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derekwong28
Joined: Dec 31, 2001
# Posts: 166
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Posted: 09/18/2003 08:45 am
Hi All
I am writing this as a warning to fellow practitioners of e-commerce. A couple of years ago, just barely two months after our business started, we received a message from a US lawyer. We were informed that a lawsuit had been filed against us by a US based multinational in a US court. This had occurred suddenly out of the blue without any warning. The US multinational alleged that we resold products from a Hong Kong company that had infringed that trademark logo. We were given no options to discuss this or negotiate a settlement. Although the design of the logos did bear some resemblance, it was far from certain whether the design was a deliberate infringement. The owner of the Hong Kong company told us that the logo was based on a ancient Chinese design. We were not that scared because the US multinational would have to fight their case in Hong Kong in order to get us. However, it was most unlikely they would do so because their case was very weak.
The lawyer for the US multinational then sent letters to our web hosters in the UK and the US demanding them to close our accounts which they did. As a result, we had to switch move our web hosting to Hong Kong. Our web hosting subsequently received a letter from the lawyer as well, but their position was that unless there is a court injunction against us in Hong Kong, they will not take action against our account. At the time, my wife was heavily pregnant and we decided that this was not our fight. Therefore we delisted all the products of the Hong Kong Company. Since then we have not had any more harassment.
This type of harassment by US multinationals on Hong Kong e-commerce companies is all too common. Here are some examples I know:
- A friend of ours sells toys on eBay. Their listings were closed down by eBay following a complaint by AOL-Time Warner that their toys infringed their copyright. My friend promptly contacted Time Warned and apologized, but were asked to reveal the sources of their products.
- Another friend of ours were asked by a manufacturer of FRS radios to advertise their products on his web site. The product is known as freetalker and is a radio based on a wristwatch design. Within a couple of weeks of posting, my friend received a letter from a US lawyer alleging that the product infringed their copyright and demanded that he removed the product from this web site. This he did promptly, partly because the product was unsaleable in the first place because it did not have FCC approval.
- the third case is much more serious and involved a Hong Kong company that sells video games accessories on the Internet. It was sued jointly by Microsoft, Sony and Nintendo for selling mod chips. Their case was that mod chips promoted games software piracy. As a result of this suit, their web site was closed down for over a month and they eventually sold it to another company. Surprisingly, they decided to fight this suit, partly because Sony failed to win a similar suit in Australia.
The problem facing us and other retailers is that it is virtually impossible to know which products we are selling may or may not infringe copyright. At least, after this experience, we have made contingency plans should we get into these problems again. Should we ever grow big enough, we will change into a limited company so that if we run into big legal problems, we can just pack the company in.
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excell
Staff
Joined: Mar 19, 2001
# Posts: 14504
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Posted: 09/18/2003 10:39 am
Thanks for sharing that, yes, it is most definately something to consider.
I am currently looking into the issue of promoting a local toy store and am wondering about logo/product/brand name usage and presentation.
I guess my best bet is to get them to apply for permissions.
What experiences have others come across when dealing with promoting brands such as disney, mattel etc?
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patrickh
Joined: Oct 05, 2001
# Posts: 2187
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Posted: 09/18/2003 02:58 pm
LikSang luckily sold much more than mod chips, so that definantly helped them bounce back because they could just take that one product line off their site and continue with a lot of orders. I used to purchase stuff from them, but heard that all incoming packages from LikSang to USA are subject to manual inspection by the post office, so I decided it was not worth the headache anymore.
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gal
Joined: Eons Ago
# Posts: 1148
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Posted: 09/22/2003 06:24 am
I sell vintage watches, many of which are tank watches. I was contacted by the NY attorneys for Cartier and told that I could not use the term "tank" as it was registered by Cartier. I strung them out for months with many back and forth letters to the attorneys. I figured that I would cease the use, but I wanted to cause them some pain also.
What a crock.
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derekwong28
Joined: Dec 31, 2001
# Posts: 166
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Posted: 09/29/2003 11:31 pm
Guess what, we received another lawyer's letter today form the US!?@X!
This is for another completely different matter. It claims that the PCNCIA devices we carry have infringed their copyright. According to their claims, basically all PC cards on the market, whether modems, LAN, or IEEE 1394 would infringe their copyright for "Smart Connector"
Actually this is a much easier matter to sort out, the brand we have been carrying is a licensee of that technology and therefore there was no infringement.
As we receive our products from a supplier, who receives the products from a supplier in Taiwan who receives the products from the manufacturer, just tell me how can we avoid something like this!
Do any of you make your supplier sign a declaration reviewed by lawyers to that to their knowledge, none of their products infringe any copyright before you carry them?
I really can't see how this sort of thing can be avoided unless you have a very large company which has huge negotiating power and has a team of lawyers
We are just lucky that we are not in the US.
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Frog
Joined: Dec 19, 2003
# Posts: 49
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Posted: 12/20/2003 06:36 pm
just add a smart connector is ®/TM/(c) said company to the bottom of any product pages, and you're safe :D, is the simple answer.
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debunked
Joined: Jan 22, 2004
# Posts: 97
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Posted: 02/11/2004 03:12 pm
for those of us who live in the US and sell legal products, you can sell new without hassle if you get them from the proper source: ie. distibutor or manufacturer.
Matel is very sue happy so don't try to sell even your old collection of hot wheels or barbie dolls online or you will get a wonderful letter from them.
If you are an authorized dealer of matels products, you then have the right to advertise within their guidlines.
If you buy a barbie made in hong kong and not from Mattel and try to sell it, expect legal action for selling stolen or copied items!
Same goes for anything copyrighted, TM'd or patented!
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