Closer Look

Spot the difference? How fake merch inflicts very real harms

Village Media Inc.

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This week, Toronto police displayed the fruits of a massive seizure of counterfeit soccer merchandise worth millions of dollars.

The haul included 16,000 fake name-brand jerseys and flags — including FIFA, Nike, Adidas and Puma — and even two counterfeit FIFA World Cup trophies.

At first glance, it’s easy to downplay such a bust as a “victimless crime.” But don’t tell that to Toronto lawyer David Lipkus, whose firm, Lipkus Law LLP, tipped off the cops to this operation.

A leading intellectual property lawyer who helps major brands protect their trademarks, Lipkus has seen first-hand how counterfeit items harm the economy, threaten consumer safety and line the pockets of organized crime.

Lipkus is our guest on this week’s episode of Village Media’s Closer Look podcast.



Reach out to Frisco and Scott

SPEAKER_02

I've had, believe it or not, counterfeit jerseys with urine and facies traces on them. So you tell me who wants to put that on their body.

SPEAKER_04

Let's just go back uh seven days to last week. Uh the episode that we did with uh our friend Tudor Gadge on uh the auto insurance policy changes uh did very well.

SPEAKER_03

Yeah, a lot of people were I think a lot of people wanted to learn about what the changes are gonna be. Absolutely. And I don't want to at all say that everybody followed us, but I did notice a huge bump in other stories about this coming into effect right after our podcast. So we were ahead of the curve on that. Trendsetters. July 1st was the day it all takes effect. So people people are asking these questions. And and uh like we said on the show, it's the younger drivers that are coming up, right? That are, you know, we've always been schooled on like you have to have all this insurance or you can't get behind the wheel. So you just paid for it. Because when you're you're a young driver getting your license, you're like, yep, I want to get on the wheel, right? Yeah. Now you're gonna give that choice to you know 17-year-old, 18-year-olds, and they're gonna say, Oh, that's gonna be twenty dollars cheaper a month, yeah, I'll get that. And it's I'm just waiting. This is terrible to say, but the inevitable horse story will will come out, right? That I didn't get the insurance that I should have, and look what happened. Yeah, right. Because it saved me 50 bucks a month. Yeah, it saved me 50 bucks a month or whatever it's gonna be. Um so if you have stories to share, if you're if you have your uh your policies in hand and you're looking at the difference, we'd like to hear them. I'd like to know what like is it eight bucks a month difference? What's the price?

SPEAKER_04

Aaron Powell Well, I'll tell you this much. Uh we just uh renewed uh a couple of weeks ago and had uh lengthy conversations uh with our broker, uh, who is tremendous, uh by the way, um, just to make sure that we had a clear and full understanding of what these changes uh meant before we uh signed up. Did you know that they showed you a different price if you didn't get those things? Aaron Powell No, I just wanted to make sure that if we did nothing, everything will remain status quo unless we decided that we wanted to not have this, this, and this. Um and and it was explained uh quite uh thoroughly and crystal clear so that we felt good uh going to the street.

SPEAKER_03

Also, because you're such a dangerous driver. I see you whipping around like you got the heavy foot. So that's you know what?

SPEAKER_04

I've been driving home. That's right. Thanks for that. There go my rates next year. I have only had in uh I don't know how long I've been driving a long time. One speeding ticket. Really? One where on the highway or in the town? Uh it was on the highway, uh, just outside of North Bay. Yours I was I was 16, actually.

