CHINESE COUNTERFEITERS COST BUFFALO CAP MANUFACTURER AN ESTIMATED $300 MILLION EACH YEAR - SENATOR LAUNCHES THREE-PRONG PLAN TO KEEP FOREIGN THIEVES FROM STEALING NEW ERA'S REVENUE & JOBS
Plan Would Help Track & Identify Counterfeiters, Shut Down Fraudulent Websites & More - Over Five Million New Era Knock-Offs Seized Abroad in the Last Five Years; Company Able to Detect Less than Half
Schumer Pushes Vital Partnership Between New Era and Federal Trade & Enforcement Agencies to Put Chinese Counterfeiters Out of Business and Safeguard WNY Company
Schumer: Policy Hat-Trick for New Era Needed to Shut Down Chinese Cap Counterfeiters
On Friday, at New Era Cap Company in Buffalo, U.S. Senator Charles E. Schumer announced his three-pronged plan to combat the scourge of counterfeit hat producers in China and elsewhere overseas, where millions of fake caps and other articles of knock-off clothing threaten the Buffalo company. The counterfeiters prevent New Era from increasing its revenue and furthering its positive impact on Western New York. Schumer's plan connects federal enforcement agencies with New Era officials to better identify counterfeiters overseas and beefs-up federal support to immediately halt their illegal operations, including the shutdown of factories and websites selling counterfeit caps and apparel. The Schumer-New Era partnership can help foster growth of this 92-year-old Buffalo company, with 700 employees in Western New York and 1,000 worldwide.
"New Era needs a policy hat-trick to shut down the thousands of hat counterfeiters who go undetected in China and around the globe," said Schumer. "Each fake baseball cap that threatens New Era's 700 jobs in Western New York is a feather in the cap for overseas knock-off manufacturers - and they must be stopped immediately.
"I will relentlessly push my three-pronged plan to safeguard this Buffalo manufacturer that has created family-supporting jobs in the region for 92 years. I will connect New Era with both the U.S. Trade Representative and the Department of Homeland Security in order to identify and crackdown on counterfeit factories abroad and retailers at home. I'll also push to strengthen the 'Operation In Our Sites' program's coordination with New Era in order to freeze the thousands of counterfeit websites that fly in the face of hardworking Western New Yorkers who manufacture the highest quality hats around. The scourge of fake hats that gouge revenue from New Era has continued for far too long, and my plan will help put a lid on the problem once and for all."
"New Era's popularity and global presence has made it a key target for counterfeiting operations," said New Era CEO Christopher H. Koch. "We will not tolerate others making money through the sale of poor quality, imitated products being peddled as authentic New Era caps. We thank Senator Schumer for working towards protecting our consumers and our brand."
Schumer was joined by New Era CFO Ray Barry, New Era Senior Director for Legal and General Counsel Lorrie Turner, and other New Era executives as he launched his plan to crackdown on counterfeit caps and apparel abroad so that New Era can boost job-growth in Buffalo. New Era Cap Company, founded in 1920 in Buffalo, is headquartered on Delaware Avenue in Downtown Buffalo. New Era produces over 45 million caps per year, and operates a production facility in Derby, NY that employs over 450 Western New Yorkers. Producing their first baseball cap in 1934, New Era has been the exclusive supplier of caps to Major League Baseball and its minor league affiliates since 1993 and is the official on-field cap for the National Football League.
Schumer unveiled his plan, which includes utilizing the office of the Unites States Trade Representative (USTR) to provide resources and support to New Era Cap in an effort to train New Era in the best ways to track and shut down fake cap producers; urging the Department of Homeland Security (DHS) and the US Justice Department (DOJ) to communicate directly with New Era about any information concerning the location and tactics of counterfeiters; and directing the National Intellectual Property Rights Coordination Center (IPR Center), a multiagency task force devoted to investigating and eradicating global intellectual property theft, to strengthen the program known as "Operation In Our Sites" to identify and shut down the thousands of counterfeit websites each year who facilitate the theft of millions of dollars in New Era's annual revenue by increasing communication between the Center and impacted companies.
Schumer aims to foster the growth of a 92-year-old Buffalo company with 1,700 employees worldwide as he cracks down on fake cap producers abroad. Last year alone, New Era seized 850,000 fake caps worth over $35 million in 298 factories; found 120,000 fake pieces of apparel valued at more than $10 million in 48 factories; and removed over 90,000 counterfeit websites with a removal value of over $94 million. While New Era has gone to great lengths to keep foreign counterfeiters from stealing Western New York revenue, the company estimates it detects only 30 to 40 percent of the counterfeit market each year.
