Can a consignment shop get away with selling fake designer purses?

August 12, 2006 9:18 PM

Is it legal to knowingly sell counterfeit handbags at a consignment shop? Is there a reasonable expectation of authenticity that the consumer has?

I recently visited a resale store that touted itself as offering designer and name-brand items.

While I was browsing, I noticed a wide selection of Louis Vuitton bags and a few Chanel ones. All were originally priced at either $60 or $40, depending on size, and all had since been marked down 50%. When I asked the owner whether the bags were real, she said without hesitation that they were all fake, and that "some lady had brought them from New York." She went on to tell me that she sold everything at 30% of retail price, and that a Chanel bag would cost several hundred dollars in her store were it real.

Obviously, "caveat emptor," "if it's too good to be true, it probably is," and all that. But does the consumer have a reasonable expectation of authenticity? If her price had been more in line with what I expected, like $300-400, could she still justify selling fake ones? Does it matter that she was selling other pieces by well-known "names" at far below 30% of their retail (ex. a Theory button-down for probably <5 % of its retail price)? and further, is this legal? lvmh obviously a href="http://www.businessweek.com/investor/content/jun2006/pi20060613_187965.htm?chan=topStories_ssi_5">felt very strongly about Sam's Club selling fake Fendi. Does a consignment shop have the same obligations toward authenticity? The bags were not marked as fake, nor were they obvious fakes like, say, this one.

For what it's worth, I ended up deciding not to buy anything at the store, because I just didn't feel comfortable supporting a place that knowingly sold fake bags while boasting of its selection of designer apparel. I'm pretty confident that the girl who tipped me off to the store didn't know that she'd bought a Chanel fake, and it bothered me.

posted by anjamu to clothing, beauty, & fashion (3 comments total)

It is not legal (in the United States) to sell counterfeit goods. It has as much to do with protection of the legitimate names as the consumer. See 18 U.S.C. § 2320, Trafficking in Counterfeit Goods or Services.

(I am a lawyer, but I do not represent you, and I am probably not licensed in your jurisdiction. This is not legal advice. And so on.)
posted by raf at 9:43 PM on August 12, 2006

The price is irrelevant. The shop could be charging 50c or full recommended retail and it would still be illegal in most Western countries (and I see from your profile that you're in the US).

Yes, the customer most likely would have a 'reasonable expectation of authenticity'. This probably breaks a whole lot of laws on top of the anti-counterfeiting one raf cited: trademark, copyright, fair trading, fraud, etc etc. It's possible that even possessing one of these items would be illegal.

Reselling non-counterfeit items is probably going to be okay, though, for whatever price the shop wants. Clothes generally don't come with end user licence agreements.

(ditto raf's disclaimer)
posted by A Thousand Baited Hooks at 10:25 PM on August 12, 2006

Not legal in the UK either. Most of Europe, as far as I know, has very stiff penalties for selling counterfeit products.
posted by Amizu at 8:09 AM on August 14, 2006