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Fakin’ the Funk
The counterfeit sneaker game has exploded, spreading bootlegs from Hong Kong and China to all corners of the world. Complex takes you to the epicenter of the phenomenon, where authenticity is what you make it.
Complex, August 2007
Hong Kong’s Ladies Market, a bustling and stiflingly hot outdoor bazaar in the city’s Mong Kok neighborhood, is famous for two things, not counting sporadic outbreaks of avian flu. There are vendors who plunge tripe skewers into vats of bubbling oil, and there are bootleg goods. On a teeming side street, vendors manning stands of tent-like fabric flog all types of knockoffs, including sneakers. Many footwear stalls seem sourced from the same wholesaler; row after row of multi-hued pleather Bathing Ape fakes sit beside ViWans, ersatz Vans slip-ons that somehow look more authentic than other pairs of simple leather tennis shoes with the Vans logo embroidered on the side. Meanwhile, the most-sought brand in counterfeit sneakers, Nike, is M.I.A.
Spending time in Hong Kong, the odd pair of counterfeit Nikes—low-grade AF1 copies on a laborer’s feet, a hipster wannabe rocking fugazi Heineken Dunks in Kowloon—turns up. But among the high-end fashion cognoscenti on the peninsula, the practice is taboo enough to invite suggestion that it doesn’t even exist. “No one in Hong Kong would wear fakes,” sniffs the shopkeeper a Kowloon boutique selling $2000HK ($256USD) limited-edition Japanese New Balances.
Nonetheless, people from Hong Kong across the globe are copping more and more fake kicks, knowingly or not. While old bootlegging staples like bags and watches are still popular, sneakers are fast becoming a new favorite among counterfeiters. In late June, US federal agents completed a three-state investigation by seizing 950 shipments of copycat goods with a nine-figure street value—among which were multiple containers of fake Nikes.
In fact, other busts earlier this year began to expose a supply chain stretching from China throughout the U.S.. In April, Chicago police arrested a Nigerian national with 13,725 pairs of counterfeit Nikes; the man allegedly planned to distribute them to small retail stores. Retails level busts in July uncovered $2 million in fake Nikes, Lacoste, and Rocawear in Virginia, as well as thousands of pairs of fake Nikes in small boutiques and flea markets in and around Camden, New Jersey.
These shoes often follow a circuitous silk route through Africa or Mexico in order to throw off customs inspector. (In one case last fall, border agents seized 135,000 pairs of knock-off Nikes in Arizona. Paperwork had been altered to make the shoes’ destination appear to be Mexico, instead of the US.) Regardless of their path, though, shipments originating in China automatically raise eyebrows, and for good reason: According to Travis Johnson, associate general counsel of the International Anti Counterfeiting Coalition, a trade group, Chinese bootleg sneakers accounted for 81 percent of the $135 million counterfeit goods seized by US Customs in 2006—and a whopping $61 million of the $63.4 million in overall footwear seized. And though Hong Kong’s sneakerazzi dismiss fakes, Hong Kong imports accounts for an additional six percent of seizures; a number made less surprising by the fact that many Chinese shoe factories are owned by Hong Kongers.
Many of those factories are located in the Pearl River Delta, a border region that draws rural peasants to its vast factories. Workers often live onsite, logging long hours for a few dollars a day. But despite irresistibly low labor costs, China is rife with piracy. According to veteran sneaker design consultant Phillip Nutt, bootlegging originates in three distinct ways: deliberate excess production in legitimate factories; employee theft of trade secrets (and secretly manufacturing shoes on the same equipment used to make the authentics); and, increasingly, in sophisticated shadow factories that replicate shoes through reverse engineering. And with the manufacturing boom failing to lift most Chinese out of poverty, counterfeiting—which carries relatively light penalties—is a viable option. “It is tough [for bootleggers] to understand what the term ‘intellectual property’ means when they see Western tourists openly seeking their knockoffs,” Nutt says.
That demand is obvious in the gateway to the Pearl River Delta, Shenzhen, a former fishing village that’s grown from 100,000 residents to more than 10 million in less than 30 years. Shoppers from Hong Kong take a 45-minute train ride from their own city, walk a bridge over across the Shenzhen River, clear customs and enter the Luohu Commercial City, the Ground Zero of counterfeit retail. Rising around a massive concrete pedestrian plaza, Luohu is a five-story glass middle finger to American intellectual property laws.
