinary benefits and remedies. It may also help disguise measures that benefit private rightsholders as ones that prevent public harms.9 Indeed, we’ve seen a similar rhetorical playbook used before by supporters of increased copyright protections.10 But those who write, advocate for, and make patent law and policy aren’t always aware of copyright literature and policy debates (and vice versa). This Article aims, in part, to bridge that gap.

This is not a matter of mere linguistic imprecision; it’s a case of strategic conflation.11 The problem here is not just that some people are using the word “counterfeit” outside of its specific legal meaning when they talk about design patents.12 The problem is that some people seem to be using the word counterfeit strategically to try to conflate design patent infringement with the worst kind of intentional IP infringement — actual counterfeiting. In some cases, the use of counterfeit rhetoric seems to be an explicit (and fallacious) appeal to fear, attempting to link design patent infringement to the most dangerous kinds of actual counterfeiting such as intentionally selling unsafe car parts or fake drugs.

This Article argues that commentators, policymakers, and judges should not fall for this sham rationale. Additionally, because the words “counterfeit” and “counterfeiting” are so rhetorically loaded, we should reject the suggestions — made by certain legal academics — that we import the concept of counterfeiting into design patent law.13 And whenever it is used in good faith, the word “counterfeiting” should be clearly and prominently defined.

This Article will use the word “counterfeiting” by itself only in this strict, U.S. term of art sense unless otherwise noted. When additional clarity seems helpful or necessary, this Article will use the phrase “actual counterfeiting” to describe the same. Defined this way, the word “counterfeit” means something different than it does in everyday English, where it is often used to refer to something that is “made in imitation of something else with intent to deceive.”14 This Article will refer to this type of activity as “colloquial counterfeiting.”

This Article will use the phrase “counterfeit rhetoric” to refer to situations where the words “counterfeit” or “counterfeiting” are used but where there is no actual counterfeiting at issue.15 Counterfeit rhetoric can occur in discussions of any form of IP.16 But it may be especially pernicious in connection with design patent law because it is an area of IP that isn’t taught (at least not in significant depth) at most law schools and one which is likely to be less well-understood by practicing attorneys, judges, and lawmakers. These audiences might not know, for example, that a design patent may only cover a small and insignificant portion of a product’s overall design.17 That means a product can infringe a design patent without being a replica.18

This Article proceeds in six Parts. Part I provides a brief background of the relevant law, including an explanation of the often misunderstood test for design patent infringement. Part II identifies some ways that counterfeit rhetoric has been used in the context of design patent law and policy, including the (still largely unknown) phenomenon of “Schedule A” litigation.19 Part III explains why there is no necessary legal or logical connection between design patent infringement and counterfeiting — or safety. Part IV situates the contemporary design patent counterfeit narrative in the larger context of IP lobbying and policy. Part V explains why counterfeit rhetoric matters, especially in the context of design patents. Part VI discusses some additional lessons and implications.

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Footnotes
  1. ^ See infra Part IV, pp. 517–26.

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  2. ^ See infra Part II, pp. 487–502. This is the author’s impression, not an empirical assertion regarding timing or frequency.

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  3. ^ See infra section I.A, pp. 475–79.

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  4. ^ 3 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 25:10 (5th ed. 2024); see also infra section I.A, pp. 475–79.

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  5. ^ At least, it doesn’t have to be. For a discussion of when and how these regimes can overlap, see infra section I.C, pp. 486–87.

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  6. ^ See infra section I.B, pp. 480–86

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  7. ^ Christopher Wadlow, “Including Trade in Counterfeit Goods”: The Origins of TRIPS as a GATT Anti-Counterfeiting Code, 2007 Intell. Prop. Q. 350, 350.

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  8. ^ Barton Beebe, Shanzhai, Sumptuary Law, and Intellectual Property Law in Contemporary China, 47 U.C. Davis L. Rev. 849, 872–73 (2014).

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  9. ^ Cf. J. Janewa Osei-Tutu, Private Rights for the Public Good?, 66 SMU L. Rev. 767, 769 (2013) (discussing similar arguments made with respect to trademarks and copyrights).

