Business Development

A Practical Case against Buying Counterfeit Goods

Most of us have, at one time or another, been tempted to buy knockoffs, formally known as counterfeit goods. These items are often considerably cheaper than the genuine brand and may even look identical to the real thing.

Let’s brush aside the typical intellectual rights infringement claims. I have practical reasons for not buying fakes. After reading this blog, you may want to think twice next time you encounter counterfeit goods.

Counterfeit goods, by definition, are intentionally made to pass as goods produced by well-established producers or brands sold at significantly higher prices. Alas, similarity in appearance doesn’t translate to functionality.

Most problems with knockoffs stem from these basic facts:

  1. You don’t know where they were made.
  2. You don’t know who made them.
  3. You don’t know what they’re made of.

Where the goods are made matters. Name brands and well-established producers comply with manufacturing standards and local labour laws. Fakes, however, are often made “underground,” without the scrutiny of public officials, and evade laws designed to protect workers. The work environment may be hazardous. The workers may be child labour and/or forced to work excessive hours without adequate, if any, compensation. Injuries or deaths may be covered up, leaving the victims and their families without recourse as the employer walks away with impunity.

Who makes goods is important. Fakes lure consumers with cheap prices. That means knockoff makers get them made as cheaply as possible. The workers who manufacture the fakes are seldom qualified. They may be illiterate adults or children who cannot properly operate machinery. Such employment practices can lead to a significant loss of product quality, reliability, and durability. You may have heard anecdotes on how fake goods fall apart quickly.

It may be funny if a fake designer bag falls apart during a gala. It’s definitely not funny if your power surge protector bursts into flames in the middle of the night.

Most alarming is that you don’t know what the knockoffs are made of. This is particularly a hazard when it comes to fake pharmaceuticals, be they fake Tylenol or Viagra. It’s one thing if the pills don’t work as they should; it’s another if unknown ingredients cause health hazards because they are poisonous or they interact negatively with other medications the patient takes. Extreme cases may lead to permanent liver failure, kidney damage, or death.

Fake perfumes are another serious health hazard. They can contain bacteria, urine, fecal matter, and antifreeze, just to name a few surprise ingredients. Unsafe ingredients may cause allergic reactions ranging from minor rashes to death. Knowing this, do you really want it sprayed on your body?

What about other fake consumer products, like jewellery, designer bags, and sunglasses? Surely they can’t hurt.

Wrong. The paint on fake jewellery and counterfeit designer bags may contain lead, which is particularly poisonous to children. Fake sunglasses may be tinted, but they often fail to protect your eyes from UV rays. With your pupil dilated under the shades,  you may be unknowingly frying your eyes simply by wearing a pair of knockoffs.

Last but not least among fakes to be concerned about are knockoff electronics. Besides the well-known failings that they don’t function well and are short on durability, the wiring may be faulty and become a fire hazard. Spontaneous combustion is not unheard of. Counterfeit rechargeable batteries, which may contain hazardous materials such as cadmium, are another serious concern. If the hazardous elements are exposed, they may endanger the health of you and your loved ones.

Think twice before buying counterfeit goods. The price may be tempting, but the real cost to your well-being may be astronomical.

PSWLaw Celebrates Small Business Week, Oct 17-23, 2010

This week, October 17–23, is Small Business Week. Held on the third week of October every year, Small Business Week was started by the Business Development Bank of Canada (BDC) 30 years ago. The week-long celebration has gained momentum in the past few years and gone mainstream. 

Trade organizations and financial institutions such as the Toronto Board of Trade and the Bank of Montreal are holding events and seminars marking Small Business Week. 

Here are a few events that may be of interest: 

Organized by the Bank of Montreal, Bay and College Branch (416-867-5190)

October 20 – Biz Week Fair 

Bank of Montreal, Bay and College 

763 Bay St. 

Organized by the Toronto Board of Trade (416-366-6811)

October 19 – Top of Toronto Networking Breakfast 

Islington Golf & Country Club 

7:30 am – 9 am 

October 21 – Technology Breakfast 

President & CEO of Ubisoft 

Toronto Board of Trade – Downtown Centre 

7:30 am – 9 am 

October 22 – Cash Management Toolkit Breakfast 

Toronto Board of Trade Downtown Centre 

7:30 am – 9 am 

The Canadian Institute for Chartered Accountants is presenting on these topics: 

  • Controlling and Optimizing Cash Flow
  • Building Blocks of Cash Management
  • Effective Budgeting
  • Analyze Sales Cycle

October 26 – Ian Troop – Pan Am Games – Limited seating left! 

