Issue link: http://read.dmtmag.com/i/449927
I DA U N I V E R S A L J a n u a r y - Fe b r u a r y 2 0 1 5 11 LEGAL LINE Robert W. McIntyre IDA Association Legal Counsel Continued on page 52 W hy do people and compa- nies do what they do? ere are many reasons, but in our industry a growing trend is to create "monopolies by specifi ca- tion" and thus restrict access to products and services by legal manipulation. is process is o en subtle and can pose real minefi elds when researching and investigating new product lines. e situation is also impacted from the a ermarket side by the increasing number of "detail" patents being fi led by the OEMs and their Tier 1 suppliers. is trend also spills over into the a ermarket by way of the Tier 1 suppliers now becoming more active and competing with the rest of the world in key compo- nent and parts areas. Competi- tion is not inherently a bad thing. Indeed, eff orts of Tier 1 suppliers to increase the visibility and acceptance of quality replace- ment parts and components fl oat all boats in a growing world market…there should be room for everyone that can compete on quality and fair price. Unfortunately, with the growing complexity of machines and power units, and ever- tightening regulations, pressure is being applied to force the a ermarket to "certify" that parts substituted for OEM at the repair and rebuild level will guarantee the same regulatory performance as the OEM. is issue is compli- cated by increasing amounts of OEM "content" that is not from the OEM manufacturing plants, but more o en from the Tier 1 and below suppliers, delivered just in time for installation on the engine or tractor assembly line. Now the squeeze begins. e OEM tells the regulators that only the dealer-supplied OEM parts can meet, for example, emissions standards. e regula- tors – mostly lawyers or business types with no frame of refer- ence – trying to err on the side of caution, simply believe the OEMs when dra ing the regulations…. Liberal application of lobbying money also helps; everyone knows lobbyists "assist" the regulators in "understanding" complex issues. On the other side are the Tier 1 suppliers in the a ermarket, as well as the rest of the world, competing with the OEM dealers for the same customer opportunities. e Tier 1 a ermarket has to exercise caution when it seeks to "meet" the OEM performance levels to avoid a legal tiff with their OEM competitor-customer. is starts to get really nonsensical when, say, the same piston and liner kit goes into the engine at the OEM factory, the OEM parts box , and the box at the Tier 1 a ermarket level, and all are comprised of pieces and parts from Tier 1 plants in four countries. Leaving this tangle for a moment, the next issue is the patent minefi eld, and the mines are getting closer and closer together. Historically, the fundamental idea of a patent has been to give the hard working inventor a true reward for devel- oping something new and useful that would not only benefi t the inventor, but the public at large. is worked pretty well until about 1900 when technology exploded, and electricity, cars, trucks, planes, trains and ships started to rule the modern world. Even then, the concept of patents remained basically altruistic, as well as lucrative. George Westinghouse revolutionized railroads with his patented air brake system. Accidents and, importantly, deaths were reduced to a fraction of what they had been, and he made a justifi able fortune. Bell and Edison made fortunes for their companies, revolutionizing communications and manufac- turing. Brush was rewarded for lighting the streets, General Electric for applying power, and the world was a better place by their sweat and tears. However, on the other side, the system was beginning to be abused. Wilbur Wright obtained a patent on what he considered an entire airplane, but destroyed Wright Aviation and himself trying to enforce it. He spent the family fortune and his life on litigation instead of research and manufacturing, while his competitors built better and faster airplanes and won the market. Selden claimed sole rights to make the automobile as an entire device; Ford challenged him. Devilish Details