Chinese exhibitors hit with patent infringement papers at Summer Market

For a while, it appeared the only paper a number of Chinese exhibitors were going to be dealing with during Outdoor Retailer Summer Market was of the legal variety, not the buying kind. Both Cascade Designs and Petzl took aggressive, although slightly divergent, approaches in dealing with examples of alleged patent infringement by a number of Chinese companies.
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For a while, it appeared the only paper a number of Chinese exhibitors were going to be dealing with during Outdoor Retailer Summer Market was of the legal variety, not the buying kind.

Both Cascade Designs and Petzl took aggressive, although slightly divergent, approaches in dealing with examples of alleged patent infringement by a number of Chinese companies.

On Friday, Aug. 12, the legal paper began flying with a broadside by the Petzl legal team and Petzl America CEO Roody Rasmussen.

"We had a hunch we would find evidence of our patents being infringed upon at the show, so we were prepared," Rasmussen told SNEWS®.

So, one by one, the Petzl legal team confronted each alleged infringing exhibitor with notification that certain headlamps that were being sold infringed upon both a trademark (U.S. Trademark 2,901,135) and a design patent (U.S. Patent 477,680). Each of the following companies, United Industries, Ningbo Komaes Electrical Industry Company, Ningbo Free Trade Zone Import Export and C&A Import Export, agreed to remove the headlamps both from the booth and the catalogs. In addition, all four eventually signed settlement agreements acknowledging that the products each were selling infringed on Petzl's patent and trademark, although one initially refused until he was shown the error of his ways by VNU's Peter Devin, who convinced him his show may be over if he didn't. In addition, the signed settlement agreements stipulated that each company would immediately discontinue all activities "involving the making or selling or offering for sale of any headlamp having a design that would infringe on the '680 patent or '135 trademark." By signing the agreements, all four Chinese exhibitors avoided a lawsuit.

Daniel Wei Fang of United Industries must have wondered if the onslaught would ever stop though: On Saturday morning, Aug. 13, Cascade Designs' Jeff Bowman, accompanied by his legal team and a local constable, served more legal paper, this time a lawsuit, on Fang, as well as the head of the Chinese delegation, Zhang Hao Yuan of the Grand International Exhibition Co. LTD. The lawsuit informed them of products that were allegedly infringing MSR patents.  

"It was as if we hit a beehive with a stick," Bowman told us. "The offending manufacturer immediately took the MSR snowshoes off the wall (see photo to the right), apologized profusely and promised to send us a letter swearing never to knock our patented products off again. In the next breath, he asked if we would consider him as an OEM supplier."

Bowman added that within 30 seconds of leaving Fang's booth, the Chinese exhibitors were buzzing and a booth two stalls down began quickly pulling all of its product that Bowman told us "looked just like Therm-a-Rest pads and SealLine dry bags."

SNEWS® learned of other companies dealing with patent infringement issues at Summer Market as well, including CamelBak, Komperdell and Atlas-Tubbs.

The uproar by U.S.-based exhibitors was so great that Devin, VNU's group trade show director, told us he is exploring language changes to the current exhibitor contract with his legal team.

"I am talking to our legal department and exploring the possibility of adding language that states clearly that if you are found to have products in your booth that infringe upon another company's patent, we will pack up the booth and take it out of the show immediately," Devin told us.

That's welcome news to a number of exhibitors we spoke with, although there are those who, off the record, wondered why many of the Chinese companies are allowed to exhibit at any Outdoor Retailer show.

"They (the Chinese exhibitors) are only at the shows to line up OEM business anyway, and there are already plenty of trade shows that are designed for that purpose," one exhibitor told us.

Daniel Emerson, product development manager for K2 Snowshoes, told us his company is also dealing with alleged infringement: "We are aggressively reviewing our options against several companies, including one that is simply lifting both our designs and also our product description language.

