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Fighting knockoff designs

Feature Story

Marc Barnes, Staff Staff -- Casual Living, February 1, 2010

Walk around the corner at a home furnishings show in Chicago, Las Vegas or High Point. There, in a booth just ahead, is a chair, a table or a chaise lounge that looks strangely familiar. That's because it's your design, but it's not in your booth.

Steamed? You bet. And if you think that it's been happening more often over the past several years, then you'd be right.

The number of knockoffs has indeed increased in the recent past, according to registered patent attorney Jack Hicks, who has represented some of the biggest names in the casual furnishings industry as a managing member of the Greensboro, N.C., office of Womble Carlyle Sandridge and Rice.

The reason is the faltering economy.

“In tough economic times, companies cannot afford to take the risk in developing a new design and seeing if it will sell,” Hicks said. “The lower cost, safer alternative is to instead knock off a bestseller. That enables you to have a good indication of customer and hence, is a low-risk imitation.”

Similarly, the economy is also the reason that those who are knocked off are steamed about it.

“The downside of taking that easy way out is that you may well step on the shoes of the originator who has protected his new design through trademarks, copyrights or patents,” Hicks said. “During tough economic times, companies that do have a bestseller get very irate when one or two of their bestsellers are knocked off. They may say, 'We may not have as many sales as we would like so we would be darned if we are going to let our bestseller be knocked off.' ”

Hicks said the cases differ but the advice sought is similar.

“Their goal is that they need to be convinced, sometimes, that something can be done,” Hicks said. “And, if something can be done, what is the most cost-effective way to protect and police your designs?”

The biggest losers are the larger manufacturers, according to Joe Logan, executive director of the International Casual Furnishings Association.

“It really is a very challenging arena for our members and most of our members take it seriously,” Logan said. “The ones that are much more established and who put a lot of money into product development – they don't want to see their products (copied) – and they pursue the appropriate legal channels to have it stopped.”

Manufacturers react differently when their product lines are threatened. Dudley Flanders, president of Lloyd/Flanders, depends on the strength of the brand, especially among higher-end retailers.

“Dealers will refuse to buy knockoffs because they know that if they carry knockoffs, the real lines won't do business with them,” Flanders said. “We rely on the honesty and integrity of our dealers.”

Domus Ventures' strategy? Take 'em to court. Dave Hill, manager of North American operations, said Domus Ventures is likely the most knocked off casual furniture company in the world.

“So far, we have won 38 lawsuits on one item from 38 different manufacturers,” Hill said. “They were all cease-and-desist with damages. These are all OEM suppliers, companies in China and Europe that knock our products off and sell them to other distributors or importers.”

The item – a canopy lounge – has sold more than 70,000 copies for Domus Ventures since it was introduced three years ago, Hill said. And the copying continues – at the Chicago market this past September, he spotted two more copies.

“That will be number 39 and number 40,” Hill said. “The real crux of this thing is that the retailer needs to make sure if he is buying a unique piece or a unique group. He needs to make sure that whoever he is buying it from has the right to manufacture that item and get it in writing.”

Sometimes, it's the retailer that drives the copying. Rick Baker, national sales manager for Suncoast Furniture, said one retailer didn't want to continue buying from Suncoast when the price went up, so they decided to make their own. Suncoast sued and won an out-of-court settlement.

And Baker expects more copying is coming. At his company's Chicago showroom last September, people were taking pictures when they weren't supposed to be.

“They can turn a chair around in a couple of days,” Baker said. “You will see it in July in premarket, and by September they'll have it on the floor. You try to hide it as much as you can. We say here that we have one year to come out with new product and if it's a winner, it will show up somewhere else and we will be looking at court to collect from folks.”

David Swers said Sunbrella fabrics manufacturer Glen Raven has come up with a novel strategy: Outrun 'em, then make a better product.

“We introduce a new fabric and within a year, everybody has knocked it off,” Swers said. “What you do is you stay ahead and keep coming up with something new.”

Swers has also been known to do an on-the-spot demonstration with materials that look identical. The knockoffs can be torn in half after being in the weather for four months; Glen Raven's product won't tear after years of exposure.

“What the customer is buying is not just the design but the knowledge that the product is going to perform,” Swers said. “You don't get that with a knockoff.”

Charles Hessler, executive vice president of Barlow Tyrie, said his firm began registering its designs about 15 years ago – and backs up any threat to its designs with action.

“We go after them in the States as well as Great Britain,” said Hessler. “We do international design registration over there and we write letters that say (the knockoff designs) infringe on our design and if that doesn't stop it, we have our lawyers write the letters. The half-dozen times we have had to do it, we haven't had to go to court but we are prepared to take it to court.”

Sometimes, Hessler said, the copies are unintentionally funny. Barlow Tyrie's version of a sun lounger, which won a design award, had a retail price of $1,700 and included a strip of teak along the top of a rail, so that the metal wouldn't heat up in the sunshine and burn the user. The next year, a competitor came out with a version of it, but with the teak on the underside and a retail price of $799.

And sometimes, the copies are right in front of you – and are, in fact, your own product.

Mike McKeever, marketing and sales director of Les Jardins, said he spotted a lounger at a Las Vegas show that was identical to a lounger his firm designed and which had sold thousands of copies over the past three years.

The would-be sellers initially said they would remove the item if McKeever could show them paperwork proving that he had a patent on it. McKeever said he brought them proof; and still, it wasn't removed.

McKeever said he found out that a knockoff version of the same lounger was also on the Web site of a major American big-box retailer. McKeever said he told a buyer for the retailer that the design was exclusive to a certain supplier, but that he would welcome the opportunity to create different pieces that would be exclusive to the retailer – and invited him to a meeting. But the meeting never happened.

In both cases, McKeever said, lawyers' letters were sent and next steps are being considered.

“This really goes way beyond someone taking someone else's design and copying it and trying to sell it on their own,” McKeever said. “We have mortgages to pay and kids' tuition to pay and this has impacted us. We've been penalized by the unethical behavior of some of the people in our industry.”

What to do? Hicks, the patent attorney, said that there are two options that should be explored.

If a manufacturer believes beforehand that a new product introduction will sell well – and the producer believes it will be beneficial to market the product as “patent pending” – then investigate the available design or copyright protection before the show. Filing for an application with the U.S. Patent Office enables you to put up a sign saying that the product is “patent pending.”

Or, after the market, assess your bestsellers. That's what your competition will try to copy. Determine at that point if there are elements that can be protected, either through copyright or patent protection, under intellectual property laws, and then pursue them.

Hicks said that a copyright claimed even after a product is introduced will outrun even the quickest copycat. A design patent would be a close call but would hopefully catch them.

“Intellectual property laws exist in large part to reward companies who take a risk with new designs,” Hicks said. “And when you do hit a home run, it rewards them by giving them exclusivity.” 

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