My first full project at my first design job was a complete copy! I was instructed to take a device apart, measure everything, draw up all the parts, get quotes, etc. I was so nervous I went to the presidents office, and from somewhere had the courage to ask if this was legitimate? He assured me he had negotiated a license with the original German company to make, assemble and stock spare parts. Why don’t we just get their drawings? He said it was odd contract negotiation terms that the Germans wanted too much money. Weird. Anyway, I did it, and with our in-house manufacturing staff we changed some details.
At my own company we occasionally get this request, about 4 times in total. Taking a cue from my first job, when it is clear that the client is describing a desire to copy, I simply ask if they have a license from the original manufacturer and can they show it to me and failing that we simply refuse to do this work. So far 3 clients have just walked away, one tried a bit of bluff that he was negotiating a license.