The House passed a bill Monday that would increase criminal counterfeit penalties at a time when bogus apparel, handbags and accessories are costing U.S. companies billions of dollars in lost sales a year.
The bill would expand penalties to those who traffic in bogus labels and packaging, and would require the forfeiture of the equipment used to make the items.
The Stop Counterfeiting in Manufactured Goods Act, sponsored by Rep. Joe Knollenberg (R., Mich.), which was approved on a voice vote, would also require that restitution be paid to the trademark owners whose brands were counterfeited.
Under current law, trafficking in counterfeit labels or packaging is not illegal if they are not affixed to the finished counterfeit product, and if a counterfeiter is convicted, the fake products are destroyed but not the equipment used to make them, according to lawmakers.
The bill now moves to the Senate, where passage is expected.
According to a November 2004 report issued by William C. Thompson Jr., New York City comptroller, about $456 billion was spent on counterfeit goods worldwide in 2003.