SPEAKER_03

Oh, right when you got fresh out of uh see what I'm talking about? Yep. And if you were a modern day 16-year-old, you wouldn't have the right insurance, and who knows what could happen. Yeah, see? So there you go. Anyway, speaking of costs, yes, sports jerseys. Uh the World Cup just around the corner, and uh here they come. The scammers are back at it. Yeah, the major bust in Toronto this week, I think it was three and a half million dollars worth of counterfeit jerseys, even two fake World Cup trophies is just the best part of the picture. They made these solid gold World Cup trophies, right? For only $29.99. Yeah, and the tip came into the police uh and uh they busted up a warehouse, I think in Mississauga it was, just full of not a warehouse, like a big storage block, just full of boxes of counterfeit jerseys. And it's shocking when you see the images of like, wow, because they looked so real, right? And it just shows how much how far counterfeiters have come in the last few years just making this stuff look so legit. Um and you know, it it these cases always raise a lot of questions because you also you always hear from the people who say, who cares? Like, so yeah, I'm gonna buy a cheap $30 version of a jersey that might cost me $250. Too bad for them. They shouldn't be so much, so I don't care. But there's actually a lot of in uh uh we know a lot about where this money goes, the organized crime groups that profit from this kind of thing. And so we're gonna have a great guest on today. David Lipkiss is uh one of the best uh intellectual property lawyers in the country, he knows it inside and out. His father's uh I want to say legendary because he is, he's a legendary intellectual property lawyer. And uh both of them are they're they were they have lots of different clients and they represent lots of different companies, and they're always on the lookout for these, and these companies get tips. They're they have investigators online looking at what's happening, right? So they're they're doing active work to try to find out where counterfeiters are exploiting their brands. And so they'll often do raids, the they'll often tip off police and they'll end up laying charges. Um David and his father, their law firm, has also run this conference every year for like 29 years. Right. And uh and I went to it when I was a young reporter at the Post, and we did a big series on counterfeit goods, and it was fascinating because they bring together all the people in this world, right? Like companies, law enforcement, uh experts, uh, intellectual property lawyers, to sort of learn about why this is a problem. And they've actually done a they're actually a big reason why a lot of law enforcement agencies are as up to speed as they are on this issue. But bottom line is these guys are on the ground too, because they're participating in some of these raids, they're filing all kinds of lawsuits against these scammers. Um so, David, uh, we thought it would be a great conversation just about why this is not just you saving a few bucks on a cheaper jersey, why there's a whole lot more to this story.

SPEAKER_04

With the FIFA World Cup just around the corner, Toronto police have announced the largest counterfeit soccer merchandise seizure in Canadian history. More than $3.5 million worth of fake jerseys, flags, and sporting goods. What does a case like this tell us about the counterfeit market and how can fans avoid getting ripped off? Joining us is David Lipkiss, co-founder of Lipkiss Law, and one of the country's foremost intellectual property lawyers, his firm, helped bring this case to the attention of Toronto police. David, thanks for being here. We appreciate your time.

SPEAKER_02

Scott, Michael, thank you so much for having me. I'm looking forward to discussing everything.

SPEAKER_04

All right, David. Now, without getting into uh the specifics uh of this investigation, how significant is a seizure of this size in the world of counterfeit merchandise?

SPEAKER_02

It's significant. And I'm gonna tell you that this is a snapshot in time of what counterfeits were available in this case at one distributor in one city in Ontario. The reality is this intellectual property crime, which is counterfeit goods, is available in the marketplace everywhere, in every major city in Canada, online, on social media, on third-party marketplaces. The problem is massive. From a purely statistical perspective, I can tell you that the only study I'm aware of is through the OECD, which is the Organization of Economic and Cooperative Development. And it was a global study and to the tune of hundreds of billions of dollars yearly as it relates to the sale of counterfeit goods. So that doesn't speak to Canada specifically. And there's no study that, to my knowledge, that exists as it relates to what is the problem in Canada, but it's to the tune of hundreds of millions or billions of dollars on a yearly basis. And that's why this seizure is so significant, because again, it's one distributor in one city in our country. So imagine how big it is as a result of just looking at this specific uh seizure.

SPEAKER_03

It's fascinating. I know it's an active investigation, so you can't get into too many details. Do you're not able to share, for example, how you've found out about these guys or how that kind of came about?

SPEAKER_02

So I can share. So the Toronto, someone asked me um during the press conference yesterday, you know, who we acted for. I can share with you I acted for every single brand that participated in the seizure. So there you have it, the cat's out of the bag now, because that's the first time I've repeated that publicly. But, you know, there the the truth of it is that information and that investigation is confidential to that respective client. Meaning it's not my place to say, here's how this came to the attention of the brands, but it did, and it resulted in that, you know, 17,000 plus items. It was the majority were jerseys and flags. And you saw all the products if you watched the press release. And so it really was eye-opening because this was the largest seizure of counterfeit jerk soccer jerseys in Canadian history. That's significant.

SPEAKER_04

David, why do major sporting events uh like the World Cup become such attractive targets for counterfeiters?

