An arm of the U.S. government is now barring replica Nite Ize products from entering the country.
On Tuesday, the Boulder-based company announced that it has won a two-year battle before the International Trade Commission (ITC) in protecting one of its patented products against foreign companies infringing upon intellectual property rights.
At issue was the Steelie Ecosystem, a line launched in 2013 that features a unique ball-and-socket magnetic connection and creates a hands-free mobile device mount. The popular product—the first of its kind—was replicated and about 300 copies were listed online at lower, undercutting prices.
“Nite Ize has been working for years to find an effective way to protect our patents against unfair foreign trade,” Founder and CEO Rick Case said. “I am grateful to finally find justice supported by our United States International Trade Commission.”
Other companies also have been tied up in infringement cases. In 2017, KÜHL filed a lawsuit against L.L.Bean, claiming a Bean campaign featuring the phrase “Be an Outsider” infringed on KÜHL’s June 2015 trademark of the term “The Outsider.” And also last year, MIPS was granted a preliminary injunction in Germany to prevent an infringement by POC Sweden of one of MIPS’ patents.
But according to Nite Ize, it's uncommon for a company of their size to go to the ITC and win a general exclusion order essentially enforcing anyone—not just on a case-by-case basis—from infringing upon those patents. They want others to know it can be done.
In Nite Ize’s case, foreign manufacturers located primarily in China added to the problem. They shipped products directly to U.S. consumers through the largest digital marketplaces, such as Amazon, using a mailing service subsidized by the U.S. Postal Service called China Post for just over one dollar per package—a fraction of what domestic companies are charged to ship their own products to the United States, and even in the country.
Working closely with the National Association of Manufacturers, Nite Ize is lobbying to prevent foreign manufacturers from unfairly shipping knockoff products at greatly reduced costs through China Post.
Nite Ize said since no streamlined system or efficient legal proceeding exists to stop online marketplaces from listing knockoffs, and it is not realistic to sue hundreds of Chinese companies for infringement, the company turned to the ITC for relief.
The case started on Nov. 14, 2016, when Nite Ize and Robert Ziemian, a patent attorney at a national law firm, petitioned the ITC to investigate the case. They alleged violations by 32 Chinese companies based on imports and the sales of imports in the U.S. of mobile device holders and components that infringed upon multiple patents.
On Feb. 22, 2018, the ITC filed a final order with the U.S. government after a 60-day review period by President Donald Trump. The U.S. Customs and Border Protection Agency is now barring any import of infringing products and prompting online marketplaces to remove all Nite Ize Steelie knockoffs manufactured by 16 of the foreign infringers.
Nite Ize said it's advising customs agents how to identify a knockoff and the company plans to visit ports that have received high number of replicated products.
On Tuesday, Nite Ize submitted a request with Amazon that requires them to un-list the knockoff products from the website, and the company will be doing the same with other online marketplaces.
“With the growth of enormous digital marketplaces, intellectual property infringement by foreign entities is becoming a critical issue for product manufacturers in the U.S. and not many viable options remain,” said Clint Todd, Nite Ize's chief legal officer. “This general exclusion order will be a powerful tool in our fight to stop the wave of knockoffs from abroad. When shipments are confiscated at customs, manufacturers may think twice before copying our products.”