Birth Place - Garage

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The plot of yet another story on the subject of counterfeit is quite simple. The place of action – Naberezhnye Chelny, more precisely - boxes of garage-building cooperative KAMAZ-4, which is located in the urban industrial area - Promkomzona. Time and date - October 17, 10:25 am. The main character is the private entrepreneur who organized production of solid forged torque rods for commercial auto trucks KAMAZ, which makes illegitimate use of utility models belonging to ROSTAR Research-and-Production Association and bears all the attributes of a counterfeit operation. Namely, the intentional fabrication and processing in such a manner so as to create an imitation of the products of other manufacturers in the absence of the legal rights to do so. The climax – the sales of two rods, the fact of which was established by the MVD law enforcement officers. The outcome: confiscation of the whole consignment – 45 counterfeit parts, a commencement of administrative proceedings and an imposition of a monetary fine.

It is the typical plot of a detective story on the topic 'Bootlegging of auto parts'. Everybody earns their daily bread to the extent of their talents and potentials. The majority does so honestly: you sleep better when your business is legitimate and your reputation is clean. Some, as in this case, try to do it under the table hoping to they they won’t get caught. Sometimes they don’t, but not always. The commercial endeavor of this adventurous young man is not that original – even in a garage, it is ultimately possible, given the appropriate tools, to set up the production and manufacturing of solid forged torque rods that are structurally indistinguishable from the originals bearing the trademark of ROSTAR. However, in order to do so, several requirements have to be met, the most important one of which is to obtain a Licensing Agreement with the party that holds the legal rights of the product. Our hero took a knock by violating the article 7.12 of the Code of Administrative Offenses – part 2, that defines such actions as an illegitimate usage of an invention, a utility model (i.e.original technological solution), or an industrial design without the consent of its creator. In this case, lacking the consent of the patent holder, ROSTAR, who has all the rights to defend its intellectual property. And that’s exactly what it did. The officers from the Department of Economic Security have detected this illegal production and, promptly informed the representatives of the Ministry of Interior, who conducted an investigation and confirmed the violation of the law.

To quote Ostap Bender: "One must honor the Criminal Code". The entrepreneur decided not to argue his defense, for it is hard to deny such a conspicuous administrative violation, he fully confessed. Now he counts his losses: wasted manufacturing expenses of almost 50 rods plus the fine of 15,000 Rubles, for a combined total of 150,000 Rubles. The punishment was not that harsh; the court took into account not only the fact of his confession, but also that this breach is a first offense, and that he has two dependent children.

The moral of this story extends far beyond the above example. Naturally as long as there is a demand for counterfeit products, namely because of their lower price tag than the original, the 'garage production of the spare parts' will flourish. But wait a moment! t seems that, at least for the counterfeit manufacturers that imitate the ROSTAR products, the word 'flourish' is a misnomer. The witness to this are the hapless entrepreneurs, whose business has withered before it had a chance to bloom, moreover it resulted in serious legal and financial consequences. The reason is simple. The department of economic security of ROSTAR has a sound structure for protecting the company's economic interests, its honor, and its dignity from any infringement of intellectual property. These are the implementation of preventive measures including the monitoring of the auto parts markets and detection of the counterfeits and of products manufactured in violation of the patent rights of ROSTAR, as well as effective coordination with the appropriate police departments.

As one person knowledgeable in the trade has put it: "Once a nail gets caught, the whole bird is cooked". It is only a matter of time before the department of economic security of the ROSTAR will find the rest of the manufacturers of counterfeit products, that have not yet been detected.

Alexei Dvinsky

05.12.2011