1. Intellectual Property and Brand Protection
Jack Cameron, AAP
Vice President, Automotive Aftermarket Suppliers Association
Group Executive, MEMA Brand Protection Council

2. What is MEMA?
Motor & Equipment Manufacturers Association – founded 1904
Exclusively represents North American Manufacturers
Over 700 members
Three Market Segment Associations:
Automotive Aftermarket Suppliers Association (AASA)
Heavy Duty Manufacturers Association (HDMA)
Original Equipment Manufacturers Association (OESA)
Motor & Equipment Manufacturers Association is over 100 years old, founded in Collectively, MEMA represents over 700 manufacturing suppliers to the automotive and commercial vehicle markets.

4. MEMA Brand Protection Council
Formed in 2004
Represents all MEMA market segments
Approximately 35 member companies
Law enforcement members include:
Federal Bureau of Investigations (FBI)
Department of Justice (DOJ)
Royal Canadian Mounted Police (RCMP)
Liaison with other agencies include:
Customs and Border Protection (CBP)
Immigrations and Customs Enforcement (ICE)

5. Counterfeiting Statistics:
The automotive industry loses an estimated $12 Billion in revenue annually (75% from Asia) to service parts counterfeiters, $3 Billion in the U.S. alone.
Projected to grow to $45 Billion by 2011.
It is estimated that 250,000 automotive industry jobs are lost to counterfeit auto parts.
The International Anti-Counterfeiting Coalition puts revenue loss to U.S. Trademark holders at $200 Billion per year.
The International Chamber of Commerce estimates 7% of the world trade is in counterfeit goods worth $350 Billion.
More than 80% of goods seized at U.S. borders are produced in China. Other countries include Taiwan, Hong Kong, Russia, India, Pakistan and Uruguay.
An estimated 30% of products sold in mainland China are counterfeit.
Counterfeit parts constitute over 37% of the total automotive aftermarket in India.

6. Most Frequently Counterfeited
Oil filters, air filters, fuel filters
Disc brake pads
Brake Rotors
Spark plugs
Suspension parts
Belts and hoses
Windshields
Alloy Wheels
Head & tail lamps

7. Counterfeit windshields seized and destroyed in China
Counterfeit Product
Counterfeit windshields seized and destroyed in China

8. Seizure of brake pads in Shanghai
Counterfeit Product
Seizure of brake pads in Shanghai
GM “AC Delco” packaging
with Chrysler Group “Grand Cherokee” labeled parts

9. Seizure of brake pads in Kuwait
Counterfeit Product
Seizure of brake pads in Kuwait

10. Counterfeit Product Safety Issues: GENUINE COUNTERFEIT
No machining on the inside surface or bezel to ensure true fit to the rotor’s surface
Aluminum is substandard
Also noted: The counterfeit wheel is marked “USA” and “UAW,” neither of which Chrysler Group casts into this part and has a slightly tilted Chrysler Pentastar trademark.
The genuine wheel has the Pentastar (although not as visible due to the heavy use of the casting), location of origin and the supplier’s vendor code.
Source: DaimlerChrysler
COUNTERFEIT
GENUINE

11. Counterfeit Product The Pentastar’s internal lines are too thick
“Mopor” instead of “Mopar”
The silk screening on these fakes leaves the filter’s print smudged and hard to read
The boxes are made of inferior paper

12. Seizure of filters in China
Counterfeit Product
Seizure of filters in China

13. Counterfeit Product
Brake Valves
Fake
Genuine Bendix

14. Counterfeit Product Bearings Fake Genuine Timken
Incorrect font on logo and product
Fake
Genuine Timken

15. Counterfeit Product
Belt Tensioners

16. Counterfeit Product
Alternators
Genuine
Fake

17. Counterfeit Product
Starters
Genuine
Fake

18. Counterfeit Product
Adhesives
Fake
Genuine

19. MEMA Brand Protection Council Display
Counterfeit Product
MEMA Brand Protection Council Display

20. Other IP Violations Copyrights Trademarks Web Site Design
Advertising / Viral Marketing
Packaging
Catalogs and Price Sheets
Trademarks
Logos / Product Names
Part Numbers
Shape and Design of Packaging
Trade Dress