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  10. ^ See infra section IV.A, pp. 518–19. The attempts to link copyright infringement — as well as unregistered trademark infringement — with counterfeiting continue. See, e.g., Complaint ¶¶ 2–3, 7, 30, Art Ask Agency v. Individuals, Corps., Ltd. Liab. Cos., P’ships, & Unincorporated Ass’ns Identified on Schedule A Hereto, No. 1:23-cv-02163 (N.D. Ill. Apr. 6, 2023), ECF 1 (using the word “counterfeit” liberally in a case alleging copyright and regular trademark infringement, even though the plaintiff did not mention — let alone assert — any registered trademarks); Complaint ¶ 1, Liforme Ltd. v. Individuals, Corps., Ltd. Liab. Cos., P’ships & Unincorporated Ass’ns Identified on Schedule A to the Complaint, No. 1:23-cv-14195 (N.D. Ill. Sept. 27, 2023), ECF 1 (“This action has been filed by Plaintiff to combat online counterfeiters who trade upon Plaintiff’s reputation and goodwill by selling and/or offering for sale products in the United States in connection with Plaintiff’s copyright, specifically Plaintiff’s U.S. Copyright Office Registration No. VA2-311-816 (the ‘LIFORME Copyright’ or ‘LIFORME Copyright Registration’) . . . .”); see also Complaint ¶¶ 23–24, Antsy Labs, LLC v. Stress Cube, LLC, No. 2:17-cv-09146 (C.D. Cal. Dec. 21, 2017), ECF 1 (alleging infringement of an unregistered trade dress).

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  11. ^ Of course, some users of counterfeit rhetoric may be merely copying other, more strategic, actors. But even when a particular user is not acting with subjectively strategic intent, their use of counterfeit rhetoric may still be confusing and harmful.

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  12. ^ At least, outside of its specific legal meaning under U.S. law. International usage varies. For more on this, see infra note 26 and accompanying text.

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  13. ^ See infra section VI.B, pp. 529–30.

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  14. ^ See Counterfeit, Merriam-Webster, https://www.merriam-webster.com/dictionary/counterfeit [https://perma.cc/7W73-VFZ9]. At least one article has suggested that this definition should be used in the context of design patents. See Elizabeth Ferrill & Tina Tanhehco, Protecting the Material World: The Role of Design Patents in the Fashion Industry, 12 N.C. J.L. & Tech. 251, 254 (2011) (“A counterfeit represents a nearly exact duplicate of an item sold with the intent to be passed off as the original.” (citing the Merriam-Webster definition of “counterfeit”)).

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  15. ^ So, for example, if a plaintiff alleged that the sale of a particular product constituted both actual counterfeiting and design patent infringement, they would not be engaging in counterfeit rhetoric if they described the accused product as a “counterfeit.” But the plaintiff would be engaging in counterfeit rhetoric if they alleged only design patent infringement and had no colorable claim for actual counterfeiting.

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  16. ^ E.g., Plaintiff’s Complaint for Patent Infringement ¶¶ 33–34, Lead Creation, Inc. v. P’ships & Unincorporated Ass’ns Identified on Schedule “A,” No. 8:23-cv-00049 (M.D. Fla. Jan. 6, 2023), ECF 1 (using counterfeit rhetoric in a utility patent case); Complaint for Damages and Injunctive Relief ¶¶ 11, 28, Gorge Design Grp., LLC v. Syarme, No. 2:20-cv-01384 (W.D. Pa. Sept. 15, 2020), ECF 2 (same).

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  17. ^ See infra section III.A.2.a.i, pp. 503–07.

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  18. ^ See infra section III.A.2.a.i, pp. 503–07.

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  19. ^ Because the defendants in these cases are usually listed on a document called “Schedule A,” judges and others have started referring to them as “Schedule A cases.” E.g., Zorro Prods., Inc. v. Individuals, Corps., Ltd. Liab. Cos., P’ships, & Unincorporated Ass’ns Identified on Schedule A Hereto, No. 1:23-cv-05761, 2023 WL 8807254, at *2 (N.D. Ill. Dec. 20, 2023) (“The factories churning out fake goods are rivaled by the factories of law firms churning out Schedule A case after Schedule A case.”). In an important essay, Eric Goldman identifies and describes this phenomenon. See Eric Goldman, A SAD Scheme of Abusive Intellectual Property Litigation, 123 Colum. L. Rev. F. 183, 184 (2023). While Goldman focuses on trademark Schedule A cases, see id. at 185, this Article will focus on patent Schedule A cases.

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