SPEAKER_02

So, two reasons. Number one, fan excitement, right? You're it doesn't matter where you're from or what country you call home, but that you have a place in this tournament where you want to support someone, whether, and I'm hoping it's a Canadian jersey, you know, being born and raised in in Canada, and that's what you know, who I'll be supporting, but everybody has someone to support. So issue number one is fan excitement, and people buy gifts for their children or buy gifts for their family. And so they want that gift to be relevant at this point in time, which is the 2026 World Cup happening in our backyard. That's significant. Second of all, the real issue is the cost. There are varying costs associated with buying these jerseys, and then there are lower costs associated either with counterfeit or what I'll call low-cost alternatives. So go no further than Costco, and you'll see that you can buy in Italy or Argentina a Spanish jersey for $35.99 or $34.99. So it's not fair to say that there are not legitimate jerseys available that are not counterfeit available to the public.

SPEAKER_04

David, when most people think of counterfeit goods, they may picture a fake watch sold on a city street corner somewhere. How sophisticated have these operations become over time?

SPEAKER_02

Well, I will tell you two things. Number one, anything and everything can be counterfeited. So from the watch to the jersey to contact lenses to shampoo to sunglasses, everything and anything is being counterfeited. So you you name it if you're a brand and there's a margin of profit available for a manufacturer overseas, there's a counterfeit version available to that brand. That's that's the baseline. I want everyone's baseline understanding to be there. The problem is so how big has it become? It's massive. Uh every day I work on dozens and dozens of counterfeit files for many different brands, over 200 different brands. And the reality is nobody that's listening should want to support this activity. I'm going to explain why. That $20 watch, those funds are going to organized crime, to supporting terrorism, to child enforced labor. And I think we can all agree that nobody wants their money going there. So that's number one. This is this is bad activity. The police have proved it. You can Google this, go look at the Charlie Ebdo terrorist activity that was funded. That terrorism was funded through the sale of counterfeit goods. Look no further than cases in Canada where there are, in addition to counterfeit goods, there's drugs and guns on site in these warehouses. So that those cases have taken place in our backyard. Nothing we want to support. Then you look at the other side. What about all the taxpayer dollars? We pay a very high tax rate in Ontario, in Canada. Do you think that counterfeit sellers generally contribute to our economy in that way? Or do you think it's more of a cash style business and those funds are not going to where they should be? Because I can tell you for every one of my brands, they are contributing to our society and paying taxes and employing people. How many friends have we had that have lost jobs because the, you know, that store wasn't doing well and that brand ended up not being as popular? And the direct result is because of the sale of counterfeit goods. That's what I'm living. And so the reason I'm glad that you reached out to me and had me on this on this talk is because people need to hear that. And it's tough to hear, but that's the reality. This is a really bad source, a bad source of contributing to society. And so I'm hoping that people listening will think twice before they say it's a victimless crime because it's not.

SPEAKER_03

It's a great point. That's the question I was going to ask next was the victimless crime. You must just hate that term.

SPEAKER_02

Well, it's funny. My first week on the job, or even when I started in this area, I had a friend that came to me and that bragged about all the counterfeit goods, all the counterfeit bags they had. And my response obviously was making fun of them and telling them they overpaid and they could have got them cheaper. But the reality is they didn't have any understanding of why they're a victim and why they should care. And I do as much as I can to educate the public, including some of my naive friends, to say, do you want your money going to a bad place? And if the answer to that's yes and you don't care, fine. You right now the media has a whole bunch of written articles written about the seizure. And I've read a lot of those comments, and believe me, I wish I could respond. I can't and I won't. But the truth of it is the no one's asking people to go buy a $300 plus jersey. Number one, they don't cost that much. Number two, there are low-cost alternatives. Number three, the victims could be them themselves by paying higher tax dollars or by having a friend lose a job.

SPEAKER_03

That those are real things that are happening in our country. It's interesting, right? Because even despite all the things you've said, which are accurate, you still might have listeners who say, well, you know what, I still don't care because that's just some big company making 200 bucks a pop on a jersey. What do you say to those people?

