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Why Chinese Companies Need to Exercise Caution When Attending Trade Shows in the United States

December 20, 2016

Over the past two years, owners of U.S. patents have used Chinese companies' appearances at a trade show as a patent infringement "trap." These patent owners have commenced patent infringement cases against Chinese companies based on these companies' activities at the trade show. Importantly, these patent owners are not just commencing lawsuits, but, before the trade show even begins, they are obtaining temporary restraining orders enjoining the Chinese company from displaying, offering and accepting orders for the accused product at the trade show. In several cases, the temporary restraining order also contained a seizure order which enabled the patentee, with the assistance of U.S. marshals, to seize the accused product and all related marketing materials from the Chinese company's trade show booth. This practice appears to be particularly prevalent with respect to trade shows taking place in Nevada, including CES and the SupplySide West shows.

Not only do such seizures, which are carried out in public, severely hamper or eliminate the companies' ability to market their products at the trade show, they can be embarrassing and damage the reputations of the companies. Tarter Krinsky & Drogin is currently representing a Chinese nutraceutical company that was recently sued based on its planned appearance at a trade show in Nevada. That case, Aker Biomarine Antarctic, AS v. Luhua Biomarine (Shandong) Co., Ltd. and Infiniti Marketing Group, Inc. d/b/a Infiniti Nutraceuticals, Case No. 2:16–cv-2314 (D. Nev.), is being handled by the firm's Intellectual Property Group.

There are several ways Chinese companies can reduce the risk of being sued at a trade show in the United States. First, if before the trade show, the patentee puts the company on notice of its alleged infringement, the company should not ignore the notice. It should consult with a U.S. attorney regarding the best way to proceed. It may want to consider not displaying the accused product and related marketing material at the upcoming trade show. If the company is not put on notice, but believes that it will be displaying a potentially infringing product at a trade show, particularly one in Nevada, it should have the product evaluated by a U.S. attorney to determine whether the patent is problematic.

Finally, Chinese companies need to be cautious when sending product samples to the United States. Based on our experience, law firms and their investigators request samples of the accused product directly from Chinese companies and then conduct an infringement analysis on the samples. This can be done in several ways, such as emailing the Chinese company and requesting a sample, obtaining a sample at a trade show or by leaving a business card at the Chinese company's booth at a trade show. Before distributing a sample or sending a sample to the United States, the Chinese company should try to ascertain the purpose of the request.

By putting these precautions in place and consulting with U.S. lawyers who are well versed in this area of law, Chinese companies can reduce their risks of participating at U.S. trade shows and sending samples to the United States.

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Rosenberg, Mark J. Partner Partner 212.216.1127 VCard
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