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Law Times • January 26, 2009 FOCUS PAGE 11 ness, he spent a lot of time inves- tigating flea markets. Cheap T-shirts were the big business then. But since that time, bogus products have gradually moved up the chain to higher-end clothes, shoes, toys, video games, and prescrip- tion drugs. At the same time, the counterfeiters themselves climbed up the ladder. Retail stores got into the business too, meaning the game was no longer just the purview of flea markets. Now, however, the counterfeit trade has come full circle, says Lipkus. In many cases, the flea markets are not just the retail- ers of fake goods; they're also the suppliers. "You would think that the stores are the bigger business. I would dispute that. The coun- terfeiters are going to the flea markets to do their wholesaling." The trend, Lipkus adds, can complicate the work of private investigators and police trying to stop the problem. "That's re- placed what used to be easy-to- catch [suspects]. Now, they're moving targets." Lipkus, a lawyer who focuses on anti-counterfeiting with Kes- tenberg Siegal Lipkus LLP in Toronto, saw the trend at work when his firm recently helped police raid several suspected fraud operations at three flea markets across the Greater To- ronto Area. They included Pick- ering Markets, Downsview Park Merchant's Market, and Dr. Flea's Flea Market in Etobicoke. Using search warrants, they went in at 9 a.m. on a weekday in late No- vember — a time when the mar- kets are closed — to investigate 91 booths. The operation led to the seizure of more than $4-mil- lion worth of counterfeit goods, most of which was apparel and shoes copied from brands such as Nike, Adidas, Reebok, Timber- land, Louis Vuitton, Gucci, True Religion, and Rock & Republic. Investigators even found several fake game-worn jerseys purported to be from hockey star Sidney Crosby. "How many game-worn jerseys can you have?" Lipkus joked. Following the November raids, police claimed they repre- sented the largest operation on flea markets in Canadian his- tory. The case, Lipkus says, is a good example of the increasing role of private firms such as his in prosecuting the burgeoning global counterfeit trade. In that instance, his office represented more than 20 companies con- cerned about bogus products. As a result, investigators had al- ready been lurking around the flea markets for two months be- fore the raids gathering evidence needed to convince the justice system to issue search warrants. "We then provided those state- ments to police," says Lipkus. Also helpful was the fact that private investigators had already been issuing cease-and-desist or- ders against vendors throughout the year, Lipkus adds. About a dozen of his firm's staff, including www.lawtimesnews.com Anti-counterfeiting zeroes in on flea markets W BY GLENN KAUTH Law Times hen Lorne Lipkus first got into the anti- counterfeiting busi- order to make quick cellphone calls to vendors warning them that a police officer or private investigator is around. Still, he notes that technology was a big help in making such a large inves- tigation feasible. In particular, in- vestigators were able to take digi- tal images of the suspected fake products and send them using file transfer protocol sites to the companies that in turn could ver- ify which ones were bogus. "You can't start shipping the product [abroad]. You've got dozens and dozens of items," says Lipkus. Doing so made it easier to 'You would think that the stores are the bigger business. I would dispute that. The counterfeiters are going to the flea markets to do their wholesaling,' says Lorne Lipkus. law clerks and paralegals, were involved in the case. Throughout his work, Lip- kus saw evidence of increasing sophistication on the part of the counterfeit operations, includ- ing the use of so-called spotters who monitor the flea markets in analyze the goods, meaning the firm could "satisfy to the police quickly that it was counterfeit and why," Lipkus adds. Telltale signs included the poor quality of the product, he notes, "Certainly with the luxury brands, that's the easiest way to tell." Other indications of counterfeit were a lack of a security device, such as a holo- gram, or limited information on the tag about who made the product. In the flea market cases, the push to raid the booths came from a complaint police had re- ceived. "It's just [that] once in a while, we like to put our thumb down," says Durham Region po- lice Const. David Jaciuk. So far, investigators have yet to lay any charges but are continuing to probe the case. Jaciuk credits firms like Lip- kus' with being a big help in making such investigations hap- pen. "They help us co-ordinate between the brand owners and provide the expertise that's need- ed to identify the product that we're seizing," he says. "Where it's nice is that we have an agency, and they can act on [behalf of] a multitude of different intellec- tual property owners." Of course, Jaciuk acknowl- edges that the effect of such investigations is generally tem- porary. Lipkus, too, notes that with police having conducted a similar but smaller raid in Pick- ering the year before and given that customs authorities in Can- ada inspect just a small portion of shipments arriving here, the counterfeit trade will continue. Still, he believes the November operation did put a dent in it. "It clearly had a dramatic [impact] LT