SPEAKER_02

I say don't look at it from the scope of the brand. Number one, go to Walmart, go to Costco, go online to a legitimate vendor and buy the $34.99 legitimate jersey that exists. Those were created for you because you chose that you don't want to spend what others are prepared to spend for, by way of example, the on-field jersey that the players are going to be wearing. Those are obviously a higher quality jersey, and there's costs associated with that. So, number one, I would say shop smartly, where buy a legitimate jersey for the team you want to support, either a low cost or save your money and spend on one that's a little bit more expensive. Again, somewhere legitimate, sport check, or uh there's so many better gift shop, like I'm talking about local Toronto places, better gift shop and Momentum Clothing Out West and Nomad and Capsule, and there's all these local businesses that you can support that are selling legitimate goods. The next thing I would say is be careful how you shop. You're the same person, potentially, that's going online, having your credit card credentials stolen because the the website that you're shopping on is just stealing your identity, right? They're using your name, they're using your address, they now know what your credit card number is, and they're just selling those details through the dark web. So you are causing harm to yourself by supporting this illicit activity. You're not dealing with nice people. So those things can happen. And then I would say if you want to keep paying 53%, maybe 55%, at some point we're gonna have a 60% tax rate. Okay, then you know, thank you very much for you being the reason that we are all suffering.

SPEAKER_04

David, are uh are counterfeiters getting better faster than the brands are getting better at stopping them? And has e-commerce made this problem exponentially harder to police than it was, say, 20 years ago?

SPEAKER_02

I love that you asked that question. I will say in the last two years, one of the things that I've noticed is that the there is a what I'll call quality increase to the counterfeits, meaning it is harder for consumers to be able to tell by looking at photos whether that jersey or whether that counterfeit item is real or not. That's that is a live issue right now. The quality is not the same. It's just that the photos that you're seeing or your initial reaction leads you to believe that you're buying something legitimate. That's a problem. And that's a problem that exists today. It doesn't mean brands aren't catching up. It just means that the there is that slight ability for better version quality counterfeits to exist. That's factual. I acknowledge that. I think it is a problem, and it is something that brands have to be aware of. On the other side, though, you mentioned e-commerce, and it's a volume-based issue. So if you look at the problem that we had 10 plus years ago, it's completely different than it is now. I have some clients that have publicly stated they submit over a million listings yearly for removal on marketplace and social media. Wow. Just put right put that in brand. That's one brand. That's crazy. One brand for one item. And that's the numbers that we're talking about. So what e-commerce did, and certainly, you know, it was catapulted because of COVID, is it made everyone feel comfortable shopping online. And that's great if you're looking for something legitimate. It's horrible because what the counterfeiters are do is they come out in droves. So there's another phrase. The first one I hate's victimless crime. The second phrase is I hate whack-a-mole. You hear that all the time, and that brands are just they submit two, three listings and 10, 20 more pop up. And again, that is a problem that brands are dealing with today. But rest assured, at least for all of my clients, there are employees in-house. There's technology, external technology vendors that are working their hardest to remove as much of the garbage as possible from marketplaces and social media so that you have the ability to look at you as a customer, have the ability to find the legitimate goods.

SPEAKER_04

So, David, let's uh explore that a little bit more. As consumers, what is the easiest way for us to tell if the item is in fact legit?

SPEAKER_02

Okay, so this is a great question. So the first I call the smell test, right? The first thing that I do is when I'm shopping online is I look to say who am I buying from. So if you're on a third-party marketplace exam, as an example, you can actually determine who the specific seller is. And you can do searching, what's their address, what's the price that they're selling the product, what are the reviews like for that item. So you can do some diligence on a marketplace to make sure that you're buying what is hopefully from an authorized supplier. And again, price factors into that. Then you're gonna go to the brand's website. You can see and you can actually check if that vendor is authorized or not. So let's say you choose not to go to someone that's on the brand's list and you find what you believe to be a good deal. Here comes the hard part. This is where you have to do the appropriate diligence to say, is this a counterfeit or is this a legitimate? And the easiest way to do that is to look to see what items are being offered, what cost is there associated with it, what information are they asking for me? The online world is a complicated place, but you can see how long has that website been up and running, what are there, you know, do they have reviews available? Counterfeiters don't want you to find them, they don't want you to know who they are, they don't want you to ever hear from you, period. And so that's a some way the way that you can do it. There are sites available where you can search in, for example, a URL to say, is it a scam site? Did someone get scanned? Did someone buy counterfeit? So that diligence in the online space needs to be done. I will say that it is hard. You know, ads come up on social media and it just the deal looks great. And so you just click and you make a mistake and you end up supporting counterfeit. So be careful because if the people say deal's too good to be true, it's an issue. I say if it's a bargain basement price, that's a red flag. That's not a discount. That that should tell you something's wrong here. And I used to do a little bit more diligence, a little bit more review to determine if the item's real. So that's on the sort of online world how to deal with it. Then you have the offline space where you're going to your nearest local store. And how do you know? Talk to them. Ask the vendor, is this real? What's the warranty that's associated with it? Look at the tags. A lot of the times at the counterfeits, there's just so many mistakes available to the to the to the eye. There's there should be serial numbers on there, there should be holograms, there, there are tools available to the public to feel confident in what they're buying. But again, if you go to a store and you're not confident in what you're buying is real or you don't like the return policy, final sale because they, you know, it's not legitimate and they don't want to hear from you, that's a red flag. And so just be mindful of that fact when you're doing that shopping.

