This has been a resounding theme for major foreign brand names and manufacturers sourcing from China, but small-medium size U.S. exporters to China are also learning the hard way that they need to take steps to protect their intellectual property or risk losing it to counterfeiters and outright thieves. ShippingDigest profiles the sad story of an adhesives company who was shocked to find a Chinese manufacturer happily selling near identical counterfeits at a fraction of the price:
It was only then that ABRO, a South Bend, Ind.-based exporter of quality adhesives, epoxies and fillers to developing countries, discovered that its products and its packaging — including the one with the photo of Katy Demarais on the label — had been counterfeited and offered at a fraction of ABRO prices.
“I really was stunned to see a booth, a Hunan Magic Booth, full of ABRO products,” Demarais said. “It had our epoxy, our super-glue, our gasket-maker. They literally had assumed our corporate identity.
“I noticed they had the actual photo of my wife in some of the paperwork,” he said. “And I asked them, ‘Who is this woman?’ And they said, ‘It’s just some Western model.’ I said: ‘Western model! This is my wife!’ ”
The boom in exports has been one of the silver lining’s of the U.S. economy and with the recent export boom, thanks to the weakened dollar, many small-medium sized exporters who probably did not do a lot of overseas business are not aware that their products, brands, and packaging are at risk if not properly protected:
And according to Hank Cox, a spokesman for the National Association of Manufacturers, the problem is made worse by the fact that most small businesses do not know there is a problem.
“Research conducted in the spring of 2005 by the U.S. Patent and Trademark Office indicates that only 15 percent of small businesses that do business overseas know that a U.S. patent or trademark provides protection only in the United States,” Cox said.
Our friends at ChinaLawBlog have been sounding the warning for quite some time about the importance of protecting your IP in China. I just sent off an e-mail to them to see if they had anything further to add in relation to this article, but in the meantime here are some links to some of their past posts regarding the importance of protecting your IP in China: