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The trap, months in the planning, had been laid. The quarry, a beautiful Chinese businesswoman named Lily Wan, had taken the bait. The sting, code-named Operation Tiger Lily, a joint venture of Callaway Golf investigators and the Orange County, Florida sheriff's office, was about to take place. The site chosen for the meeting was symbolic of how brazen the sellers of counterfeit golf clubs had become. Of the major manufacturers, only Ping still makes most of its clubs in the U.S. The other big brands--Callaway, TaylorMade, Titleist, Cleveland, Nike, Adams, Cobra--make most of their clubheads in China, in an area just north of Hong Kong called the Pearl River Delta, where the combination of cheap skilled labor and technical expertise has created manufacturing's Perfect Storm. The Chinese produce golf clubs of consistently high quality at unbeatable costs. They are very good capitalists, creative and hardworking. But that same entrepreneurial spirit also creates other issues, according to Adams Golf chief executive Chip Brewer. Counterfeiting is so ingrained in the Chinese business culture that the perpetrators seldom feel they're doing anything wrong. They make and sell products--CDs, clothing, toys, electronics, golf clubs--more cheaply than the brand-name guys, offering consumers a comparable product at a lower cost. Workers flock there from poor farms in central China, providing cheap labor for manufacturers that have relocated to Dongguan from Hong Kong, Taiwan, Japan and the U.S. The bus passed miles and miles of factories, many operating 24 hours a day to satisfy the appetites of Western consumers. INSET: CAN YOU TELL THE DIFFERENCE?.

Offers Olympic sports news briefs. Difficulties for United States gymnasts at the world championships in Tianjin, China; Injury of US figure skater Paul Binnebose after a fall during a training session with partner Laura Handy. INSET: Heavy Mettle, by Brian Cazeneuve.