Unlike Mong Kok, where vendors still go to the trouble of peeling back a bootleg Nautica label to reveal a bootleg Hugo Boss label, the Luohu vendors are more organized in their approach. The mall’s second floor features a glut of glass windowed sneaker shops showcasing Bathing Ape, DC and Puma knock-offs, with enterprising salesman gathered out front, trying to reel buyers in. But not everything is on display. Most stores keep a small photo album of their Nikes behind the counter, out of sight of the pesky investigators who frequently raid the mall. In one store geared to skaters, the Nike album includes Supreme Dunks for kids (a bargain at roughly $15 US), Danny Supa SBs and the relatively rare Deftones dunk.
At the Luohu Commerce Zhongli Shose [sic], a salesman named Li Qing Li (Ken for short) is ready to make a deal. A tall, slender man with hair dyed blonde and rocked Hong Kong hipster style (somewhere between Growing up Gotti and The Ramones), he hustles over to a customer, Nike book in hand. He can do a deal on a pair of 25th edition Air Force Ones and a pair of Year Of The Dog Air Force Ones, he explains. He grabs his calculator and punches in $620 HK, about $80 US. When the customer balks, Ken throws up his hands in mock exasperation. Special editions are special editions, Ken says. And from the relatively well-rendered copies, it’s possible for a moment to forget that Ken retrieved the shoes from a hidden compartment in the shop’s ceiling. It’s less possible, though, to ignore the packaging (an old orange Nike box poorly rigged to look like a new one) or the way Ken feigns keeping the $80 change with just a hint of menace.
Line Break
If bogus brick and mortar retailers like Ken seem brazen, his online counterparts are even less scared. You’ve seen the Google ads for “Jordan sneaker wholesalers” on sneaker sites like Nicekicks.com or Hypebeast.com promising Air Force Ones for $35. The sites themselves rail against the scourge of fake kicks, but rely on Google ad revenue to survive. Of course, to the bootleg sites’ customers who leave positive comments on the message boards thanking vendors for their $65 Bapes, it’s not always obvious that they’ve purchased fake shoes. “You're [sic] bathing ape prices are reeealllyy good,” raves Nicole from Virginia on gear-is-here.com, where Fapes run just $65. “I was on some other site the other day for bapes and they were like, $501100 dollars or some outrages [sic] price. plus, you have more selections.”
In the last three or four years, according to Scott Warren, a counterfeit investigator with risk consulting firm Kroll Worldwide, the bootleg market has moved toward better quality at a premium. “At 80% of the [retail] price,” he says, “people think they are getting the real thing.” Counterfeiters also achieve a further measure of credibility by maintaining a presence on eBay, even if price (i.e. $70 Bapestas) is a dead giveaway.
And it isn’t just retail. Cathy, a wholesaler with a China-based outfit called ebay-nike.com, which features lower-grade knock-offs, freely admits she peddles fakes. “The shoes is copy of nike,” she explained in broken English via an email exchange with a reporter. “The style is same as the original shoes, we have been sell many goods to France, UK, Italy and USA. Because is copy so the price more cheaper than Original shoes, the quality is also best.” She promises delivery of a pair in 5-7 workdays.
The vast majority of Cathy’s inventory is, of course, Nike. As this year’s busts have demonstrated, Phil Knight’s empire is the gold standard of bootlegging; counterfeiters know the swoosh brings the biggest payday. Questioned on the matter, Nike refused to comment, instead offering a boilerplate statement: “Nike does not disclose the amount of losses it suffers from counterfeiting or how much it spends to combat counterfeiting. Nike has a vast network of independent security officers and in-house personnel combating counterfeiting and trademark infringement.” In the Camden raid, for example, private firm Stumar Investigations worked alongside Camden police.
But Nike’s initiatives aren’t limited by geography. In July they took legal action against two Chinese manufacturers for using the Air Jordan Jumpman logo. The lawsuit doesn’t seem likely to stop offenders, though. As long as there’s a global market for almost-there replicas, Lin Qing Li, the indefatigable salesman from Luohu Commerce City, will be handing out business cards with #23’s silhouette.
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