- The Washington Times - Sunday, August 3, 2003

Women looking to buy a “knockoff” of a popular boxy designer purse downtown probably will walk away empty-shouldered now that Kate Spade is in town.

The day before Kate Spade opened its purse boutique in Georgetown, city and company officials met to try to shut down the illegal street-vendor sale of counterfeits of the trademark purses.

Officials from the U.S. Customs Service and the D.C. police department as well as other city officials sat down with Kate Spade representatives on June 9. Though they were the target of the crackdown, no vendors were made aware of the meeting.

“We look at it like stealing — the same way as someone coming into our Georgetown store and walking off with a purse,” said Barbara Kulson, general counsel and senior vice president of Kate Spade in New York. “It’s a crime and it’s unethical.”

The high-end purse company says it is losing about $70 million in sales a year to the imitations.

But, Ms. Kulson said recently, street vendors are still selling Kate Spade knockoffs, particularly at carts near Metro stops downtown.

“These vendors [sell knockoffs] all the time,” she said. “Ask the vendor if he’ll make it a Kate Spade bag,” she said, adding that she was able to purchase a fake Kate Spade recently.

At the June meeting, city police officials had said they would step up undercover patrols around the vendors.

Although company officials contend otherwise, the police officer in charge of the “sweepdown” said the vendors have been cooperative since the meeting.

“Since then we haven’t seen any counterfeit merchandise,” said D.C. police Lt. Joshua Eaves. He did not comment on the frequency or outcome of the undercover investigations.

The most imitated Kate Spade is the Sam bag. Easy to identify, the purse is square and has a small flap that snaps in the center. The real Sam costs $170; a counterfeit costs about $20.

“There’s a big problem in D.C. with counterfeit goods,” Ms. Kulson said. “These purses are most likely manufactured in China, but the labels are made in the U.S.”

“You can have great laws, but if the police aren’t enforcing them, the vendors have no reason to stop,” said Tim Trainer, president of the International AntiCounterfeiting Coalition, a D.C. group that combats piracy and counterfeiting.

According to Mr. Trainer, the only real enforcement is through private investigators hired by the companies affected, such as Kate Spade or Gucci.

“It’s pretty bad in D.C.,” he said.“Private investigators are used all the time. But normally with the civil seizure, you may take away counterfeiting goods for that day, but it’s not enough of a deterrent — they are back the next day.”

Jack Smalley, a private investigator, has been on the knockoff trail for 10 years. He said he thinks the vendors, especially in Georgetown, add to the shopping ambiance of that area.

“It’s been going on for a long time, but it’s not an astronomical problem,” he said.

He added, however, that it is a real headache for the company that is getting ripped off.

“It causes a great deal of harm to people who make them,” Mr. Smalley said. “When [a new model] hits the showroom, it’s already being counterfeited.”

The amount of counterfeit merchandise is increasing nationwide, according to Mr. Trainer, and designer bags are popular products. Customers typically know that purses and wallets bought on the street are fake but buy them anyway, whereas items such as auto parts and cigarettes are more difficult to figure out.

“When you walk by one of these carts, the plain bags look nice for $10, but by putting the name on the bag, they charge an extra $5 to $10,” Mr. Trainer said.

At the corner of Wisconsin Avenue and Prospect Street, a sea of purses waits to be sold.

“I don’t know exactly where they come from,” said Demba Kandji of Fashion Gallery, a narrow store on Wisconsin Avenue that bulges with purses.

“Other people get them; I just sell them,” he said.

He did not identify the “other people,” but said the purses, in his store as well as in the nearby cart, were “clean.”

He, however, did say that the wholesale price for the average purse is $18, and he typically sells each for $20.

“This purse costs about $4 to make,” said Lauren Johns, 20, a student who recently haggled for a purse that has a striking similarity to a Louis Vuitton handbag.

“Just because something is very expensive, doesn’t mean it costs much to make.”

She spent 20 minutes bargaining at the cart. The original price quoted was $60. Miss Johns brought the seller down to $40, but she wanted to buy it for $32. After the man refused to budge, she said: “I spent less time buying a car.”

The sight is familiar to anyone who walks downtown or shops in Georgetown: carts overflowing with purses and wallets that could be Fendi, Gucci or Louis Vuitton. Women sifting through a cornucopia of colorful bags, trying to haggle with the vendor over a few dollars. Many students flock to the purse stands to find an imitation of what they see in department stores.

Mr. Kandji is from Senegal. His employees are friends and family from back home. The store opened some months ago, and it sits among its high-end neighbors — Nine West, Diesel and Kenneth Cole — holding its own.

Mr. Trainer, who recently testified on counterfeiting before the House International Relations Committee, said there is little incentive for the vendors to stop selling the counterfeits.

“The easiest way for a vendor to profit is to take someone else’s name,” he said. “People want to have things that are recognizable, and these guys are making money off of that.”

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