Business group presses government for piracy reforms

By Mary Childs

WASHINGTON (Reuters) - Leading U.S. business groups on Thursday urged stronger U.S government action to stop trafficking of pirated or counterfeit goods, which they said costs the U.S. economy between $200 to $250 billion per year.

"Every product in every industry is vulnerable," said Bruce Josten, Executive Vice President of the U.S. Chamber of Commerce. "We can no longer accept counterfeiting and piracy as just a cost of doing business."

Members of the Coalition Against Counterfeiting and Piracy (CACP) presented a six-pronged agenda aimed at stopping the trafficking of illegal goods, which they blame for 750,000 lost U.S. jobs.

Their proposal includes tougher border control and penalties for counterfeiters, more funding for the Homeland Security and Justice Departments, reformed judicial processes, and improved coordination and education for consumers.

The coalition included U.S. movie and recording industry groups, as well as drug manufacturers, the U.S. Chamber of Commerce and the National Association of Manufacturers.

Intellectual property protection has become a particular sore point in the U.S.'s relationship with China, and the groups estimate global trade in fake goods to be about $500 billion to $600 billion per year.

"Intellectual property theft stabs at the heart of the U.S. economy," said John Engler, President and CEO of the NAM, calling creativity and innovation the U.S.'s comparative advantage. "There are some products that literally put lives at risk. We saw what happened with pet foods."

TAINTED PET FOOD

Pet food from China, tainted with melamine, caused the death of cats and dogs across the United States this year.

Concerns about "filthy" imports from China heightened after the U.S. Food and Drug Administration warned that it found a poisonous chemical in toothpaste made in China.

But few Americans realize that their new toothbrush could be counterfeit.

Oral-B was just one brand among a myriad of fake products displayed by the groups, including faux Louis Vuitton bags, New Balance shoes, DVDs, brake shoes for cars, prescription medication for cancer, erectile dysfunction and mental illness, and polypropylene mesh used in surgery.

While instances of piracy in the pharmaceutical industry are more rare than other sectors, the threat is growing, and it's serious, said Chris Singer, Chief Operating Officer for Pharmaceutical Research and Manufacturers of America.

"Even our experts have a really hard time telling the difference," Singer said.

Stronger overseas enforcement and government partnerships are needed to temper the flood of goods into the United States, whose strong laws against counterfeiting and piracy should be the standard for other countries to meet, he said.