By creating a more open line of communication between New Era and top officials at various enforcement agencies, and by pressing those agencies to work hand-in-glove with New Era's brand protection team, Schumer aims to increase the percentage of counterfeiters that are caught and shut down. "Federal enforcement officials can help New Era slam the door on the millions of counterfeits still slipping through the cracks," said Schumer. By strengthening New Era and helping to protect its brand, not only will Western New York see an even stronger partner and job creation engine, but New Era will be able to continue the important work they do throughout the community, including programs like Shaping a New Era that help support the Ride for Roswell, the Jackie Robinson Foundation, and other important initiatives.
"Operation In Our Sites" - launched in 2010 by the IPR Center Department of Justice, U.S. Immigration and Customs Enforcement, and the Federal Bureau of Investigations - seeks to shut down "commercial websites engaged in the illegal sale and distribution of counterfeit goods and copyrighted works." As of July 2012, 769 domain names seized have been seized, 229 have now been forfeited to the U.S. government.
In December of 2010, Schumer helped Long Island-based D'Addario, the world's leading guitar string maker, to work with the Department of Homeland Security, Department of Justice, and the Office of the U.S. Trade Representative to launch a coordinated crackdown on the makers and distributors of counterfeit D'Addario products from China sold on websites such as Alibaba.com. At his urging, D'Addario has worked with various federal agencies to increase enforcement and to develop a coordinated crackdown on counterfeit guitar strings. In addition, Alibaba.com took down 421 ads for counterfeit strings. Schumer will fight for similar successes for New Era's new partnership with federal enforcement agencies.
With the success of their baseball caps, New Era has seen tremendous growth, leading it to open 14 large flagship stores globally, including one at their Buffalo headquarters. Since 2003, New Era has opened offices throughout the world, including Europe, Asia, and Australia. With this growth, the company chose to move their headquarters to the ex-Federal Reserve Bank building in Downtown Buffalo. The new headquarters is just one more example of New Era's commitment to Western New York's workforce. New Era continued that commitment when, in 2010, and at the urging of Senator Schumer, the company chose to keep its Derby facility open even in the face of recession citing workforce and cost-effectiveness of Western New York as their rationale. Since then, New Era has only continued to grow, hiring 100 new employees in 2011, and expanding its brand beyond headwear into cap accessories, wallets, bags, sunglasses and other items, and recently opening its newest Flagship Store in New Orleans.
A copy of Sen. Schumer's letters appears below:
Dear Ambassador Kirk,
High levels of counterfeiting in China continue to erode the competitiveness of U.S. manufacturers and their workers. Recent investigations undertaken by New York headwear and sporting apparel manufacturer New Era Cap Company - at its own expense - uncovered extensive counterfeiting operations, based in China, illegally producing and selling sub-grade counterfeit hats and other goods under the New Era label, to consumers around the globe. I write today to ask that you press China to shut down the manufacturer of counterfeit New Era goods and provide resources to train New Era in the best ways to track and shut down fake cap producers.
New Era Cap Company is a business based in Buffalo, New York. Founded 92 years ago, New Era has grown to largest and fastest growing headwear manufacturer in the United States and is the exclusive manufacturer and marketer of the official on-field cap worn by every Major League Baseball team and their minor league affiliates. New Era employs 1,700 people in worldwide, including 700 in Western New York. Counterfeiting is a major threat to the continued economic health of New Era and its workers.
In addition to uncovering extensive counterfeiting operations, New Era found that over a million counterfeit New Era caps will be seized worldwide this year - 98% of which originating in China. Counterfeit New Era caps manufactured in China are being sold in the United States and around the world, including through various unscrupulous websites.
Makers of the counterfeit hats also have developed sophisticated techniques to evade customs officials.
New Era estimates that counterfeits cost their company in the region of $300 million a year - not to mention the irreparable damage done to the New Era brand when consumers inadvertently buy an inferior counterfeit product. The Chinese fakes are eroding New Era brand equity, hurting New Era's bottom line, endangering its markets overseas, and undermining its ability to continue to grow its exports.
U.S. manufacturers like New Era cannot stop the manufacture of counterfeit products alone, particularly in a country like China with lax protection and enforcement of intellectual property rights. For this reason, I respectfully request that the Office of the United States Trade Representative review New Era's counterfeiting claims and work with Chinese officials to crackdown on companies manufacturing and selling counterfeit New Era products. Thank you for your time and consideration.
