I suspect when the law calls a company a person, this might not be
a planned consequence...
Udhay
http://www.iht.com/articles/2006/04/27/business/nec.php
Next step in pirating: Faking a company
By David Lague International Herald Tribune
FRIDAY, APRIL 28, 2006
BEIJING At first it seemed to be nothing more than a routine, if
damaging, case of counterfeiting in a country where faking it has
become an industry.
Reports filtering back to the Tokyo headquarters of the Japanese
electronics giant NEC in mid-2004 alerted managers that pirated
keyboards and recordable CD and DVD discs bearing the company's brand
were on sale in retail outlets in Beijing and Hong Kong.
Like hundreds, if not thousands, of manufacturers now locked in a war
of attrition with intellectual property thieves in China, the company
hired an investigator to track down the pirates.
After two years and thousands of hours of investigation in
conjunction with law enforcement agencies in China, Taiwan and Japan,
the company said it had uncovered something far more ambitious than
clandestine workshops turning out inferior copies of NEC products.
The pirates were faking the entire company.
Evidence seized in raids on 18 factories and warehouses in China and
Taiwan over the past year showed that the counterfeiters had set up
what amounted to a parallel NEC brand with links to a network of more
than 50 electronics factories in China, Hong Kong and Taiwan.
In the name of NEC, the pirates copied NEC products, and went as far
as developing their own range of consumer electronic products -
everything from home entertainment centers to MP3 players. They also
coordinated manufacturing and distribution, collecting all the proceeds.
The Japanese company even received complaints about products - which
were of generally good quality - that they did not make or provide
with warranties.
NEC said it was unable to estimate the total value of the pirated
goods from these factories, but the company believed the organizers
had profited substantially from the operation.
These entities are part of a sophisticated ring, coordinated by two
key entities based in Taiwan and Japan, which has attempted to
completely assume the NEC brand, said Fujio Okada, the NEC senior
vice president and legal division general manager, in written answers
to questions.
Many of these entities are familiar with each other and cooperate
with each other to develop, manufacture and sell products utilizing
the NEC brand.
NEC declined to identify the companies for legal reasons.
Officials from branch offices of the Chinese State Administration of
Industry and Commerce in southern China confirmed that counterfeit
goods carrying the NEC brand had been seized in raids on a number of
factories and that investigations were continuing.
Some technology companies have been criticized for piecemeal and
half- hearted attempts to protect their intellectual property, but
Okada said NEC was prepared to take proactive measures to defend its brand.
NEC had not previously made public the piracy in order not to
compromise its investigation.
NEC said it would continue collecting evidence to support further
criminal complaints. It was also planning to start civil lawsuits
against some factories while negotiating with others.
Steve Vickers, president of International Risk, a Hong Kong-based
company that NEC hired to investigate the piracy, said documents and
computer records seized by the police during the factory and
warehouse raids had revealed the scope of the piracy.
These records showed that the counterfeiters carried NEC business
cards, commissioned product research and development in the company's
name and signed production and supply orders.
He said they also required factories to pay royalties for licensed
products and issued official-looking warranty and service documents.
Some of the factories that were raided had erected bogus NEC signs
and shipped their products packaged in authentic looking boxes and
display cases.
NEC said about 50 products were counterfeited, including home
entertainment systems, MP3 players, batteries, microphones and DVD players.
Many of these pirated items were not part of the genuine NEC product range.
The investigation also revealed that fake goods from these factories
were on sale in Taiwan, mainland China, Hong Kong, Southeast Asia,
North Africa, the Middle East and Europe.
In some cases, they were being sold alongside legitimate NEC products
in retail outlets.
Vickers, a former senior Hong Kong police officer, said he believed
that the NEC case demonstrated how piracy is evolving from
opportunistic and often shoddy copying of branded goods to highly
coordinated operations.
On the surface, it looked like a series of intellectual property
infringements, but in reality a highly organized group has attempted
to hijack the entire brand, he said. It is not a simple case of a
