How to Survive a Copyca;er
Adidas and Payless. Mattel and MGA Entertainment.
Uber and Google. The history of IP disputes—and
subsequent lawsuits and settlements—is as long as
it is complicated. To avoid ending up in the annals
of famous IP battles, follow these tips.
Don’t Trust Anyone
Russ Tarleton, a partner at Seed
IP, a Seattle-based intellectual
property law firm, says that
when business owners start
out, many inadvertently put IP
in the public domain. Founders
should be careful not to share
their ideas with other people,
including friends and potential
partners, until they have consulted an IP attorney.
It’s important to make sure you
aren’t relying on just one
partner to make your product.
Once the Shirleys found out
that their manufacturer was
stealing their design for their
device mounts, they had to
scramble to find a different
one to keep fulfilling customer
orders. Now, they rely on
several manufacturers to make
the mounts, so if one doesn’t
come through, they will still be
able to meet production goals.
Catch a Thief
Without legal protection, it
can be difficult to prove that a
design was stolen, Tarleton
says. If IP is protected and a
copycatter is caught, your
lawyer can send them a
cease-and-desist letter. If the
scammer ignores it, their
behavior could be considered
“willful infringement,” resulting in their having to pay even
“When we examined our competitor’s online demo, we saw that the hands in the video belonged to a sales manager we’d been working with.”
distinctive ring he hadn’t even bothered to
RELINA: We felt totally betrayed, because the
three people involved in the scheme had been
working with us since the beginning and we
had trusted them with everything.
When we confronted them, we were pretty
emotional. We called them and said, “How dare
you do this to us after we’ve worked together to
start this business.” We had a lawyer send them
some scary documents and the website was
literally taken down later that day. We are just
thankful that they had signed an NDA and that
we had IP protection. Otherwise, I’m sure we
would have been out of business.
CHUCK: We had to scramble to find new manu-
facturers. Our business was so young that until
then we didn’t realize you couldn’t just rely on
one manufacturer to make everything for you.
Shifting our work to multiple manufacturers
was expensive and hurt our bottom line, but we
just had to do it.
The toughest lesson from the whole ordeal
was that a handshake isn’t worth anything
anymore. We’re really trusting people, and
we got taken advantage of. If we hadn’t done
the detective work, we would not be in
put food on the table for our kids, but it was
devastating, because making this work was
our dream. We felt like we had this million-dollar idea that we had worked really hard
on, and it was just slipping through our
fingers and we couldn’t do anything about
it. The other company had taken away our
golden ticket. We were so angry that all our
hard work would amount to nothing.
Then we noticed something weird: Our
competitor’s website was blocked on our home
computer but not on our phones. They clearly
knew our IP address, and they knew who we
were to the point of knowing where we lived.
But we didn’t know them.
Both of us were recruiters, so we decided to
do a little detective work using the tricks we
had learned in our day jobs.
CHUCK: We had Relina’s cousin, who lives in
Northern California and has a di;erent name
from ours, order one of the mounts from the
other company, and when it was delivered, she
sent us photos of the packing slip and return
address. The address turned out to be a UPS
box located just around the corner from our
We called UPS pretending that we were
trying to ship something to the address we
had discovered, and said we needed the box
holder’s name to make sure our shipment
would get to the right person. We learned
that the person attached to the address was
one of the manufacturers of our mounts—
someone we’d been working with since the
very beginning. Other things started to come
together: When we examined our competitor’s online demo of its product, we saw that
the hands in the video belonged to a sales
manager we’d been working with—he has a