Aqua Systems is caught in a noose. Whether employees with the Roslyn, N.Y.-based VAR tied the rope themselves by knowingly selling counterfeit goods is up to a New York circuit court to decide. QLogic says yes, and hopes to prove that the sale of fake host bus adapters by Aqua Systems was both intentional and damaging to the manufacturer's reputation, channel sales and bottom line. Aqua Systems claims it was duped right along with its customers, and accuses its own suppliers of being the real guilty parties.
Aqua's tale is not unusual. Counterfeit goods, both hardware and software, have infiltrated the channel, and solution providers that aren't careful could—knowingly or not—get burned. Peddling goods on the black market is big business. According to a report published by KPMG and the Alliance for Gray Market and Counterfeit Abatement (AGMA), the IT industry loses an estimated $100 billion annually to counterfeit products.