Dear Secretaries Napolitano and Holder,
High levels of counterfeiting in China continue to erode the competitiveness of U.S. manufacturers and their workers. Recent investigations undertaken by New York headwear and sporting apparel manufacturer New Era Cap Company - at its own expense - uncovered extensive counterfeiting operations, based in China, illegally producing and selling sub-grade counterfeit hats and other goods under the New Era label, to consumers around the globe. I write today to ask that you continue to enforce anti-counterfeiting measures and communicate directly with the New Era about any information concerning the location and tactics of counterfeiters.
New Era Cap Company is a business based in Buffalo, New York. Founded 92 years ago, New Era has grown to largest and fastest growing headwear manufacturer in the United States and is the exclusive manufacturer and marketer of the official on-field cap worn by every Major League Baseball team and their minor league affiliates. New Era employs 1,700 people worldwide, including 700 in Western New York. Counterfeiting is a major threat to the continued economic health of New Era and its workers.
In addition to uncovering extensive counterfeiting operations, New Era found that over a million counterfeit New Era caps will be seized worldwide this year - 98% of which originating in China. Counterfeit New Era caps manufactured in China are being sold in the United States and around the world, including through various unscrupulous websites such as Alibaba.com. Makers of the counterfeit hats also have developed sophisticated techniques to evade customs officials.
New Era estimates that counterfeits cost their company in the region of $300 million a year - not to mention the irreparable damage done to the New Era brand when consumers inadvertently buy an inferior counterfeit product. The Chinese fakes are eroding New Era brand equity, hurting New Era's bottom line, endangering its markets overseas, and undermining its ability to continue to grow its exports.
U.S. manufacturers like New Era cannot stop the manufacture of counterfeit products alone, particularly in a country like China with lax protection and enforcement of intellectual property rights. For this reason, I respectfully request that the Department of Homeland Security continue to focus on enforcing global intellectual property right infringement - such as the flea market raids you have been conducting. I also request that you share any information about counterfeited New Era products with the company in order to assist them in identifying and ending the counterfeiting of their goods. This process will help New Era and enforcement officials trace the source of the counterfeit merchandise back to its source. Thank you for your time and consideration.
Dear Director Kubiak,
High levels of counterfeiting in China continue to erode the competitiveness of U.S. manufacturers and their workers. Recent investigations undertaken by New York headwear and sporting apparel manufacturer New Era Cap Company - at its own expense - uncovered extensive counterfeiting operations, based in China, illegally producing and selling sub-grade counterfeit hats and other goods under the New Era label, to consumers around the globe. New Era has been particularly hurt by the proliferation of Chinese websites selling counterfeit goods not just in China, but all over the globe. I request that you expand the "Operation In Our Sites" program to identify and shut down the thousands of counterfeit websites that currently exist and communicate with the companies that are victims of intellectual property theft. By working with the interested parties, we will be able to identify these fraudulent websites quicker and more efficiently.
New Era Cap Company is a business based in Buffalo, New York. Founded 92 years ago, New Era has grown to largest and fastest growing headwear manufacturer in the United States and is the exclusive manufacturer and marketer of the official on-field cap worn by every Major League Baseball team and their minor league affiliates. New Era employs 1,700 people worldwide including 700 in Western New York. Counterfeiting is a major threat to the continued economic health of New Era and its workers.
In addition to uncovering extensive counterfeiting operations, New Era found that over a million counterfeit New Era caps will be seized worldwide this year - 98% of which originating in China. Counterfeit New Era caps manufactured in China are being sold in the United States and around the world, including through various unscrupulous websites such as Alibaba.com. Makers of the counterfeit hats also have developed sophisticated techniques to evade customs officials.
New Era estimates that counterfeits cost their company in the region of $300 million a year - not to mention the irreparable damage done to the New Era brand when consumers inadvertently buy an inferior counterfeit product. The Chinese fakes are eroding New Era brand equity, hurting New Era's bottom line, endangering its markets overseas, and undermining its ability to continue to grow its exports.
U.S. manufacturers like New Era cannot stop the manufacture of counterfeit products alone, particularly in a country like China with lax protection and enforcement of intellectual property rights. For this reason, I respectfully request that you meet with New Era officials and help work with their team to shut down websites selling counterfeit goods as quickly as possible. By working hand-in-glove with New Era officials and helping provide a renewed focus on New Era's particular set of challenges we can better protect this important company. I also request that the National Intellectual Property Rights Coordinator center continue to crack down on websites selling counterfeit goods and better communicate with interested parties to quicken the process of shutting down these websites.