SylvanSport LLC Alleges Chinese Factory Ripped Off Its IP

 

Designed and manufactured entirely in the US, the SylvanSport GO is a lightweight, reconfigurable, camping and utility trailer that has been widely praised for its innovative design features. The GO “was copied down to the color scheme and even the marketing support materials,” said Tom Dempsey, founder and President of Sylvan Sport.

This is an unusually blatant example illustrating the increasing problem of many of China’s most accomplished companies achieving their success by pilfering the intellectual property of other industrialized nations.  In the case of SylvanSport – whose three original reconfigurable US travel trailer patents (566623, 566624 and 566625) were filed in 2007 (along with a subsequent PCT[i]) – a customer purchased a SylvanSport GO camper from the North Carolina factory in 2009, shipped the unit to Los Angeles and subsequently dispatched it from LA to mainland China, where it is now being manufactured by the Wuyi Tiandi Motion Apparatus Co., Ltd. The reverse-engineered “TDR Camper” is currently being offered on Alibaba.com – a Hangzhou, China-based retail Internet business (HKSE: 1688).

From counterfeit footwear, apparel and handbags to imitation pharmaceuticals, automotive and aviation components, and bogus Apple retail stores, China is the leading source of the world’s pirated goods.  During fiscal years 2004 through 2009, China accounted for about 77 percent of the aggregate value of goods seized in the United States, according to US Customs & Border Protection data. Hong Kong, India, and Taiwan followed China, accounting for 7, 2, and 1 percent of the seized value, respectively.” [GAO Intellectual Property – “Observations on Efforts to Quantify the Economic Effects of Counterfeit and Pirated Goods” – 05/2010]

China remains on the United States Trade Representative (USTR) Priority Watch List. The latter currently includes 12 US trading partners – China, Russia, Algeria, Argentina, Canada, Chile, India, Indonesia, Israel, Pakistan, Thailand, and Venezuela – who are deemed to be providing an inadequate “level of IPR protection or enforcement, or market access for persons relying on intellectual property protection.”

In 2008, an OECD report entitled “The Economic Impact of Counterfeiting and Piracy” conservatively suggested that “up to USD 200 billion of internationally traded products could have been counterfeit or pirated during 2005.” A figure that is larger than the national GDPs of some 150 economies. The report goes on to add that if this figure were to include counterfeit and pirated products that are produced and consumed domestically, and non-tangible pirated digital products being distributed via the Internet, the total magnitude of counterfeiting and piracy worldwide would increase by several hundred billion dollars per annum.

China does not recognize international patents; if a company does not file in China, it has no rights in China.

 

”Chinese companies like TDR Moto will therefore continue to leverage this considerable IP advantage to the detriment of their overseas competitors. Not only does this make a mockery of China’s “most favored nation” (MFN) trading status but it provides a strong disincentive to those American entrepreneurs who are contemplating bringing a new product to the market. The Chinese philosopher Lao Tzu once said that “the more laws and order are made prominent, the more thieves and robbers there will be.” Indeed.