Issue link: https://read.dmtmag.com/i/241540
LEGAL LINE Continued from page 11 or services in question be confused between, say, the Valuepart branch in Jackson, Mississippi and Puckett Cat? Not likely. Next, is there confusion between a company's overall identity, and possibly its packaging practices, and an OEM? This can take many forms. Let's say that a hypothetical company calls itself "CEP" and specializes in Cummins parts. Let's also say that this company publishes its information using the Cummins red and black style of web page and uses the same typeface as Cummins, the same part numbers, and the same engine descriptions: QSK and KTA. Maybe it even calls its parts operation "Fastserve," like the Cummins Quickserve parts website. This company makes its packaging look like Cummins packages and even uses Cummins part numbers, but avoids directly calling the products "Cummins." These are trade dress infringements and could be stopped in federal court if Cummins can prove that CEP's customers are deceived into believing that CEP parts are actually Cummins parts or are authorized or sponsored by Cummins. This kind of case can also spill over into the province of "unfair or deceptive trade practices," which covers a gamut of potential offenses: 1. False designation of "origin" of products or services, like the CEP examples, or use of packaging or websites so similar to the OEM as to make 56 consumers believe that they are getting genuine parts or services. 2. Not clearly disclosing the country of origin (as I wrote about last issue) on publications and packaging. 3. Use of the actual logos or trademarked names without a very plain and obvious disclaimer; disregarding in this "test" any possible trademark or copyright violations. 4. Making unsupported comparisons or suggesting OEM equivalency that again could cloud the consumer's understanding of the source and quality of the products or services. 5. Advertising used or even new gray market parts originally sourced from the OEM without clear identification of the source. This is especially important with regard to engine parts. In summary, this kind of situation can be very time consuming and costly if you are on the dirty end of the stick. In all fairness, the OEMs spend a lot of resources developing their brand and overall company identity, as do many IDA members. I can't imagine USCO, Valuepart, Black Cat or any other IDA member sitting still if someone knocked off their corporate/business identities. In short, it is not just copying the parts, which might be legal, but copying the "identity." In short, if someone on the Internet in Brazil thinks he is buying parts sourced from one of the aforementioned companies, but he is not – and he doesn't find out until he opens the boxes and finds poor quality parts instead of the real thing – that's a problem. This sort of situation also can be very costly if you are, even unwittingly, an "offender." The U.S. Federal Court remedies can include seizure and destruction of offending goods, restraining orders and injunctions, damages based on lost profits for the harmed party, damages to goodwill and "brand," treble damages for genuinely willful and harmful conduct, and of course, attorney fees. Also, in these types of cases, the "complaining" party usually has time to prepare, get organized and find a court that is convenient…the last could be a very costly surprise. For example, under U.S. law, a federal lawsuit can be filed wherever the offending products or services can be "bought," or even where the "harm" took place. This means that the potential claiming party can pick a federal court that is most convenient for them, politically and logistically…say ESCO in Portland, Hensley in Dallas, Valuepart in Chicago, and of course, Cat in Peoria. The process can also entail a "hearing" without either notice or chance to appear and defend. The well prepared and ready complaining party can, for example, convince the federal judge in the Western District of Oregon that "ESCO" will be permanently and irreparably harmed if something is not done instantly about some website or counterfeit goods sold by your company, even if there is no patent infringement or trademark infringement involved. Unfortunately, these sneak attacks are more and more prevalent today. But on the other side, the judges (like the one in my recent case) are far more skeptical than before and usually will not take drastic action without all hands on deck and a real hearing with witnesses and records conducted first. Also, don't bank on receiving a "cease and desist" letter or other warning to tip you off so that you can also make a "first strike" in your home court on grounds that you are innocent and the accusations in the letter are wrong or defective. This all comes down to a guessing game or plain business bluffing, but it all can be avoided by the development and legal protection of your own unique business identities, trademarks and copyrights. When you do use any competitor's or OEM's materials, make sure you clearly identify for "informational and comparative purposes only" and use every effort to distance your products from the competition and any possible confusion. Now, what do you do if you are hauled into the court? If you actually did mess up, admit it, and present a fair and reasonable correction plan. For example, neutrally notify the marketplace, discontinue use or re-write a potentially offending website, discontinue use of packaging after a reasonable use of "in stock," create a new package; basically, identify a reasonable solution to put before the court upfront to show that you are serious and fair. If the other side is overreaching and making unsupportable claims, get that on the record right away. Turn the tables by asking for expedited IDA UNIVERSAL January-February 2014