California's Attorney General Kamala Harris has filed a lawsuit against two Indian and Chinese apparel companies for allegedly using pirated softwares in the production of their cloths for exports and to be sold in the state.
The lawsuits, filed in Los Angeles County Superior Court yesterday, charge Pratibha Syntex Ltd of India and Ningbo Beyond Home Textile Co Ltd and its sister companies, of China with violating California's Unfair Competition Law.
These companies did not pay licensing fees for software, including products manufactured by Adobe, Microsoft, Symantec and others, Harris, who is an Indian American, alleged in her lawsuit.
The complaints allege that the foreign apparel makers who have not paid software licensing fees have a significant cost advantage in the low-margin business of apparel manufacturing, shipment and sales.
"Companies across the globe should be on notice that they will be held accountable in California for stealing our intellectual property," Harris said.
"This is an anti-competitive practice which harms our state's economy and is illegal. These lawsuits go after overseas companies whose unlawful actions are eroding California's garment industry and placing California companies who legally pay for computer software at a disadvantage," she said in a statement.
A study by the Orange County Business Council said that California has lost nearly 400,000 manufacturing and technology jobs over the past decade to countries where piracy rates are as high as 80 per cent.
This activity has resulted in a loss of USD 1.6 billion in economic activity and USD 700 million in tax revenues for California, it said.