"There are other things you can do that go well beyond simply slapping their wrists at a trade show, which is certainly a good start," Emerson said. "One way to go is locking up their shipments at the port. Companies can also go after stuff that has been in stores -- TSA sold a knockoff that was a direct copy of one of our patented bindings that was a direct import from China. TSA is a very important customer and even though they asserted they had no idea the product was a knock-off, we made it clear that selling the patent-infringing product was not an acceptable way to treat a business partner."
 
He added that all of this is a wakeup call for outdoor industry hardware companies, since until recently it has been the softgoods and clothing companies taking the brunt of the rip-off attempts.

Added Petzl's Roody Rasmussen, "The thing is, as a larger company, we can afford to do this and take on companies infringing on our patents. Little companies can't afford to do this, and they are the ones who are most often hurt. But beyond that, to me the real issue is, this stealing of products and ideas is stifling what makes this industry so great. It puts all of us in this same mode where we are fear mongering and hiding things…and that just kills innovation and creativity."

SNEWS® View: It's about time patent-infringing companies that think innovation-by-duplication is acceptable business got slapped and handed a huge slice of legally humble pie. We hope they choke on it. We have tired of watching Chinese "agents" blatantly photographing backpacks, tents, sleeping bags, stoves, clothing and more to take back to their computers for emailing to a factory ready to race the originator of a good idea to market. We've been witness to these so-called innovators going through tents at both OutDoor in Friedrichshafen and in Tent City at Outdoor Retailer with camera, notebooks and tape measures in hand. One of our compatriots watched, stunned, as a Chinese factory mole scanned, uploaded and then wirelessly emailed a recent sketch of a tent from his computer to, most likely, a factory in China. We applaud Cascade and Petzl for taking action and such a public stand at the recent Outdoor Retailer show. We applaud Peter Devin and Outdoor Retailer for taking the first steps to put teeth into exhibitor contracts. But much more must be done.

We loved hearing about Komperdell's solution to dealing with patent-infringing products at Germany's OutDoor show in July. Apparently, instead of serving legal papers, they served the Chinese company with a dose of several very large and muscular Austrians who physically removed the product from the booth. So much for diplomacy, but we would agree the time for talking has long since past. While we don't advocate getting physical, we certainly don't advocate trying to deal with these folks quietly. We need to make an example of each and every one of them. Perhaps, as their companies are publicized and pilloried in print, it might occur to them that ripping off someone else's ideas isn't thought of too highly in most countries.

We also join the voices of those who wonder how appropriate the product some of those Chinese companies is to the Outdoor Retailer crowd -- basketball hoops and remote-control golf carts don't exactly scream specialty outdoor to us after all. But maybe we're just bitter after literally being run down in the aisles by one cart, twice, after its owner lost control of it. Or perhaps they were just trying to take our editor out after getting wind we were going to print this story? Ahh, now we're getting paranoid.

And therein lies another, and most insidious evil behind all of this. Profiling. There is no way on earth that every Chinese person or company is engaged in ripping off another's ideas. In fact, we would bet just the opposite. The design ability, creative talent and energy in China are immense. But the trouble is -- and we admit being guilty of it ourselves recently -- the minute an Asian person walks into a booth, then spends a bit of time examining a product, it's likely folks begin to wonder if he or she is legit, or scoping out products for copying. An Asian friend of ours has felt this profiling pain, and he says it is no fun.

It is time to take stands, at least at our trade shows. No more profiling. No more toleration of products that infringe. No more toleration of those who would attempt to rip off products. If a person is caught with a camera taking photographs without permission, that camera should be taken away, images deleted (the beauty of digital!), and then returned to the offender while escorting his or her I'm-so-sorry self out the door -- banned from the trade show for life.

Do you have a strong view, pro or con, about Chinese exhibitors and copying product designs? Then sound off in the SNEWS® Forum -- a secure place that can only be read by those of us in the industry, and a place where you can say anything, as long as you are not simply flaming or nuking another person or company for personal reasons. Click on www.snewsnet.com/forums -- your Forum is now open for business.

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