WEBVTT - Why Marilyn Monroe Is a Counterfeiter's Best Friend

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<v Speaker 1>This is Bloomberg Law with June Brusso from Bloomberg Radio.

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<v Speaker 1>Her kiss the hand baby quite continental, but a kiss

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<v Speaker 1>maybe Graham. Marilyn Monroe an icon of pop culture. The actress,

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<v Speaker 1>known for her blonde hair and curvy figure, was one

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<v Speaker 1>of the most popular sex symbols of the fifties and sixties.

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<v Speaker 1>She died at the height of her career at the

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<v Speaker 1>age of thirty six. Monroe has inspired generations of entertainers,

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<v Speaker 1>and she remains popular nearly sixty years after her death.

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<v Speaker 1>There are the posters, mugs, T shirts, jewelry, and other

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<v Speaker 1>products that attest to the power of her brand. And

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<v Speaker 1>there are the fakes as well. Dozens of virtual storefront

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<v Speaker 1>cell counterfeit Monroe Goods and Authentic Brand's group uses an

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<v Speaker 1>allowed at and often covert operation to identify the counterfeitters,

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<v Speaker 1>even filing lawsuits under seal in a cat and mouse game.

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<v Speaker 1>Joining me is Susan Decker, Bloomberg patent reporter. So sue,

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<v Speaker 1>just how popular is Marilyn Monroe. She's so popular that

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<v Speaker 1>counterfeiters loved to put her name on T shirts, and

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<v Speaker 1>the owner of her trademarks loves to file suit to

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<v Speaker 1>stop them. So who owns the right to her picture?

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<v Speaker 1>Who owns the right to her name? Well, Authentic Brands Group,

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<v Speaker 1>which is possibly going for an IPO later this year,

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<v Speaker 1>owns her name and the phrase diamonds are a Girl's

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<v Speaker 1>Best Friend, which of course is the famous song from

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<v Speaker 1>Gentleman Prefer Blonde. But her image is actually public record.

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<v Speaker 1>There was a rather famous case back in two thousand

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<v Speaker 1>and twelve where it was decided that she did not

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<v Speaker 1>have any right of publicity. This is one of those

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<v Speaker 1>make sure you pay your taxes situations. When she passed

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<v Speaker 1>in nineteen sixty two, they argued that she lived in

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<v Speaker 1>New York because they didn't want to pay California inheritance taxes,

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<v Speaker 1>so they said she was a resident of New York.

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<v Speaker 1>Fast forward years later and she's very popular and they

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<v Speaker 1>want to take advantage of the right of publicity. And

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<v Speaker 1>they said, oh, no, she was domiciled in California when

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<v Speaker 1>she passed. And the court said, no, you can't say

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<v Speaker 1>she lived in New York for purposes of taxes and

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<v Speaker 1>then say she lived in California for write a publicity.

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<v Speaker 1>We stick with the first one, which is New York.

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<v Speaker 1>So there is no right a publicity for Marilyn Monroe,

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<v Speaker 1>but the trademarks of her name are still owned. Her

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<v Speaker 1>estate was divvied up. Yeah, so when she passed, obviously

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<v Speaker 1>she had no children, there was some bequests, but after

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<v Speaker 1>that of her estate went to her therapist, who then

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<v Speaker 1>later donated the money to a hospital in London for

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<v Speaker 1>children with mental health issues that's named after Sigmund Freud's

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<v Speaker 1>daughter Anna. Of her estate went to her acting coach,

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<v Speaker 1>the named Lee Strasburg, and he owned the rights until

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<v Speaker 1>his death and his third wife, who was actually I

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<v Speaker 1>think younger than Maryland, inherited it the rights from Lee Strasburg.

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<v Speaker 1>So Anna Strasburg. There was a number of lawsuits over

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<v Speaker 1>the scope of the rights and things like that, and

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<v Speaker 1>she eventually sold the rights to a branding company SAMG,

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<v Speaker 1>which then later got them to authentic brands. It's had

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<v Speaker 1>a rather winding history. So the counterfeiters in this instance

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<v Speaker 1>center only using her name or that phrase diamonds are

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<v Speaker 1>a girl's best friend. So yes, they could actually print

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<v Speaker 1>T shirts with her face on it and it wouldn't matter,

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<v Speaker 1>nobody would be able to do anything about it. But

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<v Speaker 1>they were putting a name on them. Yes, and no

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<v Speaker 1>matter how you dice it, Marlon Murrow is popular. She

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<v Speaker 1>has inspired legions of imitators. You know Madonna with the

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<v Speaker 1>material Girls songs, You've got Anna, Nicole Smith, You've got

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<v Speaker 1>drag queens everywhere. So everybody wants a piece of Maryland

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<v Speaker 1>and authentic brands has one portion of it that's very

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<v Speaker 1>valuable is her actual name and this phrase diamonds are

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<v Speaker 1>a girl's best friend. Just think about it. If you're

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<v Speaker 1>selling jewelry, isn't that a phrase you want to use

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<v Speaker 1>all the time. Or you want to put the image,

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<v Speaker 1>but you want to put the name because maybe some

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<v Speaker 1>of the gen Z kids don't know who she is

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<v Speaker 1>that you put the name. They police that very strongly.

