True Religion Brand Jeans is employing a new weapon in its fight against waves of counterfeiters that have taken their wares from the cold streets to the warmer environs of the Internet.
This story first appeared in the February 18, 2010 issue of WWD. Subscribe Today.
The Vernon, Calif.-based premium denim label was among the first brands to enroll in tests of Site Staydown, a new service from online brand security firm MarkMonitor that promises not only to shut down Web sites hawking knockoffs, but also to keep them closed. MarkMonitor began a wider rollout of Site Staydown this week, noting the apparel and footwear brands involved in the pilot program were able to shut down more than 100 sites they identified as selling counterfeit or pirated goods.
Deborah Greaves, True Religion’s general counsel, said the company noticed an increase in the number of counterfeits being sold online in the summer. While the brand had seen online counterfeiting before, Greaves said Web activity exploded in mid-2009 on sites with dubious domain names like discountbrandjeans.com and myluxuryjeans.com. Some cyber squatters had gone so far as to register domains that included the company’s name.
“It was Whac-A-Mole. Every day there were 10 more popping up,” Greaves said. “It was all coming out of China, and we weren’t having much luck getting them taken down.”
The Site Staydown service patrols the Internet for sites selling counterfeits, generates automatic cease-and-desist letters, and escalates enforcement as needed. One key to success has been MarkMonitor’s focus on the Internet service providers that allow such sites to operate. The company uses its relationships with ISPs and domain name registrars to persuade them to voluntarily remove offenders from servers and networks. MarkMonitor also watches targeted sites to make sure infringing activity doesn’t return on the domain.
Fred Felman, the firm’s chief marketing officer, said MarkMonitor has developed relationships with Internet providers worldwide through its years of work in brand protection and other Internet security issues such as phishing and malware. Felman said Site Staydown leverages those contacts to halt counterfeiters faster than traditional legal options.
MarkMonitor is also leveraging some fresh legal history. In recent years, brand owners have targeted the third-party providers that make counterfeit sales on the Internet possible. In September, LVMH Moët Hennessy Louis Vuitton won a $32.4 million judgment against two Fremont, Calif.-based Web site hosts. A jury in the case found that though the companies hadn’t directly participated in the sale of counterfeits, they had contributed to copyright infringement. Gucci America Inc. joined the trend in August when it sued a bank and two card processors it accused of handling payments to counterfeit dealers. Felman said such cases have made Internet management firms more likely to oblige MarkMonitor’s requests.
Attorney Joseph Gioconda, who heads intellectual property law firm Gioconda Law Group, called such third-party liability the next wave in brand protection and said he’d seen Web providers become more cooperative in the last year.
“The reason it’s happening is that, more often than not, these hosts have assets they want to protect,” Gioconda said.
Gioconda said services like MarkMonitor’s can expedite the process of getting a site down, but likely wouldn’t eliminate the need for a good legal team.
“You’ll get a certain percentage of compliance, but when the infringer persists, then legal action becomes necessary,” he said.
For True Religion, Site Staydown has figured into its solution.
“I have to say that the problem that we had in June, which was very menacing, is now really well contained,” Greaves said. “It’s down now to just minimal…registrars in China [have] quit registering domain names that had our name in them.”