Enforcement Economics
Quantifying the Value of Legal Wins
Emphasizing the financial return from enforcement action is useful, but not to the exclusion of other measures, as Ralph Cunningham discovers.
Numbers such as the value of counterfeit items seized, the amount of damages awarded against an infringer, or the number of successful prosecutions do not tell the whole story about effective IP enforcement, as delegates will hear on the panel, Enforcement Economics: Quantifying the Value of Legal Wins (Sunday, May 3, 1:00 pm–1:45 pm).
“The discussion will not focus on financial or economic returns only, as this is not a relevant metric in most jurisdictions,” says moderator Christopher Bailey, Principal and Head of UK and EU Enforcement, Rouse (UK). “It will be more focused on the return on investment of enforcement in a more holistic manner.”
Shelley Duggan, Senior Vice President & General Counsel at P&G Technical Centre Ltd (UK), John Flint, Director Global Brand Protection, Product Security Investigations & Enforcement and Customs at Kenvue (UK), and David Shepherd, Senior Lecturer, Economic Crime, School of Criminology and Criminal Justice at the University of Portsmouth (UK) will join Mr. Bailey to discuss how trademark enforcement can create measurable impact and internal value.
They will offer practical insights into quantifying success beyond litigation wins or products seized and refer to tools and frameworks to help intellectual property (IP) professionals articulate value in real terms.
"Evidence of impact may not be financial; it should be something objective, defensible, and measurable that shows what effect the expenditure is having."
- Christopher Bailey | Rouse (UK)
Calculations and Expectations
Some business executives want to see the possible return on investment (ROI) as a mathematical calculation before they put money into anticounterfeiting or increase what they are spending on it already, according to Mr. Shepherd.
“Others understand the purpose of anticounterfeiting and they understand that it is very difficult to calculate the accountant’s ROI—it’s very difficult to estimate the level and impact of, for example, lost sales, the impact on reputation, brand value, and quality perceptions,” he says.
“Nevertheless, they invest in anticounterfeiting because they see it as an investment in the security of the business.”
For the panelists, enforcement is only one part of brand protection, even if putting a value on what they get from it is important.
"In my experience, trademark enforcement resonates most with business colleagues when it is shown as a commercial enabler, not just a legal cost."
- Shelley Duggan | P&G (UK)
Demonstrating the ROI
Most organizations want to see a demonstration of the ROI of enforcement activities because IP and brand protection are competing for investment with all the other parts of a company, says Mr. Flint.
ROI can be a “blunt instrument.” IP owners should consider at least two other factors as well, Mr. Flint notes.
“First, enforcement is only part of a cycle of brand protection activities which includes detection, validation, and prevention. Together, these activities protect consumers and brand trust, and demonstrate longer-term value,” he adds.
“Second, financial impact obviously matters, but reducing risk, preventing harm, and maintaining confidence in our brands are outcomes that can have a deeper impact than short-term recovery.”
Enforcement as a Business Enabler
“In my experience, trademark enforcement resonates most with business colleagues when it is shown as a commercial enabler, not just a legal cost,” says Ms. Duggan.
“We usually measure trademark enforcement using practical indicators rather than exact figures. This would include asking what was stopped (such as counterfeit goods seized, online listings removed, or packaging changed), estimating loss avoided by keeping fakes or look‑alikes out of the market, and looking for behavior change, like repeat offenders disappearing after action has been taken,” Ms. Duggan adds.
"We view financial recovery as one outcome of effective enforcement, but not the definition of success."
- John Flint | Kenvue (UK)
Effective Action
The danger of an approach that says financial value is the only—or most important—measure of enforcement success is that it can overemphasize what is easiest to value and overlook actions that may be more effective in minimizing risk or maximizing consumer protection.
“The downside of a damages‑led approach is that it can undervalue prevention and intelligence‑led disruption, both areas where the most sustainable impact is often achieved,” says Mr. Flint. “We view financial recovery as one outcome of effective enforcement, but not the definition of success.”
Where to Start
Mr. Shepherd believes IP owners should start by clearly indentifying what they are trying to achieve when determining the ROI of enforcement.
“Perfection is the enemy of good. An accountant’s precision is impossible,” he says. “Collect data to build intelligence such that the data is good enough to make sensible judgments about strategy, direction, priorities, and methods.”
“Clearly set objectives—what does the business need to achieve and how. Then assess progress against those objectives.”
Activities such as takedowns and raids are not the same as outcomes, Mr. Bailey points out.
“It should be possible to come up with some evidence of impact,” he says. “This may not be financial; it should be something objective, defensible, and measurable that shows what effect the expenditure is having.”