Events on the Park – Leslie & Eglinton 

7:30 am – 9 am 

“How can your business get in the action?” 

Several trade organizations are organizing events.

Fraud Alert: Bad Cheques Scam 2.0

Fraudsters are becoming bolder. Today my colleague Adam Goodman received a cheque payable to him in the amount of $145,000 via mail with a brief note seeking legal assistance on a family law matter. The envelope had no return address. The only contact information was an email account and a foreign address. The sender asked Mr. Goodman to deposit the funds into his trust account and deduct his fees before wiring the remaining balance overseas.

Obviously, the cheque was fraudulent. Mr. Goodman contacted the supposed issuer, a local non-profit organization, and confirmed that it was bogus. The organization said that they had received several inquiries regarding such cheques and they had reported the incidents to the authorities. Apparently at least one attempt was made to cash the bad cheque.

Concerned, Mr. Goodman has forwarded the details of the incident to the lawyers’ insurance company, LAWPRO. A fraud advisory is expected to be issued shortly.

For further details, visit Mr. Goodman’s blog at www.aglawblog.ca.

Adam Goodman is a lawyer practising in North York, Ontario, Canada. Visit his website at www.aglaw.ca.

PSWLaw’s 2010 Green Initiatives

I’m pleased to announce that PSWLaw has adopted the following initiatives to better protect our environment in 2010:

Energy Conservation

  • Our central A/C shuts off at 6:00 pm on weekdays and remains off on weekends.
  • We use natural lighting in our corner office suite whenever possible.
  • We use CFL bulbs for artificial lighting.
  • Our PCs hibernate after 15 minutes of inactivity.

Reducing Paper Consumption

  • Our incoming fax messages are now printed double-sided.
  • Non-confidential single-sided documents are reused for internal purposes.
  • Reference materials are stored electronically where possible.
  • We have opted to receive the weekly Ontario Report electronically, saving approximately 4,000 pages of paper per year.
  • Invoices and correspondence to clients are sent electronically where possible.
  • The Often Cited Family Law Cases are no longer reproduced in the Book of Authorities; only the relevant extracts that we wish to rely on are attached.
  • We pay our bills online where possible.

Decreasing Carbon Footprint

  • For deliveries within the downtown core, we choose GreenTeam Courier, a Bullfrog powered company that facilitates all pick-ups and deliveries with a team of cyclists, walkers, and TTC Metro Pass couriers.
  • Our web-hosting company DreamHost is certified as carbon-neutral by an independent third party, The Green Office, through purchasing renewable energy and investing in Emission Reduction Credits.
  • Staff members are encouraged to take public transit for office-related errands whenever possible.

Making Environmentally Responsible Choices

  • 100% of our paper and stationery products are either FCS (Forest Stewardship Council) or SFI (Sustainable Forestry Initiative) certified, containing wood fibre from well-managed sources with a minimum 30% recycled contents.
  • 100% of waste paper is recycled, with confidential documents shredded.
  • We purchase refills for pens and tape dispensers.
  • We reuse moving boxes for future file storage.
  • Empty toner cartridges of our laser printer are returned to the manufacturer, Brother Canada.
  • Most cordless electronics run on rechargeable batteries.

Suggestions? Please leave your comments below.

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A Brief Note on the Health Professions Appeal and Review Board (HPARB)

The Health Professions Appeal and Review Board (HPARB) is an administrative tribunal established under the provincial Regulated Health Profession Act,* 1991, and the Ministry of Health and Long-Term Care Appeal and Review Boards Act, 1998.^ It has jurisdiction to conduct complaint and registration reviews and hearings. Self-regulated health professions in Ontario are subject to the oversight of the HPARB:

    Audiology and Speech-Language Pathology Medicine
    Chiropody Midwifery
    Chiropractic Nursing
    Dental Hygiene Occupational Therapy
    Dental Technology Opticianry
    Dentistry Optometry
    Denturism Pharmacy
    Dietetics Physiotherapy
    Massage Therapy Psychology
    Medical Laboratory Technology Registered Practical Nursing
    Medical Radiation Technology Respiratory Therapy
     
    Veterinary Medicine

While each of the the self-regulated professions above has its own college, the HPARB monitors the activities of the Colleges Complaints Committee and the Registration and Accreditation committees. For example, disputes regarding individual applicants’ admission to the profession may be appealed to the HPARB.

