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Crocs Counterfeiters Face Long Prison Terms, Heavy Fines In China As Crackdown On Imitation Crocs Goods By Chinese Authorities Picks Up Steam

Crocs, Inc. (NASDAQ: CROX) today announced that Chinese courts have sentenced eighteen individuals to a total of more than 46 years in prison for producing and selling counterfeit Crocs goods. Seventeen individuals were convicted of counterfeiting, and two of the 17 also were convicted of offering bribes. An 18 th individual also was convicted on bribery charges in connection with production of counterfeit Crocs™ shoes. In addition to prison sentences, the above men together with another two face fines totaling RMB 2,832,500 (approximately $450,896). Nearly 128,752 pairs of counterfeit Crocs products valued at roughly RMB 60,000,000 (approximately $9,550,690) were seized as part of these recent investigations.

“If you attempt to produce or sell infringing Crocs products, we are going to find you and take definitive action to protect our intellectual property,” said Dan Hart, chief legal and administrative officer for Crocs. “The lengthy prison terms and heavy fines handed down in these cases show that Chinese authorities are very serious about assisting us to eradicate the production of counterfeit Crocs products in China, and so are we. We will not tolerate counterfeiters compromising our brand, and will continue to work with the authorities to hunt down and prosecute anyone who uses Crocs’ name, design or other intellectual property without permission.”

The cases were tried by the Shanghai Yangpu District Court and the Dongguan City No. 1 District Court. Decisions were made between March 13 and September 27, 2012.

“The sentences and fines associated with these cases are encouraging and reflect the vigor with which the authorities prosecuted these matters,” said Sara Hoverstock, Crocs regional general counsel for Asia. “As we continue to monitor and take action against counterfeit activity, we recognize the important role of the Chinese authorities and appreciate their support.”

Through September 2012, more than 600,000 pairs of counterfeit Crocs shoes have been confiscated through factory raids and customs seizures in China. This has resulted in 35 criminal actions, mainly in Guangdong, Shanghai and Fujiang Province.

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