Q: Can a patent owner request that i send them all of my products they consider to be a counterfeit?
i recently started selling pop up phone grips online, not thinking or researching if there was a patent. I got them cheap from a supplier on Alibaba and listed on Amazon. I have only been selling for a week now and popsocket, which is the brand name which owns the patent, has reported my listing as "property rights infringment". After researching this i immediately all of my active listings which had the same products just different designs/ colors. I have no intention of breaking any sort of laws and just want to start selling on Amazon to start a business. This was literally my first product launch. as part of the C&D Popsocket demands that: 1. I stop selling immediately. I have done this already 2. Send them any remaining inventory for proper disposal of counterfeit items. I am waiting on legal advice to decide how to proceed. 3. Provide an account of units sold. I haven't done this yet either.
Do i have to comply with all of these demands? I've sold $282 worth, can they sue me?
A:
I have seen a patent case that was awarded less than a dollar in damages as they wanted to make a point in a bigger set of battles.
As a practical matter, if you can show that you shipped them back to your supplier for a refund, then it is unlikely that they will chase you. We do not know whether they have similar patent rights in China or wherever your supplier is located.
If they have a design patent (number starts with a D) they can seek disgorgement of all profits you have made instead of just a royalty.
Unfortunately for a lawyer to carefully review their patent rights to see if what you have actually infringes, will cost much more than the $282. Best bet is to get your money back if you can and to report your sales and profits. You do not want them to think you are a bigger problem than you were and follow up with a lawsuit.
Next time, do at least some preliminary searching http://bit.ly/Patent_Searching. You can also look at the product you want to emulate. Usually a US patent for a product will be on the product. If not, you are likely to see patent pending which is your warning to look carefully. There is always a risk that a patent is pending on a product and you cannot find it, but it makes sense to look so you reduce the risk that something is out there that is a problem.
Hope this helps.
Kevin E Flynn
1 user found this answer helpful
A:
Mr. Flynn gave you some good advice already, but let me just chime in.
Although you are responsible for any product that you sell, it is pretty much impossible for any store that carries hundreds or thousands of products to perform a non-infringement opinion on each one. Each store would have to employ dozens of lawyers doing nothing but writing opinions costing the store many times the revenue. To mitigate this, most supply contracts have a clause in them that indemnify the retailer, so that the manufacturer would be on the hook rather than the retailer. This makes sense because the manufacturer most likely already did its PI due diligence.
Good luck with your business. It is not easy being an entrepreneur.
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