21. Guidelines To Protect IP
Registration – Register all copyrights and trademarks with the U.S. Patent and Trademark Office. Additionally, register with U.S. Customs and Border Protection.
License Agreement – Even when giving permission for customers to use IP on their own Web sites, it is important and helpful to have them sign a license agreement to avoid problems down the road. It also helps keep track of legitimate use versus infringement.
Terms of Use – Always add a "terms of use" clause to any cyber information (Web site, e-catalog, etc.) that must be accepted prior to any one having access to data, even if it is public. This helps defend and guard against possible misuse.
Redirect – When illegal or infringing sites are shut down, many companies having found it beneficial to redirect Internet surfers to the official site location.

22. Guidelines To Protect IP
Settlement – It is usually in companies' best interest to reach a settlement especially with small infringers. Settling minimizes costs yet still gains publicity for the plaintiff company, and establishes it as a business which pursues infringers.
Cease and Desist – This action is still the first step in contacting an infringer. More often than not, cease and desist orders produce results and saves expense of a law suit.
Evidence of Confusion – In these cases, infringers use legitimate brand names and part numbers as cross reference, and confuse or mislead buyers into thinking they are buying the genuine part. Proof of this is important in any legal action and usually obtained from the infringer's Web site.
Obtain Rights in Foreign Markets – Companies which register trademarks and copyrights only filed in the United States put their IP at risk in global markets.

23. Guidelines To Protect IP
Develop “Product Identification Training” Utilizing U.S. Custom & Border Protection Guidelines (handout)
Company Information
Registration and Recordation Information
Product Information
Manufacturing and Distribution Information
Violation Information
Disclaimer

24. MEMA Brand Protection Council
Quarterly meetings to share best practices and develop actionable solutions
Washington DC meetings with US agencies:
DOJ, CBP, ICE, FBI, NHTSA
Participation in law enforcement training conferences – booth, materials, interaction
Published white papers / Special Reports:
Direct Importing: Do Risks Outweigh Rewards – October 2007
Intellectual Property: Protecting Valuable Assets – January 2008
Protection of Part Numbers and E-Catalogs – January 2008
Distributor Liability on Counterfeit Parts – February 2008
Scams Prey on Corporate Goodwill – June 2008
Launched “member-only” web site

25. MEMA Brand Protection Council
Trade Show Anti-Counterfeit Activities
AAPEX Guidelines, Enforcement and Webinar
Announced cooperation with CLEPA and JAPIA (Trilateral)
Provided recommended guidelines to North American shows
Adopted by American Trucking Association trade show
Adopted by Mid-America Trucking show
Agreement by Truck World Show in Canada
Developed Counterfeit and Gray Market Flow Chart
For North American law enforcement training (requested by DOJ)
To be published as a Special Report (see attached slides)
Developed Position Paper on Brand Protection
Utilized in MEMA Legislative Summit Capitol Hill visits
To be expanded to Talking Points white paper
Developing MEMA member survey
Quantify size and expenditure of IP protection in our industry

26. AAPEX 2007 Patent Infringement Complaints: 5
Trademark and Copyright: 5
NHTSA Complaints: 22
All of the above lead to product removal and/or booth closures

27. AAPEX 2007
Confiscation of infringing products on show floor

28. MEMA BPC Initiatives Legitimate w/ Counterfeit and Gray Market
Original Equipment Channel
O.E. Vehicle
Manufacturer
O.E.
Dealer
Raw Material Or
Component
Domestic
Supplier
Domestic
Manufacturer
Distribution
Center
Warehouse
Distributor
Repair
Facility
End User /
Vehicle
Owner
MEMA Member Company
US Manufacturer
Parts Store /
Jobber /
Retail Chain
International
Supplier
Independent Aftermarket Channel
Legitimate
w/ Counterfeit
and Gray Market
Master Dist
/ Importer
of Record
Unauthorized
International
Supplier
Unauthorized
Manufacturer
Color Key:
= Raw Materials and/or Components
= MEMA Member Companies / US Mfgs
= Original Equipment Channel
= Independent Aftermarket Channel
= Steps in the legitimate Supply Chain
= Illegitimate Steps in Supply Chain
Internet
/ web site
/mail order
Will-Fit
Supplier
converted to counterfeit
Broker

