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Lawyers for two famous clothing brands never thought that a few suspicious shirts would lead them to a legitimate-looking Manhattan apparel company with a professional showroom. But that’s just what attorneys for VF Corporation (which makes The North Face line of outdoor gear) and Polo Ralph Lauren Corporation found when they raided TC Fashions, Inc., last fall. Though TC denies that it was selling counterfeit items, a federal judge has already entered a preliminary injunction against the company. PRL and VF now expect the injunction to be made permanent as the result of a tentative settlement reached with TC in May. G. Roxanne Elings, a Greenberg Traurig partner who serves as outside counsel to PRL and VF, led the raid on TC’s Manhattan offices. “This is one of the largest operations I’ve seen in my 15 years [working on counterfeiting],” says Elings, who has been on more than 100 raids and represents about a dozen apparel companies. Barbara Kaplan, senior counsel and head of the anticounterfeiting program at VF, did not go on the raid but received reports from Elings. “It was one of the most sophisticated networks I’ve ever [heard of],” Kaplan says. “It was not a hole-in-the-wall in the garment district. They had a showroom … [and they] kept very specific financial records. … I’ve never run across anyone so organized before.” TC’s attorney, Dwight Yellen of Ballon Stoll Bader & Nadler in Manhattan, has appeared in court twice for his client, but did not return calls seeking comment for this story. In its response to PRL and VF’s complaint, TC denied all allegations of counterfeiting. However, last November a federal judge issued a preliminary injunction that bars TC from manufacturing or selling fake goods bearing Polo Ralph Lauren or The North Face trademarks. Elings says that the injunction will become permanent under a settlement her clients struck with TC in May. The deal had yet to be finalized at press time. But Elings says that under the terms of the agreement, TC will also have to cough up the profits it made on sales of counterfeit Polo Ralph Lauren and North Face goods, which she estimates to be in the six figures. According to Customs and Border Protection, around $16 million in wearable apparel is seized domestically each year. The federal agency adds that knockoff clothing accounts for about 17 percent of domestic counterfeit goods � more than any other commodity. “We find [that] counterfeiting is not a little splattering like before,” says Sherry Jetter, vice president of IP and legal affairs for PRL. “They’re bigger cases, like [TC], that really make an impact.” (Jetter is a member of Corporate Counsel’s advisory board.) Elings and her clients rely on private investigators to scour trade shows, online sellers, and street vendors in a never-ending search for knockoff goods. Last year, investigators discovered Polo Ralph Lauren and North Face goods at TC. In affidavits filed by PRL and VF, counterfeiting experts at both companies detailed the ways in which they determined that the items from TC were fakes. On the basis of these statements and affidavits from the private investigators, PRL and VF were able to convince U.S. district court judge Richard Berman to grant a temporary restraining order that authorized a search of TC’s operations. On October 27, 2005, with no warning to TC employees, Elings � along with another Greenberg lawyer, two New York police officers, and about a half-dozen investigators � raided the business. “I wouldn’t say I look forward to the raids,” says Elings. But she says that it’s “the ideal time to gather crucial and time-sensitive information.” It took her team two days to sift through records, copy hard drives, and gather documents. In addition to apparently fake Polo Ralph Lauren and North Face items, Elings found what she says was suspicious apparel for more than 30 other brands. While PRL and VF may have thwarted TC, they will undoubtedly have to contend with other counterfeiting threats in the future. “We’ll always have some issues with counterfeiting so long as we’re a famous brand,” says PRL’s Jetter. But, she adds, “when counterfeiters see you put money and resources behind [trademark protection], they’ll go to other brands that aren’t so vigilant.”

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