A Contact Sport

 
 
 
 
 
In February, U.S. Customs & Border Protection agents seized nearly $200,000 in fake jerseys, T-shirts and hats from arena parking lots, hotels and flea markets during the NBA All-Star Game. Before the first medal was won at the Winter Olympics in Vancouver, massive amounts of counterfeit goods were being dumped into the area.

Meanwhile, Immigration & Customs Enforcement (ICE) officials, local law enforcement and the NFL have been tallying up the fake merchandise seized at Super Bowl XLIV and from related raids like “Operation Faux Bowl” in South Florida. And officials from Pretoria to Rio de Janeiro are already seeing loads of counterfeit apparel in the run-up to the FIFA World Cup soccer championships this summer in South Africa.

On any given day, shopping bazaars from New York’s Canal Street to Beijing’s notorious “Silk Street” market are swollen with fake licensed sports apparel. The problem has finally attracted the attention of global law enforcement agencies that say this massive revenue stream is finding its way into the coffers of organized crime and funding international terrorism.

Making a dent
“Counterfeiters don’t share their information with us, so whatever data we collect is measured by products seized,” says Ethan Orlinsky, senior vice president and general counsel of MLB (Major League Baseball) Properties. “But we’re part of CAPS (Coalition to Advance the Protection of Sports Logos) along with the NBA, NFL, NHL and the Collegiate Licensing Co. Since 1993, CAPS has participated in seizing 9.6 million units of merchandise valued at about $335 million — a significant share of it related to Major League Baseball.”

More than five million pieces of MLB merchandise have been seized or surrendered as a result of 3,400 raids or actions over the last decade. These include a one-day seizure of 18,000 units confiscated after the parade marking the New York Yankees’ victory in the 2000 World Series, a 2006 raid on a single New York store that yielded close to 40,000 counterfeit caps and the seizure of 124,000 caps by Mexican Customs in 2009. “We think we’re making a dent,” Orlinsky says. “I just can’t put my finger on how large a dent.”

Still, this is merely the tip of a very large and lucrative iceberg that has been a financial drain on collegiate and professional sports in virtually every country – including those that are responsible for much of the production of counterfeit goods.

In fact, the World Customs Organization and the Organisation for Economic Cooperation and Development estimate that counterfeit products of all types account for 5 to 7 percent of all global trade and that sales have grown an astounding 400 percent since the early 1990s. The International Chamber of Commerce estimates that the total cost of counterfeit goods worldwide is around $650 billion.

By any measure, counterfeiting is anything but the victimless crime it was once purported to be. In fact, it and piracy have “expanded to epidemic proportions and are getting bigger,” says David Hirschmann, president and CEO of the Global Intellectual Property Center at the U.S. Chamber of Commerce. “On the other hand, we’ve seen a surge in response from the business community and government to do something about it.”

Hirschmann’s group is primarily concerned with the bigger picture when it comes to theft of intellectual property, but he believes a national strategy is the key to tougher enforcement for all industries. “Everyone has a role to play — Customs in interdictions and investigations and the Department of Justice along with the FBI in enforcement.