Luxury jean designers looking to stop sellers of counterfeit denim duds have long turned to lawyers to enforce their trademarks. But law firms can be too expensive to use in pursuing smaller resellers who are a big part of the problem.
Los Angeles litigation boutique Gareeb Pham LLP is trying to capitalize on the demand in that area by offering a flexible billing arrangement for ferreting out apparel fraud. It is effective in pursuing the smaller operators.
Founding partners Alexander Gareeb and Christopher Pham opened their downtown L.A. firm one year ago, and have developed a process for pursuing copyright and trademark infringement claims against middlemen on behalf of their clients, including high-end brands True Religion Apparel Inc., Antik Denim LLC and Joe's Jeans Inc.
"We got into intellectual property law, we learned it and we developed this program that's suitable for a lot of industries, including the apparel industry," Gareeb said.
The firm, which has six attorneys, also works on behalf of makers of custom wheels who want to stop distribution of fake versions of their products.
Gareeb and Pham chose to concentrate on the apparel industry because they already had some client contacts. So they developed a business model where each manufacturer gives the firm seed money, around $50,000, to scour Web sites such as eBay and purchase jeans that appear to be fake. The lawyers help the manufacturer analyze the authenticity of the jeans through several different processes. If the jeans are counterfeit, a copyright and trademark infringement lawsuit is filed in federal court.
Other attorneys pursue trademark violations by Internet research, but Gareeb Pham's billing structure allows it to file more lawsuits than other firms.
In order to make their services affordable to clients, Gareeb Pham charges a reduced hourly rate. To compensate, the firm later takes a percentage of the money recovered from a settlement or monetary damages awarded after a trial.
"Instead of the $300 to $400 billable hour, which is what you will find in the arena because intellectual property trial work is specialized, we have created a contingency-based structure where the law firm and the client share in the recovery," Pham said.
With a flexible billing arrangement, the firm is able to take a more aggressive approach, filing multiple lawsuits a week to weed out counterfeit sellers and manufacturers.
Other firms will only take this type of case on contingency if the potential reward is worth the risk, said Michael Heimbold, a partner at Steptoe & Johnson LLP.
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