SPEAKER_03

So though those are my sort of quick tips for you guys. It's fascinating. I'm sure a lot of our listeners have learned a lot today, though, which is always the goal of the show. So thank you for that, David. Real quickly, I I assume I don't want to say nervous is the right word, but are some of your clients a little bit nervous? Because once the World Cup is underway, I assume we on street corners we'll see guys popping up selling all this garbage.

SPEAKER_02

Well, hopefully you'll see me and the police officers right behind them because the plan is to ensure that none of these street vendors are out in the marketplace. And and I I a personal goal of mine is to ensure that people can buy legitimate goods from legitimate places during the World Cup because we expect a lot of fans to be on the streets and we are hoping that the counterfeit sellers don't make the mistake of risking being being there and having their merchandise either seized by the police or um, you know, subject to a letter requesting they voluntarily surrender those items.

SPEAKER_03

All right, last question for me. Can you just real quickly share with us the craziest story you have? What's the craziest counterfeit item that you or your clients have come across?

SPEAKER_02

So, craziest counterfeit, I would say, would have to be the contact lenses that had to be peeled off people's eyes. So that's a crazy one. I read reports, we represented a company that manufactured shampoo, and I had during the lawsuit had to read all the customer complaints of people who had burned scallops and just the pictures were nasty and just, you know, really eye-opening. I have seen images of manufacturers overseas of children being chained to vats of chemicals. And those are real life examples. And so the reality is this is not something that people should want to even associate themselves with. I've had, believe it or not, counterfeit jerseys with urine and facies traces on them. So you tell me who wants to put that on their body. So those are real factual cases that I have been involved with. Personally, from a personal level, I have been involved in raids where I was politely asked by the police officer to step outside because what turned from a counterfeit goods investigation turned into an active drunk drug and guns investigation. And so those those those are the days where you you don't feel like you're you're so safe in this job. But the reality is the um the police do a great job at at protecting us as Canadian citizens. Amazing. Uh and as do you, David. Uh anything else before we let you go tonight? Uh nothing else for me. I hope everyone has an amazing time watching the World Cup games and hopefully going if they were able to secure tickets. I will be watching on TV with everyone else. And I'm really excited. Um, if you listen, thanks for staying this far. And please don't support um counterfeit activity, don't support organized crime. If see something, say something, you can call Crime Stoppers. If you bought counterfeit and you don't and you didn't realize, call the Canadian Anti-Fraud Center to get your money back. This is not something that you guys want to be involved with. So um shop smart, everyone, stay safe, and thanks so much for your time, Michael and Scott. Really appreciated this conversation.

SPEAKER_04

Very well said. From Lipkiss Law, there's uh David Lipkis uh from Toronto. David, uh appreciate your time. Good to see you. Thank you. You too. Well, nothing uh screams go team go like a feces and urine-soaked fake jersey.

SPEAKER_03

I was gonna make a joke about the Italian team, which I'm allowed to make. That's right, you can. I couldn't, but you can. It's my heritage and it's uh they stunk it up this year, so I can see why their jerseys may have some uh feces on them. Some stains? It was pretty bad. But you know what, that that whole thing was uh such an eye-opening conversation. Yeah. I don't like the idea of putting a I've never put a contact lens in, and I don't think I ever could. No. The idea that I had to be scraped off my eye because it was counterfeit. Nope. It's pretty great. And then uh the shampoo too.

