Publishers help bust Chinese counterfeiters: investigation leads to seizure of 166,000 fake prints at two Chinese warehouses

Art Business News, Dec, 2003 by Elisabeth Butler

An investigation led by a group of fed-up art publishers has resulted in a groundbreaking lash against counterfeiting in China.

Led by Canadian Art Prints of Vancouver, British Columbia, eight publishing houses traced counterfeit art back to a massive printing operation in China.

On July 9, the Guangzhou Copyright Bureau searched two warehouses and a retail shop in Guangzhou, Tianhe, to seize more than 166,000 fake prints and 176 print films used to make counterfeit posters. Officials destroyed the imitations in front of newspaper reporters and TV news cameras.

The Art Copyright Coalition, a nonprofit organization in Washington, D.C., and Canadian Art Prints worked with Chinese officials to bust the counterfeit operations.

It's the first strike of its kind in China, and industry officials hope the event will stall the increasing volume of counterfeit art that Chinese companies have been producing.

Attorney Joshua Kaufman of Venable LLP in Washington, D.C., directs his firm's copyright, unfair trade and entertainment practice and helped start the Art Copyright Coalition. He said the group chases counterfeiters all the time, but the raid in China broke new ground.

"This is a breakthrough, to get the Chinese to be this involved and cooperative" Kaufman said.

Artists and publishers complained for years that the counterfeit operations in China were growing, but the Chinese government didn't do much about the claims until this year.

The U.S. Department of Commerce publishes a practical guide for American companies operating in China. In that guide, the department said China strengthened its intellectual property rights since joining the World Trade Organization, but it warns company leaders not to be lulled.

"Despite stronger statutory protection, China continues to be a haven for counterfeiters and pirates," according to the guide.

Lisa Krieger, president of Canadian Art Prints, said the summertime raids were possible because China has become more responsive to foreign complaints of counterfeiting. The raids also raised awareness that counterfeiting is a crime in China.

"I don't think people even realize, usually" Krieger said. "I don't think the population even understood what the copy-rights meant."

The clues to counterfeited art are often small, and customers likely didn't know they weren't buying prints of the original art, Krieger said.

Trade groups, publishers and artists often look for signs of counterfeit work such as images cropped differently than the original works, posters printed in sizes unlike the publisher editions, poor print quality and extremely low prices.

The Art Copyright Coalition started in 2002 when a group of art publishers joined forces to fight copyright infringement. Nearly 40 coalition members, including most of the top publishing houses, look for counterfeit art at trade shows, catalogs, auctions, storefronts and online.

"Nobody's a competitor when it comes to copyright infringement" Kaufman said. During its first year, the coalition recovered more than $100,000 for its members, he said.

When a group of publishers are able to trace counterfeit art back to the same source, the Art Copyright Coalition coordinates their complaints and helps them decide what they can do. Their options range from sending cease-and-desist orders to suing the counterfeiters.

The publishers work together and form a joint enforcement team to pay for private investigators and lawyers. In the case of the Chinese print operation, the group included Canadian Art Prints; Coquitlam, British Columbia-based Art In Motion; Walnut Creek, Calif.-based Bentley Publishing Group; Emeryville, Calif.-based Editions Limited Galleries Inc.; London-based Rosenstiel's; Woodstock, Vt.-based Wild Apple Graphics and Seattle-based Winn Devon Art Group.

Krieger said the group spent about $100,000 investigating the counterfeiters. She said that's a reasonable price to pay, when its split between several publishers.

Krieger said she knew the counterfeiting operations in China were growing, but she didn't know how much volume they were generating until she took a trip to Beijing.

"It was shocking. Everything was counterfeit," Krieger said. In a mall she visited, she found hundreds of counterfeit works. An original work that Canadian Art Prints would sell for $10 sold for $1 in the mall Krieger visited.

The raid was an answer to nearly two years of increased counterfeiting in China, where the distributors sent fake fine-art reproductions to storefronts in Hong Kong, Taiwan and China. Some of the prints also showed up in the Australian market.

Like most other publishing houses, Canadian Art Prints buys the rights to publish and distribute individual artists' works exclusively. Krieger said the raid's success might encourage more action in China. "We just need to keep our eyes and ears open and see what the effect of the raid has been," Krieger said.