29. MEMA BPC Initiatives O International Origin U.S. Destination Dubai
Free Trade
Zone
Freight
Consolidator
Customs
Broker
Customs
Broker
Freight
Consolidator
Purchaser
Dubai
Canada
Paraguay
Mexico
Panama
Shipments get “pinballed” around the world prior to final destination
Illustrative of Potential
Counterfeit and Gray Market

30. Government Affairs “Stop Counterfeiting in Manufactured Goods Act”
Signed into law by President Bush in 2005
Extends authority of federal seizures to include tooling, equipment and supplies used to produce counterfeit goods.
Makes it criminal to produce stickers, tags, boxes or other items used to traffic counterfeit products.
Expands definition of trafficking to include import and export of counterfeit goods and strengthens penalties.
United States Trade Representatives

31. Government Affairs “PRO-IP Bill” S. 3325
Signed into law by President Bush on October 13, 2009
Creates an Intellectual Property Enforcement Coordinator (IPEC) in Executive Office of the President to enforce Intellectual Property laws
Increases the resources available to federal and local law enforcement agencies to combat theft of intellectual property
Includes MEMA recommended GAO study on manufacturers rights
United States Trade Representatives

32. Government Affairs
“International IP Protection & Enforcement Act” S. 3464
Introduced Sept. 10 by Senators Baucus and Hatch
Requires US Trade Representative to spur countries that violate US IP rights and take specific steps to stop violators
Provides funds to increase USTR capability to improve enforcement
Did not pass this 2008 Congress but sets groundwork for similar legislation in 2009
United States Trade Representatives

33. International Efforts
Formed Trilateral with CLEPA and JAPIA
Agreement to adopt International standards on brand protection
Develop International trade show guidelines for IP protection
Initiated European Aftermarket Forum (EAF)
Turned over to CLEPA but remain a member
Developed product authentication initiative
Tec Identity – 2D barcode authentication standard in Europe
Initiated Brand Protection Guidelines with Automechanika
Contributed to show rules and regulations on IP
Participated Brand Protection trade show booth
Formed China Aftermarket Forum (CAF)
Introduced CLEPA / Tec Identity to the China Aftermarket Forum
Anti-counterfeiting booth at Shanghai Auto Show (participation in QBPC – Quality Brands Protection Committee)

34. International Efforts
Shanghai Auto Show

35. International Efforts
Automechanika - Frankfurt

36. Royal Canadian Mounted Police
Get Help
Royal Canadian Mounted Police

37. Get Help State and Local Law Enforcement
Privately Retained Legal Counsel
U.S. Customs and Border Protection (CBP)
Web site
Contact David Brener
U.S. Immigrations and Customs Enforcement (ICE)
Web site
Contact David Faulconer
Federal Bureau of Investigation (FBI)
Web site
Contact Kiffa Shirley
U.S. Department of Justice (DOJ)
Web site
Contact Matt Bassiur

38. Get Help U.S. Customs and Border Protection (CBP)
20 Field Operations Offices
327 Ports of Entry in the U.S.
15 Preclearance offices in Canada and Caribbean
U.S. Immigrations and Customs Enforcement (ICE)
26 Field Offices and Headquarters
150 Special Agents
Federal Bureau of Investigation (FBI) – Cyber Crime Unit
56 Field Offices
424 Special Agents
67 FBI-led Task Forces
U.S. Department of Justice (DOJ) – CC & IP Section
93 U.S. Attorney’s Offices (94 Districts)
25 Units – Computer Crime & Intellectual Property
230 Prosecutors - CCIP

39. Prosecutable Criminal IP Statutes
Criminal Copyright Infringement (17 USC § 506, 18 USC § 2319)
Criminal Trademark Infringement (18 USC § 2320)
Trade Secret Theft (18 USC §§ 1831, 1832)
Bootlegging (18 U.S.C. § 2319A)
Camcording (18 USC § 2319B)
Counterfeit Labels (18 U.S.C. § 2318)
Digital Millennium Copyright Act (17 USC §§ 1201, 1204)
NO Patent Criminal Law

40. Get Involved MEMA www.mema.org AASA www.aftermarketsuppliers.org
HDMA
OESA
MEMA Brand Protection Council

41. Questions?