In addition to reviewing decisions made by the self-regulated health professions, the Board also has jurisdiction under the Public Hospitals Act# to review appointments or reappointments to the medical staff of a hospital, or grievances of members of a hospital medical staff relating to the revoking and/or suspending of their appointments.

The HPARB, like other administrative tribunals in Ontario, is independent of the government. The Board members are not allowed to have ever worked in a regulated health profession or college. read more…

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Collaborative Family Law Scam Hits Italy

Earlier I posted a few blogs on the collaborative family law scam (see e.g., “Collaborative Family Law Agreement Fraud Becomes More Convincing,” June 29, 2010.). It appears that this type of fraud has spread beyond North America and reached continental Europe.

I was contacted by a lawyer in Italy who told me in an email that she has recently received several inquiries to recover substantial sums of money from collaborative family law agreements executed in the U.S.

She became suspicious about the timing and the similarity among the inquiries and decided to investigate. She stumbled upon my postings and inquired into the frauds reported in Ontario.

I was able to refer her to LAWPro’s online resources. She is now convinced that the inquiries were bogus and is in the process of reporting the schemes to the local governing body.

Power to the internet!

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Be Wary of SEO “Guarantees”

Recently I have received several calls from search engine optimization (“SEO”) companies. They all claimed that for a small fee, they could guarantee that my website would show up on the first search-result page, or even within the top 5 positions.

Don’t be fooled. There are no SEO guarantees.

Google and other search engines utilize a complex set of rules and factors to determine the ranking of the sites shown on the result page. The factors and rules, while they can be approximated by industry experts, are jealously guarded as trade secrets.

Under these rules, different input keywords will lead to different results. For example, using the keywords “Toronto Family Law” and “Family Law Lawyer Toronto” will generate considerably different results. While it’s true that sites with high traffic volumes may appear under both inquiries, the rankings will likely differ.

The IP address of your computer may also be a factor. Local results are usually shown more prominently than foreign ones.

Most search engine companies like Google and Yahoo! know that the SEO industry is perpetually deducing its rules and factors. Therefore, the engines constantly change their factors and rules, perhaps by assigning different weight to different factors by introducing new ones and retiring old ones.

Hence, anyone who can “guarantee” that your site will rank within the first search-results page is unlikely to be able to keep their promises for long.

What are you going to do when they can no longer keep their promises? If the companies are located outside Ontario and have few or no assets here, you are likely left without any meaningful recourse.

Be wary of anyone who offers you SEO “guarantees.”

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Ontario’s “Eco Fee” Woes

July 1, 2010, marked the introduction of the Harmonized Sales Tax in Ontario. At the same time, Ontario consumers were slapped with another, less-publicized, charge, the new “eco fee.” Diligent consumers noticed an additional charge on their bill after purchasing certain goods, including batteries, soap, and shower cleaners.

The Ontario government insists that the new “eco fee” is neither a tax nor a mandatory charge. The additional amount appearing on the bill actually comes from the fees charged by Stewardship Ontario, an industry organization mandated by the government and regulated under the Waste Diversion Act, 2002* to safely recycle hazardous materials and divert waste from the landfill.

Under the law, Stewardship Ontario is entitled to charge fees to cover the cost of developing, implementing, and operating the waste diversion program and no more. In fact, Stewardship Ontario published the fees on their website <http://www.stewardshipontario.ca/sites/default/files/StewardFees.pdf>.

For example, Stewardship Ontario charges $0.06 to recycle or dispose of an aerosol can, while one litre of insect repellent costs $0.23 to recycle.

However, some retailers are evidently overcharging consumers. According to the Toronto Star, a consumer paid some $4.03 for her $10.00 one-litre drive way cleaner. Surely the cost of recycling or disposing can’t account over 40% of the product retail price?