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<v Speaker 1>There were dozens and dozens of virtual retail stores that

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<v Speaker 1>they tracked down, and it was actually really complicated work

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<v Speaker 1>to identify who was running these stores, try and contact

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<v Speaker 1>who they were. The way they laid it out in

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<v Speaker 1>the quick documents, it's really kind of a cat and

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<v Speaker 1>mouse game between these brand owners and the virtual storefronts.

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<v Speaker 1>It's not enough in these instances just to seize the goods.

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<v Speaker 1>If you can even get to the goods, well, you

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<v Speaker 1>can't see the goods, and in some instances like Amazon,

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<v Speaker 1>that the goods will be kept at an Amazon warehouse.

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<v Speaker 1>And you know, there's a lot of debate over whether

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<v Speaker 1>the places like Amazon or Ali Baba or at the

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<v Speaker 1>or eBay are doing enough to police. And that's kind

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<v Speaker 1>of side issue. How do you kind of go after

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<v Speaker 1>these virtual storefronts in the pocketbook and you can't see

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<v Speaker 1>the goods. You're not going to go around to, you know,

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<v Speaker 1>anybody who buys a T shirts and say give me

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<v Speaker 1>that T shirt back because it's a counterfeit. So what

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<v Speaker 1>they have to do is they do everything in secret,

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<v Speaker 1>behind the scenes, and they try and track down surreptitiously.

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<v Speaker 1>They have lawyers who are specialized in this identify who

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<v Speaker 1>are the people behind the websites. Then they file John

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<v Speaker 1>Doe lawsuit. And the law firm that does the work

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<v Speaker 1>actually doesn't file the lawsuits anymore because they know that

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<v Speaker 1>the counterfeiters are on the lookout for lawsuits that they filed,

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<v Speaker 1>So they outsourced the lawsuit to another firm that won't

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<v Speaker 1>be associated with the authentic brands, and they file the

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<v Speaker 1>entire lawsuit under steal It's ABC versus d e F

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<v Speaker 1>And then they go to the judge and they lay

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<v Speaker 1>out and say, we have this problem, and we have

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<v Speaker 1>all these counterfeits. They have to provide a lot of

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<v Speaker 1>information to the judge because judges don't generally like anonymous lawsuits,

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<v Speaker 1>So they lay out all the information. They get a

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<v Speaker 1>restraining order that not only says, oh, these platforms can't

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<v Speaker 1>allow these store fronts to sell the information, but also

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<v Speaker 1>directs the platform to freeze the assets. You know, all

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<v Speaker 1>the money is being funneled through Amazon and Ali Baba,

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<v Speaker 1>and those assets are frozen. And that's what the Maryland

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<v Speaker 1>Morrow folks were able to do. Now they have to

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<v Speaker 1>go back and figure out, okay, how much of those

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<v Speaker 1>assets were from the counterfeit goods, and then get a

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<v Speaker 1>court order to take that amount of money. You don't

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<v Speaker 1>want to be too greedy and ask for the entire

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<v Speaker 1>storefronts assets. You just want to be able to get

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<v Speaker 1>the part you say is attributed to the counterfeiting, so

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<v Speaker 1>the judge will go along with it. I'm surprised that

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<v Speaker 1>they were even able to do that, because I would

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<v Speaker 1>think that the counterfeiters would just close up shop and

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<v Speaker 1>get another website exactly. And that's the reason why they

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<v Speaker 1>file under seal is that they're trying to get these

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<v Speaker 1>orders to the platforms before the storefronts realize that anybody

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<v Speaker 1>notices that they're there, because the minute that they realized that,

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<v Speaker 1>oh there's a target on our back, they're going to

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<v Speaker 1>shut down and open in another site, are opened under

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<v Speaker 1>another name. So you do all of this very nefarious

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<v Speaker 1>James Bondish under steal behind closed doors, and then boom

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<v Speaker 1>come forward and with this asset freeze. The next thing

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<v Speaker 1>you know, you go to your website, collect the money

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<v Speaker 1>or handle sales and you realize, oh my gosh, it's

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<v Speaker 1>been frozen by the court. And also, it's not like

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<v Speaker 1>handbags or shoes where when the consumer gets them or

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<v Speaker 1>sees them can tell that they're counterfeiting a lot of

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<v Speaker 1>instances because in this you wouldn't know if it was

