Here’s a question that a business owner recently asked of me:
Would you be concerned about having products manufactured in other countries (China, S Korea) and then having the IP ripped off?
If you are concerned, you should listen to this discussion with John Eastwood at Eiger Law in Taipei from our podcast.
There is always a level of concern about having a third party infringe your own intellectual property, regardless of which part of the world your products are manufactured in.
That said, there is a greater worry when products are manufactured in far-off countries from the United States. The business benefits of having a product made in foreign countries are obvious – usually, it is much cheaper to have a product made in a foreign country and then imported to the United States.
If you are looking to have your product made in a foreign country, or are making your product in one, here are a few thoughts to help you protect your intellectual property.
- Register it all in the United States.
It seems so simple, but registration of your intellectual property in the United States is key. Do your due diligence – get a trademark search and opinion letter before filing to register the trademark. Register your copyrights. At the bare minimum, if the counterfeited material is being sold in the United States, you will be able to file a lawsuit in the USA and ask for actual damages (trademark and copyright infringement), treble damages (counterfeit trademark use), statutory damages (copyright law) and attorney’s fees (trademark and copyright infringement).
- Find those selling counterfeit items.
That may sound difficult, but if the counterfeit items were being sold on Amazon or eBay, then the receipts most likely have the name and address the items were sent from. From there, it is not hard for a private investigator to find the culprits and confirm alternative addresses.
- Ask for a permanent injunction from the importation of the counterfeit items.
As a part of damages in the lawsuit that you would eventually file, you must ask for a permanent injunction from the importation, sale, etc., of the items bearing your company’s trademark and identical to your company’s copyright.
- Give that injunction to CBP.
United States Customs and Border Patrol has a system for registering your trademarks and copyrights with them. CBP will help protect against counterfeited items. You can find more information here: http://www.stopfakes.gov/us-gov-agencies/cbp
- If applicable, also sue under the Consumer Product Safety Act.
While the Consumer Product Safety Act is mostly for federal government use, there is a private right for companies to file suit when the CPSA is violated. The times to allege a violation of this right are scarce, but if the consumer products are unsafe (or alleged to be unsafe), then it is a wonderful tool. The CPSA’s private right does require the plaintiff to send registered letters to all defendants, the Commission on Product Safety (in D.C.) and the state attorney general in the state the lawsuit is filed. There is a chance of several investigations happening if the violation is large enough.
- Get business help in the foreign country.
Effectively, you will need business help in the foreign country. Companies like UL help monitor factories in foreign countries when you cannot for human rights violations, counterfeiting, and product safety.
- Get legal help in the foreign country.
Find a local law firm in the foreign country where your companies’ products are made, register the trademarks and copyrights in those countries, and find out how to prosecute those who counterfeit in that country.