U.S. marshals raid Chinese aftermarket parts booths at SEMA

November 03, 2016 01:00 AM

The complaint includes evidence showing a depiction of defendant Unisun's product catalog and the alleged infringing products.

Editor's note: The source of a blog about the raid by federal marshals was misidentified in an earlier version of this story.

Federal marshals raided the booths of two Chinese companies at the annual Specialty Equipment Market Association convention in Las Vegas on Wednesday, seizing parts, displays and communications equipment after allegations of copyright infringement.

Additionally, the booths of six other Chinese aftermarket parts manufacturers were shut down later Wednesday at the nearby Automotive Aftermarket Products Expo, as part of the same investigation, authorities said.

The raids took place after a manufacturer of aftermarket Jeep parts, OMIX-ADA, of Suwanee, Ga., filed an emergency suit Tuesday in U.S. District Court in Nevada claiming that the Chinese companies were displaying and selling knock-offs of several of its patented aftermarket parts. Those parts included replacement hood latches, light mount assemblies and front grilles for the Jeep Wrangler. In its suit, OMIX-ADA claimed that the companies regularly sold knock-offs of its patented parts through online retailers such as eBay and Amazon.

District Judge Gloria Navarro issued a preliminary injunction and seizure order Tuesday. In court documents, the companies were identified as Changzhou Jiulong Auto Lamps Factory, Guangzhou Vcan Electronic Technology Co., Maxgrand Ltd., Sanmak Lighting Co., Shenzen Unisun Technology Co., and Unity 4wd Accessories Co. Navarro scheduled a preliminary hearing in her courtroom on the matter for Nov. 10.

OMIX bills itself as the “world’s largest independent manufacturer and wholesaler of Jeep parts and accessories.”

Henk Van Dongen, OMIX-ADA’s director of marketing, told Quadratec, a reseller of Omix products, that OMIX-ADA “talked with SEMA about how do we go through the steps because we don’t want to upset the industry at an event like this,” according to a Quadratec blog about the raid.

SEMA response

Peter MacGillivray, vice president of events for SEMA, said this morning that the issue of intellectual property protection was “very, very important to us. In this marketplace, at the SEMA show, we want to give our customers confidence that they can do business here without IP issues.”

The lawsuit said defendant Maxgrand's booth was

offering to sell patent-infringing products. Here is a picture of the booth that was used in the complaint.

There are about 2,400 exhibitors at this year’s SEMA show, and about the same number of exhibitors at the nearby Aftermarket Products Expo.

MacGillivray said that if the companies whose displays were seized “are found at fault, they will not be coming back to the SEMA show.”

Van Dongen said in the blog that the temporary injunction and seizure order OMIX-ADA won in federal court on Tuesday is not just about its product line and intellectual property. “It’s something that is industry-wide and something that has been building up and becoming more and more rampant over the past two to three years.”

In the blog, Van Dongen said OMIX-ADA was “willing to work with other companies in the Jeep aftermarket -- even ones normally considered competitors -- to eradicate these types of counterfeiters.” He said such counterfeit parts “are hard to catch in customs. “These individual pieces, there is no way to intercept them and it’s a major problem, so that’s what really started this."

Omix-ADA statement on raid at the Specialty Equipment Market Association show and Automotive Aftermarket Products Expo:

On Tuesday, November 2, the US Marshal’s office conducted a search and seizure of a variety of automotive aftermarket products as part of US District Court, Civil Complaint number 2:16-cv-02527-APG-CWH, due to claimed infringements Omix-ADA®‘s patents and trademarks on products sold under the Rugged Ridge® brand. Based upon showing that it was likely to succeed on the merits of its claims for patent and trademark infringement, the district court granted Omix-ADA a restraining order against the certain parts suppliers that led to the search and seizure.

The seizures took place at the Specialty Equipment Market Association (SEMA) show and Automotive Aftermarket Products Expo (AAPEX), taking place this week in Las Vegas. Omix-ADA worked hand-in-hand with show management teams to follow clear guidelines designed to help combat infringing product at the show, which was enhanced with the court order. Counterfeit product and copyright infringement is in direct violation of SEMA and AAPEX policies and the managing parties have taken appropriate action to remove violating exhibitors from the premises.

As a dedicated exhibitor, Omix-ADA would like to thank SEMA and AAPEX management for their help and cooperation in working with the company to help protect its patent and trademark rights, as well as the aftermarket customers. Omix-ADA is also pursuing litigation with several companies selling infringing product at various online retailers.

The company views counterfeiting and infringement as a serious and widespread problem in the aftermarket industry and one that can be combatted through proper legal channels, and would encourage other members of the aftermarket industry to follow a similar path.