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<v Speaker 1>a counterfeit or not. No, because it's all virtual. It's

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<v Speaker 1>over the web. I mean, how many times have you

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<v Speaker 1>bought something over the web, even through a legitimate store

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<v Speaker 1>and it's not exactly what you wanted. You wanted a

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<v Speaker 1>red shirt and it counted orange many times, or you

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<v Speaker 1>wanted large and it's small, So there's no way of

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<v Speaker 1>knowing and quite frankly, a lot of people. You have

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<v Speaker 1>a rising number of people who are shopping online on

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<v Speaker 1>the internet because the pandemic, and a lot of people

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<v Speaker 1>hurt and financially, so I'm not sure they would even

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<v Speaker 1>care whether it's legit or not. In some instances, there

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<v Speaker 1>are a lot of efforts that are being made by

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<v Speaker 1>the International Trademark Association. Philip Morris has just set up

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<v Speaker 1>a new group with a whole bunch of other companies

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<v Speaker 1>and law enforcement to try and educate people that that

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<v Speaker 1>counterfeit is much like movie piracy, is not a victimless crime.

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<v Speaker 1>You're going to have these problems with quality, You're going

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<v Speaker 1>to have problems with if you want to return something,

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<v Speaker 1>who's gonna who's going to get it? You know, obviously

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<v Speaker 1>the brand owners are being ripped off and they're losing

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<v Speaker 1>the value of their brand. And there are some allegations

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<v Speaker 1>that because of the scale of counterfeiting involved, that it

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<v Speaker 1>involves organized crime. So this is you know, cheap and

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<v Speaker 1>easy money for them to fund other things that they're

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<v Speaker 1>doing the various deeds and is counterfeiting on the increase

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<v Speaker 1>since the COVID shutdown tremendously, there's not an official word

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<v Speaker 1>on exactly how much, but the people that I spoke

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<v Speaker 1>to said that it's actually something that they are not

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<v Speaker 1>sure how to quantify. The International Trademark Association had projected

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<v Speaker 1>that digital piracy would reach one point nine trillion annually

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<v Speaker 1>next year. They actually think it's already passed that number

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<v Speaker 1>because of the sheer volume of online shopping because of

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<v Speaker 1>the pandemic. You talked to Professor J. Kennedy who told

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<v Speaker 1>you that just about every product on the market has

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<v Speaker 1>a counterfeit version sold on the cheap. Yes. And I

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<v Speaker 1>did an interview with someone years ago who told me

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<v Speaker 1>that he was over in China and he looked and

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<v Speaker 1>there was a Porsche. Every single part of that Porsche

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<v Speaker 1>was counterfeit, like from the engine, that tires, the body,

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<v Speaker 1>the seeds, everything. You could make an entire Porsche out

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<v Speaker 1>of counterfeits. There are problems with counterfeit parts for your cars,

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<v Speaker 1>and sometimes, you know, there's a debate for car parts,

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<v Speaker 1>for instance, on legitimate replacement parts versus counterfeit parts and

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<v Speaker 1>what's authorized and what's not. So it's a really complicated issue.

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<v Speaker 1>But you know, software gets pirated. There's literally nothing that

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<v Speaker 1>doesn't you know, there's somebody who can make it cheaper

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<v Speaker 1>without paying for the brand or paying for all the

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<v Speaker 1>safety requirements. Somebody will do it. Tell us about this.

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<v Speaker 1>There's a bill being discussed by the House Panel that

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<v Speaker 1>would increase liability for platforms like Amazon and eBay. Yes,

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<v Speaker 1>there's a lot of efforts to try and figure out

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<v Speaker 1>how do you deal with this problem, And some people

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<v Speaker 1>say that, you know, Amazon, eBay, they're just not doing enough.

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<v Speaker 1>They say that they're working on these and that they'll

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<v Speaker 1>shut down the shops when they find out there's counterfeits.

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<v Speaker 1>But there's a lot of arguments that they're not really

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<v Speaker 1>doing enough. Conversely, there are actually some people saying they're

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<v Speaker 1>doing too much. But there is a lobbying fight that

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<v Speaker 1>would require these third party marketplaces, the internet platforms that

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<v Speaker 1>connect the sellers to the buyers like eBay and Amazon

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<v Speaker 1>to verify the identity of who's selling the products and

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<v Speaker 1>provide transparency who's behind the curtain, so to speak. It's

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<v Speaker 1>a multifaceted problem and I'm not sure that there's going

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<v Speaker 1>to be any solution anytime soon. Thanks Sue. That's Susan Decker,

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<v Speaker 1>Bloomberg Patent Reporter. And that's it for this edition of

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<v Speaker 1>the Bloomberg Law Show. I'm June Grosso and you're listening

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<v Speaker 1>to Bloomberg