Georges Geoffroy, brand protection manager at LVMH Moët Hennessy.Louis Vuitton S.A. (LVMH), was elected to be the vice-chair of the Intellectual Property Committee of the Franco-Russian Chamber of Commerce and Industry, which was formed on 22 November 2018. Alexandra Bakhtiozona met with Georges at the first committee meeting, which was dedicated to the legal protection of intellectual property assets in the fashion industry. George Geoffroy, based in Paris and being in charge of combating counterfeit in many regions all over the globe, shared his unique experience of fighting counterfeit in an interview form.
You have already been working with LVMH for 7 years. How did all begin? How did you join the LVMH Group?
Georges: With my internship to begin with. I have been working with grey market issues (parallel import issues), mainly dealing with French law. 4 years ago I started working on counterfeit matters. Currently, I am managing perfumes and cosmetics brand protection. As you can see, my career path has been broad.
LVMH Group consists of more than 70 brands in 5 sectors: perfumes and cosmetics, fashion goods, wine and spirits, watches and jewelry, and selective distribution. LVMH is a global leader in the luxury industry, with last year's turnover amounting to around 40 billion euros. Therefore, since working here I have had the opportunity to get an overview of the counterfeiting situation worldwide and can make comparisons between different regions and countries.
How do you fight counterfeits in Russia?
Georges: On the 3 past years we have had more than 128 counterfeiting cases. 28 of them were initiated by customs authorities and 97 cases were initiated by Russian police. There was a significant increase in the amount of counterfeit cases compared to previous years. For example, in 2016, we were involved in approximately 20 cases, while now we are participating in more than 70 cases. This, however, does not mean that more counterfeit goods are circulated within the Russian market, but that we now cooperate and coordinate better with Russian state authorities.
For example, in Izhevsk, last year it was the first case of halting the local production of counterfeit cosmetics and perfumes. We have seized more than 14,000 finished goods.
Does LVMH's anti-counterfeit strategy for the perfumes and cosmetics sector have any differences compared to other sectors?
Georges: In fighting counterfeit perfumes and cosmetics we have a zero tolerance policy. This means that we always make a complaint against an infringer regardless of the number of counterfeit goods – it may be 1 piece or 1 million pieces. We face an infringement – we make a compliant.
Also, we try to be very proactive by participating in investigations and conducting market surveys in order to get the overview of the counterfeit situation in a city, in a region or across a country. This in-depth understanding of the situation is essential for choosing the right strategy for each particular case.
One more aspect is our close cooperation with state authorities. We support the police in their endeavor to fight counterfeits. At each step of the investigation we provide all necessary information as well as provide training in order to remind authorities of LVMH brands and products, and explain how to distinguish fake cosmetics and fake perfumes from genuine ones.
Is Russia an important market? What was your first reaction when you learnt that you would be in charge of Russia?
Georges: We are working in more than 70 countries worldwide. Wherever we are, we rigorously fight against counterfeiters. Russia is a major actor in the world from economic, diplomatic and political point of view. For LVMH Russia is an extremely important market.
Each country has its specificities, and for each particular country we have to identify and adopt the most efficient strategy. For Russia I must admit that customs authorities and police are very active and cooperative when it comes to fighting counterfeiting. What we have to do as right holders is to support state authorities, to make them more sensitive about our issues, and to take time to meet with them and share best practices with them. From my professional expertise, I met the Volgograd customs two years ago; last year I had a meeting with Izhevsk police. Just yesterday I was in Makhachkala (Dagestan) to meet local police officers and discuss counterfeiting issues in this region.
Could you give an example of one case in Russia that impressed you?
Georges: I can think of two cases. The first was in Izhevsk. It was the first time we discovered the production of counterfeit goods in Russia. Previously we believed that all counterfeit goods marketed in Russia were produced in China or Turkey. But this time we found a significant quantity of counterfeit goods that had been produced locally. In addition, we faced an organized criminal network linked with local political authorities. Therefore, it was challenging to properly control each step of the investigation. We had to support the police with collecting evidence and all important information they needed. What was also important is bringing together the Izhevsk police, Saint-Petersburg police and Kazakhstan police so that they could cooperate.
We also faced many logistic issues. We had to send our employees to the police forces to help the police identify the counterfeit products.
Another challenging case was in 2016. Our team investigated 23 tons of counterfeit perfumes of many brands. We had to maintain the customs process and simultaneously support the police investigation. Then we received the decision of the first instance court. It was in our favor, but it was appealed. The appeal court decided to return the goods to the infringer. We had to work with the bailiffs in order to prevent the release of the goods. We lodged our appeal with the cassation court.
At the same time, the infringers made a complaint against LVMH Group arguing that our claim was disturbing their business model. I then went to Dagestan and met with the infringers for negotiations. As for now, the case is still pending.
The cases you mentioned were about trademark infringements. There is a widely discussed idea that perfume deserves copyright protection as well. Do you think that perfumes should also be protected by copyright, or is trademark protection sufficient?
Georges: From my point of view, trademark protection is enough. Copyright protection is granted to literary and artistic works. LVMH employs copyright protection for its books and videos, but relies on trademark protection when it comes to protection of its brand names and logos.
Have you ever faced illegal use of industrial designs?
Georges: Yes, infringers sometimes go beyond copying names of our goods, and also copy designs of the bottles and cups. They may not even mention the names of our perfumes, but still imitate the bottle of this perfume. That is why in some countries we ensure protection of the bottle silhouettes. At the beginning of 2018, for example, we prevented the import of copycatted perfume bottles to Russia.
Can a perfume formula be protected?
Georges: No, a formula cannot be protected. However, companies like Dior, Guerlain, Givenchy, Kenzo invest a lot in research, to ensure good quality of the products. Counterfeit producers cannot ensure the same quality.
How do you prioritize your targets? How do you decide to whom you will send a warning letter or file a court claim: a manufacturer, a wholesaler or a retail seller?
Georges: We focus first on the points of sale where counterfeit goods are sold. At the same time, during investigations of some cases we uncover that behind a small shop there is a huge organized criminal network.
What are some of the best anti-counterfeiting practices in Russia?
Georges: Each country has its own specificity which we need to take into account while deciding upon our strategy for fighting counterfeits there. The most important part is to understand how the system is really working. Again, in Russia it is very important to be in contact with state authorities, to support them in investigation, and to run bespoke training. However, managing all this work with customs authorities and police is a complex task, since Russia is the largest country in the world.