They even have counterfeit stores in China...

You thought they only made counterfeit goods in china?  They also do counterfeit stores...

It’s an Apple store!
Or is it?
... I went inside and poked around. They looked like Apple products. It looked like an Apple store. It had the classic Apple store winding staircase and weird upstairs sitting area. The employees were even wearing those blue t-shirts with the chunky Apple name tags around their necks.

This blog post is from someone living in Kumming, China 

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Are you listening, Steve Jobs?

July 20, 2011 by BirdAbroad
 

The Western news media is replete with pithy descriptions of the rapid changes taking place in China: China has the world’s fastest growing economy. China is undergoing remarkable and rapid change. This represents a unique moment for a society changing as quickly as China.
You probably read such things in the paper every day – but if you have never been to China, I’m not sure you know quite what this means on a mundane level. As I’ve mentioned elsewhere on this blog, in the 2+ years that RP and I have been in our apartment, much of the area around us has been torn down, rebuilt, or gutted and renovated – in some cases, several times over. I had the thought, only half-jokingly, that when we returned from a couple months abroad, we might not be able to recognize our apartment building. Or that it might not be there at all.
As it turns out, my fears were baseless – our scrappy little home remains. The neighborhood, however, has definitely kicked it up a notch or seven. Starbucks has opened not one, but THREE branches (that I encountered) within a 10 minute walk of one another. An H&M has opened across from our apartment building. These are the kinds of major Western brands that were previously only represented in Kunming by fast food chains like McDonald’s and KFC. Our neighborhood has quickly become the swanky shopping center of the city.
So when we strolled down a street a few blocks from our house a couple weeks ago, I was only sort of surprised to see this new place, one that any American of my generation can probably recognize instantaneously:

It’s an Apple store!
Or is it?
RP and I went inside and poked around. They looked like Apple products. It looked like an Apple store. It had the classic Apple store winding staircase and weird upstairs sitting area. The employees were even wearing those blue t-shirts with the chunky Apple name tags around their necks.





We proceeded to place a bet on whether or not this was a genuine Apple store or just the best ripoff we had ever seen – and to be sporting, I bet that it was real.
I know, you guys are laughing: an Apple store in Kunming? No one who doesn’t know me personally has ever heard of Kunming before. Kunming is the end of the Earth. It’s all true – but seriously, China warps your mind into believing that anything is possible, if you stay here long enough. When we went back to this store 5 days later and couldn’t find it, having overshot by two blocks, I seriously thought that it had simply been torn down and replaced with a bank in the mean time – hey, it’s China. That could happen.
You have already guessed the punchline, of course: this was a total Apple store ripoff. A beautiful ripoff – a brilliant one – the best ripoff store we had ever seen (and we see them every day). But some things were just not right: the stairs were poorly made. The walls hadn’t been painted properly.
Apple never writes “Apple Store” on it’s signs – it just puts up the glowing, iconic fruit.

The name tags around the necks of the friendly salespeople didn’t actually have names on them – just an Apple logo and the anonymous designation “Staff”. And of course, Apple’s own website will tell you that they only have a few stores in Beijing and Shanghai, opened only recently; Apple famously opens new stores painstakingly, presumably to assure impeccable standards and lots of customer demand.
Is this store a copy of one of those in Beijing? A copy of a copy in another Chinese city? A copy of a copy of a copy?! While you’re pondering that, bear in mind: this is a near-perfect ripoff of a store selling products that were almost unknown when we first came to China. My white MacBook was likely to draw only blank stares or furrowed brows as I sat gnashing my teeth trying in vain to get a piece of Chinese software to run on it.
Being the curious types that we are, we struck up some conversation with these salespeople who, hand to God, all genuinely think they work for Apple. I tried to imagine the training that they went to when they were hired, in which they were pitched some big speech about how they were working for this innovative, global company – when really they’re just filling the pockets of some shyster living in a prefab mansion outside the city by standing around a fake store disinterestedly selling what may or may not be actual Apple products that fell off the back of a truck somewhere.
Clearly, they had also been told that above all, they must protect the brand. As I took these photos I was quickly accosted by two salespeople inside, and three plain clothes security guys outside, putting their hands in my face and telling me to stop taking photographs – that it wasn’t allowed. And why wasn’t it allowed? Because their boss told them so.
I…may or may not have told them that we were two American Apple employees visiting China and checking out the local stores. Either way, they got friendlier and allowed me to snap some pictures.


And the best part? A ten minute walk around the corner revealed not one, but TWO more rip-off Apple stores.


Some store managers may have dozed off briefly during certain parts of the lecture on How to Completely Ignore Intellectual Property Rights:

Anyone from Apple want to come down to Kunming and break open a can of IPR whoop-ass?

Posted in Uncategorized | Tagged China, Fake Apple Stores, Is Anybody Out There? | 427 Comments »

Are you listening, Steve Jobs? « BirdAbroad

H.P.'s Foreign Entanglement - NYTimes.com

H.P.’s Foreign Entanglement

September 13, 2010, 11:30 am

Peter J. Henning follows issues involving securities law and white-collar crime for DealBook’s White Collar Watch.
The last month or so has not been very pleasant for Hewlett-Packard.
The company’s recent 10-Q disclosed that the Justice Department and Securities and Exchange Commission have expanded an investigation of possible bribe payments in connection with contracts the company obtained in Russia. Such payments may violate the Foreign Corrupt Practices Act (F.C.P.A.), an area where the federal government has investigated more aggressively over the last few years.
This disclosure comes on top of other recent legal problems at H.P. Joe Nocera’s recent column in The New York Times described H.P.’s directors as “the most inept board in America” for its lawsuit against its former chief executive, Mark V. Hurd. On Aug. 30, the Justice Department announced a $55 million settlement of a civil fraud claim against H.P. for paying “influencer fees” — in other words, kickbacks — in return for favorable recommendations to the federal government to buy the company’s products.

