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Latest Counterfeit Brand Scam Plagues Collegiate Sports

Posted by Barry Silverstein on January 12, 2012 01:02 PM

Some fans, surprised at the result of the BCS National Championship game Monday night, in which Alabama blanked LSU, would not be surprised to learn that the merchandise sold at the game is big business. But they may be shocked to find out that not all of the merchandise sold there was legitimate.

It turns out that counterfeiting has penetrated the collegiate sports market — fake merchandise was being sold along with the real thing at all of the championship bowl games.

ESPN reports that over 1,000 pieces of unlicensed product with an estimated retail value of more than $15,000 were seized at the SEC championship game in December alone. On average, almost 5,000 fake items are confiscated outside the host stadium of the BCS title game each year, according to Collegiate Licensing Company (CLC), one of several agencies authored to represent collegiate properties.

CLC represents some 200 colleges and universities, as well as bowl games, athletic conferences, the Heisman Trophy, and the NCAA. It's common practice for every college and university to have its name uniquely portrayed in a particular typeface. Most educational institutions also have logos, slogans, team names and other intellectual property that they protect with trademarks. Sometimes the trademarks reach far beyond name and logo alone; in addition to its name and logo, the University of Georgia, for example, has trademarked "Georgia," "Georgia Bulldogs," "Dawgs," "How About Them Dogs," and numerous other words and phrases.

Why? Because every piece of merchandise that carries these trademarks means added revenue for the institution's athletics programs and other activities.

The University of Florida, for example, had more than $6 million of licensing revenue for 2010-11, while Ohio State University budgeted for $3.5 million in licensing revenue for 2011-12, according to ESPN. That's just the institutions — the NCAA and athletic conferences also partake in the riches.

Counterfeiters, recognizing the highly desirable nature of collegiate sports t-shirts, hats, cups, and souvenirs of all types, churn out fakes each year. Emboldened by the fact that the trademark law essentially requires a trademark owner to bring a private lawsuit against a counterfeiter, vendors of illegitimate goods hawk them beside vendors of the real thing. Last year, CLC confiscated in excess of 60,000 fakes valued at more than $1 million. CLC investigators often work with local police at major events in an effort to protect clients' trademarks.

Fake goods are a chronic worldwide challenge for brand marketers. They are sold in every venue, from tony shopping districts to flea markets. In recent years, the problem has been exacerbated by cheap knockoffs coming from China, where trademark law is almost non-existent. A recent bizarre case revolved around fake Apple stores popping up around China. While some studies have suggested counterfeit goods might actually help luxury brands by promoting them, most brand marketers see fakes for what they are -- an insidious way to undermine authentic brand value and siphon off sales from legitimate products.

With the collegiate market now falling prey to fakes, colleges and universities stand to lose. That's why authorized manufacturers have taken to putting an "Officially Licensed Collegiate Products" hologram on the legitimate product or on an accompanying hang tag. Still, fans of the Crimson Tide at the BCS National Championship game may have been happily snapping up any merchandise they could get their hands on after their team's victory -- even if that merchandise wasn't authentic.

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