OCEAN CITY – Issues surrounding counterfeit merchandise were brought to the forefront at the City Council’s work session Tuesday as a review of the proposed ordinance for suspension and revocation of business licenses took place.
A new ordinance spelling out the suspension, revocation, and appeals process for business licenses came before the council Tuesday receiving a lot of support but also a lot of discussion on ways to strengthen the ordinance.
“We have waited a long, long time for this, I think this is a great ordinance, and I’d like to move it to Monday night,” Councilman Jim Hall said as he made a motion for a first reading of the ordinance at the next Council meeting.
Councilman Jay Hancock seconded the motion but also addressed issues he had with current circumstances.
“Do we have to wait for the T-shirt operator to be convicted of selling counterfeit merchandise for the city manager to revoke the license,” he asked. Guy Ayres, town attorney, responded saying that a conviction is required to revoke a license.
Hancock’s concern is that businesses are being reported for counterfeit items but not facing prosecution until months later if at all.
“The main point I’d like to see addressed in this ordinance is some way to shut down the places that knowingly sell counterfeit merchandise, basically defrauding all the people that buy that stuff,” Hancock said.
Ayres explained that the problem is that the police department does not have anyone qualified to make the judgment on counterfeit items and brand representatives or investigators must come down and testify that it is indeed a counterfeit item.
“The investigators are trained, they know how things are stitched, and they know what to look for,” he said.
Ayres also mentioned that, “anybody that goes in a store on the Boardwalk and buys a Gucci bag for $45 isn’t being defrauded.”
Hancock said that the items he is most concerned with are the counterfeit T-shirts, CD’s and DVD’s that are being sold.
Hall added his concern for T-shirts with profanity being displayed at the front of stores. Ayers explained the problem with addressing shirts with profanity lies in the first amendment rights. Still, Hall hopes that the threat of having to answer to the city manager will be a strong enough deterrent.
The council decided to change the language so that suspension could occur upon preponderance of evidence and not conviction.
The second issue addressed was the appeals process. As it stands businesses can appeal to the council after the decision of the city manager is made. Hancock would like to see the licenses revoked until the appeal before the council.
“Suppose on appeal the council decided he’s not guilty of it, then you’ve shut this guy down for 10 to 15 days in the middle of summer,” Ayres said.
Councilman Lloyd Martin pointed out that merchants may be unaware they are selling counterfeit items.
“He may not know it’s a knockoff and until you can prove that he did something knowingly we can’t take a license,” he said.
Ayres added, ““The people who are getting hurt the most out of all this is the honest merchant on the Boardwalk who has to compete with the guys selling the counterfeit stuff because the honest guy won’t do it.”
Hancock explained that he basically wants the ordinance to “have the power to make these people think about how they run their businesses.”
The council agreed the ordinance is a strong step in the right direction and voted unanimously to move it to Monday night’s council meeting for first reading.