SPEAKER_04

It's just it's just wild. The lengths that people will go to to make money illegally as opposed to, I don't know, getting a legitimate job. Yeah, yeah. It's crazy to me.

SPEAKER_03

Trevor Burrus, Jr. And he's right though, that the you know the prevailing uh thoughts from a lot of people is eh, who cares? So I'm ripping off uh rollers, I'm ripping off, you know, uh Adidas who's selling me $200 jerseys. Who cares, right? But there is a lot of be behind the scenes, and uh I think uh as open as David was, I bet you he has some wild stories about some of the raids he's done and some of the investigations they've done and some of the clients they've represented, right? Yeah. Um I didn't ask him about I meant to ask him what the the you know because uh the the the the other prevailing thought is that most of these guys are gonna get a slap on the wrist, go to jail for five minutes, and it's gonna be over. So what I meant to ask that question about what the punishments typically are. Uh but we'll be watching this one uh closely in Toronto because it was such a big bust. All right. Who's your pick for the World Cup? Uh I'm not sure. But we should make one, eh? We should uh June twelfth is starting.

SPEAKER_04

I think France is gonna win. All right. What do you think? I have no pick. I am not a soccer. I couldn't tell you who's playing. No. I'm gonna say Canada. How about that?

SPEAKER_03

That'll work out great. Yeah. I think I'm not a huge soccer fan, but I am when it's like like we we watched that the Champions League game on the weekend. I think it was pretty exciting. And the World Cup's amazing. The the talent level on these guys is phenomenal. Like if you watch, if you go back and watch like Messi clips of his greatest goals, they defy a lot, like they defy like it's crazy what he does. And so I do like it for that. And you know, the the whole country thing, but it is just like the Italian team hasn't been in the World Cup in three three tries now, right? They keep missing, they keep missing, so it's a it's kind of a bit of a bummer. And it would have been nuts because I think tr Canada's playing Boz Bosnia and Herzegovina, uh, which is gonna be great, but you know, and there's there's some of that uh community in Toronto, but uh you know, italy if they were playing Italy in Canada in Toronto, imagine what the parties on St. Clair and Collis Street would have been like. It's uh now they're gonna be uh I think I think speaking of jerseys, I think a Jersey company went to Little Italy after they were eliminated and started giving out Canada jerseys. I saw that in the news.

SPEAKER_04

Was never a sport that I could get into.

SPEAKER_03

No. Oh, that running, eh? Running up running up and down the field.

SPEAKER_04

Not a fan of that. Um I I find it boring. Yeah. And I know that is highly ironic coming from a guy who loves golf.

SPEAKER_03

Yeah, watches golf on TV. I know. Yeah. But people say that about baseball. It's i if you appreciate the beauty of the game and what's actually happening. Yes. Uh and the the fact those guys do run up and down that field also. That is crazy. The athleticism. But it's the passing, it's like that to score a goal at the highest level, it just has to be perfect. Like the the So I I do like it for that. So there's always some good highlight uh reels. Uh the party in Toronto is gonna be insane if you booked your Airbnb.

SPEAKER_04

Uh no, but I can tell you uh because uh we looked, hotel prices unbelievable in Toronto. Yeah. Like I'm talking over a thousand bucks a night, unbelievable.

SPEAKER_03

It's nuts. Crazy.

SPEAKER_04

Anyways, go Canada. Go Canada go. Uh all right, that's uh it for us uh for this week. Closerlook at villagemedia.ca. Who are you cheering for in the World Cup? Let us know. We'd love to hear from you. Closerlookpodcast.ca. You can find uh all back episodes uh of the program. We'd love you to uh check that out and sign up to have it uh sent directly uh to your inbox. Uh we'll be back next Sunday for Zach Trunzo, executive producer of Closer Look and Michael Friscolandi, our editor in chief here at Village Media. I'm Scott Sexmith. Enjoy what's left of your weekend. See you next Sunday morning at eight, right here on Closer Look.

SPEAKER_00

Briscoe and Scott's wardrobe, provided in part by Morris Clothing for Menus.

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