About White Collar Watch

Peter J. Henning, writing for DealBook’s White Collar Watch, is a commentator on white-collar crime and litigation. A former lawyer at the Securities and Exchange Commission’s enforcement division and then a prosecutor at the Justice Department, he is a professor at the Wayne State University Law School. He is currently working on a book, “The Prosecution and Defense of Public Corruption: The Law & Legal Strategies,” to be published by Oxford University Press.

As Mr. Nocera pointed out, H.P. is unlikely to succeed in its legal battle with Mr. Hurd, but that is more of a distraction than anything else. A widening F.C.P.A. investigation, on the other hand, may end up costing the company millions of dollars in legal fees as it deals with demands for documents while conducting its own internal inquiry. And any settlement with the government would likely involve both criminal fines and civil monetary penalties, along with other remedial measures, ratcheting the price up further.
The bribery investigation began in Russia in connection with a contract with a former German subsidiary of H.P. that involved the installation of a computer network in, of all places, Russia’s chief prosecutor’s office. Russian and German prosecutors are looking into the transaction, which took place from 2002 to 2006, and have requested documents from the company.
In its 10-Q, H.P. notes for the first time that the investigation is not limited to that one contract in Russia: “The U.S. enforcement authorities have recently requested information from H.P. relating to certain governmental and quasi-governmental transactions in Russia and in the Commonwealth of Independent States subregion dating back to 2000.”
It is not clear how many contracts or transactions may be involved, but the expanded time frame and geographic scope probably means the inquiry will be an extended one, rather than something H.P. can wrap up quickly. As sometimes happens, once one part of a multinational company is scrutinized for bribery, problems in other areas can pop to the surface.
The recent settlement by Siemens of overseas bribery charges shows how corruption can spread throughout a company. Subsidiaries operating in France, Argentina, Turkey and the Middle East were found to have paid bribes to obtain contracts, and Siemens paid $800 million in criminal fines to the Justice Department and disgorgement to the S.E.C. as part of the settlement.
The F.C.P.A. is part of the federal securities laws, and most cases involve the S.E.C. along with the Justice Department because one part of the act requires corporations to maintain proper books and records, something that is rarely done when a bribe is paid. The Justice Department has become much more aggressive in pursuing foreign bribery cases, including conducting an undercover sting operation that resulted in more than 20 people being arrested on charges of offering bribes to participate in a fictitious security contract with an African nation.
The recent addition of enhanced whistle-blower rewards in the Dodd-Frank Act authorizes the S.E.C. to pay 10 percent of any recovery realized, up to a maximum of 30 percent, to those who provide valuable information related to any type of securities fraud. F.C.P.A. cases are very likely to be among the most common instances for whistle-blowing by corporate employees.
F.C.P.A. charges are also very difficult to defend once the government obtains evidence that payments were made to foreign officials “in obtaining or retaining business” in that country. The act recognizes two defenses to a charge, first the payment was lawful under the laws of the country where it was made, and second the expenses were reasonable for the promoting the product or implementing the contract.
Neither defense has been successfully offered in court to this point. Even worse, according to an article by Kyle Sheahen that will be published shortly in the Wisconsin International Law Journal, “the defenses are virtually useless in practice.”
Even if H.P. is found to have violated the F.C.P.A., that does not mean the company’s ability to win government contracts would be at risk. Professor Mike Koehler, who analyzes these issues on the FCPA Professor blog, noted that the Siemens settlement did not seem to have any real effect on the company’s relationship with the federal government. “One of the unfortunate beauties of engaging in bribery the U.S. government terms ‘unprecedented in scale and geographic scope’ is no slowdown in U.S. government contracts in the immediate aftermath of the enforcement action,” he noted.
The impact from any F.C.P.A. violation may change, however, under a bill under consideration in Congress. The legislation, called the Overseas Contractor Reform Act and passed by the House Oversight and Government Reform Committee in July, requires debarment from future government contracts for any person or company found in violation of the F.C.P.A. The bill states the policy that “no Government contracts or grants should be awarded to individuals or companies who violate the Foreign Corrupt Practices Act.”
Whether the House and Senate will pass the legislation remains to be seen, but corporate integrity is, like mom and apple pie, not easily opposed. While the current aversion to corporate America may be abating, this is the type of reform that may well take hold to put some more bite into the F.C.P.A.
For H.P., a burgeoning foreign bribery investigation is not good news because of the costs and uncertainly it engenders. If the Overseas Contractor Reform Act becomes law, it will make it even more imperative that the company try to avoid any finding of a violation of the F.C.P.A., perhaps through a deferred or non-prosecution agreement that can let it avoid a finding of a violation.
– Peter J. Henning
The Overseas Contractor Reform Act
H.P.'s Foreign Entanglement - NYTimes.com

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