After checking her receipt, the shopper went back to the store and asked about the fee. She was rewarded with an apology and a refund.

Although the eco fee is not calculated as a percentage of the retail price, nor there is a standard fee for specific products, amidst the confusion evidently some retailers are overcharging their customers. CTV reported that at least one retailer charged $0.13 on a bottle of supposedly environmental friendly cleaner, greatly exceeding what Stewardship Ontario charges the retailer.

There’s definitely a lack of clarity in the program.

Today the provincial government sent out a stern message to Stewardship Ontario. Environment Minister John Gerretsen expressed his “serious concerns” with the overcharging of fees and the availability of accurate information related to the program. The minister also threatened to eliminate Stewardship Ontario’s ability to charge eco fees all together.

Let’s hope that further confusion will be limited during this transition period.

If you have questions regarding the eco fees payable on certain products, inquire with your retailers or contact Stewardship Ontario at 416-323-0101 or toll-free at 1-888-288-3360 during business hours.

*S.O. 2002, c. 6

Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.

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The Tax Man Is Hiring

The tax man is hiring lawyers. While it’s hard to imagine a more socially awkward position, this job will probably help you avoid small talk on an airplane.

The federal Department of Justice has three vacancies open for crown tax litigation lawyer.

The salary ranges from $59,845 to $85,381. The suitable candidate must have successfully completed a LL.B., an LL.L., or a J.D. from a recognized university with at least one Canadian income tax course, and he or she must be entitled to practise law in Canada.

A written exam is required.

If you are interested in working for the tax man, you better hurry up! The position closes tonight at midnight.

For more information, go to jobs.gc.ca. The reference number is JUS10J-010588-000010.

Fraud Alert Update: Collaborative Family Law Agreement Fraud Becomes More Convincing

Two weeks ago I posted a blog on collaborative family law agreement scams. In that blog I noted a few red flags that may be indicative of a scam, such as the use of generic or universal terms in the initial contact message.

According to the latest bulletin from the Lawyer’s Professional Indemnity Company (LawPRO), the fraudsters are becoming more convincing.

For example, the fraudsters are now sending out personalized email messages with the lawyer’s first and last name at the beginning of the email. The fraudsters even send out follow-up emails inquiring whether the lawyer is willing to assist on the file.

Besides the apparent eagerness to retain the lawyer, the fraudsters are now able to provide colour scans of foreign IDs, including Chinese passports and U.S. driver’s licences. The fraudsters sometimes provide detailed background information and make phone calls that appear to be from local number by using spoof technologies.

In two instances the initial email was drafted to appear as if it were coming from a U.K. lawyer.

To make things worse, two Ontario lawyers who don’t practise family law thought that the emails were legitimate and passed them onto family law lawyers as referrals.

Here’s what LawPRO suggests to avoid becoming a victim of fraud: (emphasis is mine.)

Trust your instincts. If things don’t add up, ask more questions and dig deeper. Get the client on the phone and ask them to provide further background and explanation for anything that is inconsistent or that doesn’t make sense. Have them confirm details in the information they already provided to you and be especially wary if the client is hesitant or unclear on background facts. Don’t be naïve. In reply to our Alert last week, one lawyer said, “I’m relieved to hear you say that because I’m feeling sheepish for not having recognized that this was a scam from the get-go.”

If you have suspicions, carefully check and verify any background details provided to you. Ask for documentation from the client that will confirm details of any information provided to you. You can do a reverse lookup of phone numbers provided to you or that appear on call display; Google any addresses provided to you. Get the names of lawyers who previously acted for the client or ex-spouse, check online databases to verify they are real lawyers and ask for permission to contact them.

Ultimately, getting the retainer funds or payments from the ex-spouse irrevocably wired to your bank account is the only way to really protect yourself from this type of fraud. If these wires are coming from another Canadian financial institution, they should come via the Large Value Transaction System (“LVTS”).  If they are coming from a financial entity outside of Canada, the client or ex-spouse’s bank should make arrangements with your bank to wire the funds to your account.

As an alternative to getting funds wired into your account, tell your client that your firm’s policy is that all funds deposited by cheque or bank draft will be held for 30 days or until your firm is able to get confirmation that the funds have cleared.

Finally, you should terminate the retainer if you remain suspicious that the matter is a fraud.

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