25 October 2021Alex Baldwin

Shanghai court charges 69 over fake Chanel, Gucci, and Cartier goods

The Shanghai Pudong Court has tried 69 members involved in two counterfeiting operations that sold fake Chanel, Gucci, and Cartier products.

In an  announcement on October 21, the court revealed that members of a counterfeit luxury clothing operation were handed fines ranging from 5,000 RMB to 11.7 million RMB ($1.8 million), as reported by  National Law Review.

The defendants, referred to as Liu and Zhang, organised a group of employees, as well as outside processing facilities to produce counterfeits of luxury brands, netting more than 42.4 million RMB in sales.

The business reproduced clothing from Chanel, Gucci, Dior, Balennciaga, Fendi, Loewe, and LV according to the court.

According to the announcement, Liu ran the operation and Zhang would purchase the genuine clothes for reproduction at a design office, before being sent to an original equipment manufacturer (OEM) factory for mass production before heading to stores.

The supply chain also involves “dozens” of people including designers, pattern designers, quality inspectors, and salespeople.

For leading the enterprise Liu was sentenced to five years and nine months in prison. Three other defendants, Zhang, Wang, and Li were also sentenced and fined at the Pudong trial.

Earlier, another 44 defendants involved in the business were handed prison terms, ranging from one year and six months to four years and three months.

Jewellery sales

The court also found that defendants Huang, Liu, and Luo were guilty of producing counterfeit Cartier, Van Cleef & Arpels, and Piaget jewellery through online storefronts on social networks Taobao and WeChat.

On October 22, 2020, Chinese public security personnel seized the counterfeit jewellery and packaging boxes.

Following a trial, 21 defendants were found to have used trademarks identical to registered marks without permission to net more than 700,000 yuan in sales.

Counterfeit crackdown

These two rulings follow continued pledges from the Chinese government to crack down on online counterfeiting

Last month, the State Administration for Mark Regulation (SAMR)  released a draft amendment for public consultation that promises tougher penalties for those selling fake goods.

Earlier this year,  WIPR spoke with Jenna Curtis, director of brand programmes at Corsearch and a guest speaker on  WIPR Trademarks Live, to discuss how exactly brands should adapt their protection approach when fighting against counterfeiting in China.

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