Knock-offs and counterfeits are often used interchangeably. This use is incorrect.
Knock-offs are inspired pieces. I italicized inspired because many people use the word as a cover for their copies that barely stop short of using the original design’s trademark name. Generally, knock-offs copy another designer’s style without trying to pass off the new item as the original. Knock-offs can be products that have a confusingly similar overall appearance to the copied products but knock-offs do not contain any identical logos or federally registered brand names.
Fashion knock-offs are legal in the U.S. but a counterfeit is not. In other geographic locations, namely France, there are protections for fashion, so even a knockoff is illegal in France. In the U.S., if the Innovative Design Protection and Piracy Prevention Act were passed, designs that are “substantially identical” to originals would be protected against for a three-year period.
Counterfeits are goods that are passed off as the originals they copy. Counterfeits are made to be confusingly similar to the authentic goods by even infringing on the genuine good’s trademarks. These products are intended to confuse consumers before, during, or after the time of sale. Counterfeits present fraud on the public. Counterfeits displace sales of the genuine goods they copy. The manufacture and sale of counterfeits is illegal. During 2011 in New York, councilwoman Margaret Chin introduced a bill that would make it illegal to purchase counterfeit goods. This bill suggests a penalty of up to $1,000 and up to one year imprisonment.
Penalties for illegal participation with counterfeits can range from paying damages to criminal sanctions.
Trademark owners may bring civil lawsuits against people who produce or sell counterfeit or knock-off products. While it is more difficult to argue against knock-offs, if an original designer can show that the design itself serves as a trademark by signaling to consumers that the product is related to the authentic, then trade dress protection can be extended to otherwise unprotected designs.