Knocking the Knockoffs

Since 1977, Aktion Plagiarus has been has been a thorn in the side of counterfeit-product makers. Each year, the German organization bestows its Plagiarius Awards on manufacturers or distributors that flood the German market with the most egregious of knockoffs. (Here, check out the 2007 and 2008 winners). These booby prizes for product plagiarists are given at Ambiente, the annual consumer products fair in Frankfurt, with the hope that the negative press will deter would-be pirates. It has worked, too. Some manufacturers have pulled their products from the market as soon as they were nominated. But the Plagiarius Awards don't just aim to embarrass culprits. They are also a chance to bring awareness to the many dangers of counterfeiting.

As managing director of Berlin's Action Group against Product & Trademark Counterfeiting, Doris Moeller is more familiar with those dangers than most. Moeller, one of the judges of this year's awards, has spent 15 years raising public awareness about the issue. Moeller recently spoke to BusinessWeek's Damian Joseph about the Plagiarius Awards and problems associated with counterfeiting, including issues of consumer safety, organized crime, and the large sums of money businesses must pay to protect their patents. An edited version of their conversation follows:

How exactly did you judge these awards?

The jury [which also included several lawyers, professors, and journalists] looked at about 30 infringements. Products are included if the [counterfeiting] behavior is incredible, former employees are involved, or there are hints that the [plagiarist] got the information in an incorrect way. Each of the products in question has to be sold on the German market.

What are the repercussions of receiving an award?

There is a press conference that goes with the awards at which the companies are publicly blamed for bad behavior. That affords an opportunity to make issues like counterfeiting and piracy public. I think the media coverage really harms the producers hit by an award.

Why should businesses care about plagiarism?

I think they should care especially in this moment of financial crisis as it takes a lot of money away from the [makers of the original product]. If you have to fight against copyright infringement, spend money on an investigation, track down the plagiarist, and then file complaints for civil prosecutions, that takes a lot of time. And time is money. If counterfeiting steals part of the market, the original product won't be bought any more. It's dangerous for employment and could lead to bankruptcy.

Why should consumers care?

Most counterfeited products are consumer products: textiles, perfumes, anad other merchandise. A lot of the entries in the awards system are fake technical equipment that might harm the consumer. You never know the ingredients that are used which could be toxic. Also, organized crime is often behind these counterfeit products. It's very dangerous. The whole of society must be aware, because very often it's criminal.

Here, see the "winners" of this year's Plagiarius Awards.

Before it's here, it's on the Bloomberg Terminal.