Jim-

There is a concept in Trademark law called "secondary confusion" that I believe is somewhat analagous to the case at hand. To put it simply, the primary reason trademarks exist is to allow the public to know who makes a particular product. Basically, we all know a Rolex is a good watch, so if we see the Rolex name on a watch, we know it's good. We therefore feel justified spending ten grand for it. Thus, the test of trademark infringement is whether a buyer is likely to be confused into thinking Rolex made the watch when they actually didn't.

For that reason, the guys who sell fake Rolex's on street corners tried to defend the practice saying that everyone who bought a watch with the Rolex name on it for $10 from them knew darn well it was not a real Rolex. Thus, they argued they had not infringed the Rolex Trademark under the legal test of infringement. Further, they argued they weren't hurting anyone. Buyers knew they weren't buyign a Rolex, and the Rolex copmpany was certainly not losing customers. After all, the potential buyers of a $10,000 watch were not about to spend $10 on a cheaper version on the street corner.

The Rolex company argued however, that the fake watches would cause confusion on the secondary market. People who see every Tom, Dick & Harry wearign aRolex, might begin to think Rolex was not a quality brand. They might begin to think they were common. And thus the Rolex name was hurt.

The courts agreed.

The point, of course, is that if you produce a counterfeit, you can be harming the market as a whole, even when you are not ripping off those who buy from you.

I will leave it up to others to determine whether these situations are analagous. I just thought some might find the xample intersting.

Al