Aaron Conant  0:18

Happy Wednesday, everybody. My name is Aaron Conant. I'm the Co-Founder and Managing Director here at BWG Connect. We're a giant networking knowledge-sharing group for digital executives, I spend the majority of my time talking to organizations about their biggest pain points, strategies, networking, and knowledge-sharing across the board. And from those conversations, we get the topics or events that are most relevant. We're gonna do somewhere around 253 other webinars this year, we're going to do 100 in-person events, and we'd love to meet anybody in person if you're in a tier one city, or focus in the digital space and all really relevant. The other thing is, in these conversations were asked and also asked, you know, the brand's who's working for you and who's not. And that's how we get a shortlist of the experts that we bring into post and moderate these events with us. And so if anybody ever has any questions anywhere in the digital landscape, for a shortlist of hey, best providers on anything from Amazon, direct to consumer, obviously, brand control, international expansion, drop shipping, whatever it might be, don't hesitate to shoot me an email, aaron@bwgconnect.com. That's what I spend the majority of my days doing helping people with partner selection. housekeeping items, we started this three to four minutes after the hour. And just so everybody knows, we're going to wrap up at least three to four minutes ago as well. And give you plenty time to get your next meeting without being late. And I think with that we'll kind of jump into the topic today new ways to protect your brand through IP and design patents. So this is just an interesting topic. You know, we got connected with the team over at Vorys eControl, probably six years ago now. Because brands had a major issue around protecting their brand. And it's only grown, I would have thought after six years, we'd started to tackle it. And while we have it keeps evolving, like anything else. And so it's gotten harder and harder. And so we do a lot with the team here for Easter, great partners, supporters, the network across the board. And so thanks to you guys for jumping on and sharing today. But Martha if you wanna do a brief intro and Vorys eControl. And yourself, that would be awesome. And then you can kick it to Emma and Aaron for their intros as well. And then we'll kind of starting the conversation; sound good?

Martha Brewer Motley  2:44

Yeah, sounds like a plan. Well, thanks, everyone for joining. My name is Martha Motley. I am in the Columbus office of the Vorys law firm. We are a firm that was started in 1909. So we are a full-service law firm. And we happen to have this really cool eControl practice in addition to being full service. So I manage our litigation specific to our eControl clients. And I have the pleasure of working with Emma. Emma, do you want to introduce yourself?

Emma Morehart  3:13

Yes. Hi. Thanks, Martha. Emma Morehart. I'm an associate, I focus on our eControl litigation. I've been doing exclusively eControl litigation for about five years now in our Cincinnati office.

Aaron Williams  3:31

I'm Aaron Williams. I'm a partner with the Vorys law firm here in our Cleveland office. I do all forms of intellectual property litigation. So work with our eControl team, as well as handle traditional trademark, patent trade secret trade dress cases, all across the United States.

Aaron Conant  3:52

Awesome. So a quick reminder, we always like to beat these to be as educational information as possible. So at any point in time, if you have questions, drop them real time into the chat, or into the Q&A. Or you can always email me aaron@bwgconnect.com. And we'll be sure to get those answered pretty much real time if we can. So you've dropped questions as we go. Yeah, let's jump into it. Like super cool topic. So let's jump in.

Martha Brewer Motley  4:19

Yeah, definitely. All right. So Emma is driving our slides for us today. So Emma, next please. Okay, so high level, just a couple of thoughts about our eControl program, because a lot of folks haven't heard about eControl. And candidly, eControl is a word that we made up so I would fully understand if you did not know what this eControl thing is all about just sort of high level. It's a comprehensive solution. That's intended to help remove an authorized seller from the platforms to assist with map compliance in the US and Canada to help control and grow online marketplace sales to stop product diversion. and to eliminate channel conflict. And we do that through a series of sort of legal policies and strategies that we combined with our built our business knowledge to make sure that we have sort of this full front-to-back solutions so that we can help brands go after the bad guys who are impacting their profitability. And more importantly, and perhaps most importantly, making sure that consumers have a great consumer experience and so that the brand's reputation is well protected on the internet. So that's kind of high level, what we do, we represent a ton of brands, if you were to open your medicine cabinet, we represent them, if you open up your garage, we represent them, anything that you eat, touch, put on your skin, like comb through your hair, and probably represent them too. So a lot of brands a lot of good experience a lot of good cross, sort of cross-market experience. And it's not just Amazon, it's eBay. It's the next one and the next one and whatever the next great one is, I'm sure we're going to be dealing with that too. We have a massive center down in our Cincinnati office that helps us send out enforcement letters. So we've sent out over 60,000. And I honestly think that that number is quite low, I think it's significantly higher. So it's a it's a big machine. And we are part of that machine. And we are specifically the litigation piece of that. So Emma, if you'll slip to the next slide, please. So we are talking about litigation strategy here today, I took a peek at our guest list. And that looks like most folks are nonlawyers. So we're going to try to cool it on the legal jargon. If I start to get too jargony, or you don't understand what I'm saying, or Mr. Arun, please just pop us a note because we do tend to slip back into those legal terms and phrases that can be nearly incomprehensible. So we're going to try to talk about this in sort of high-level regular terms. There are certain things that we would love to answer, but we can't because we do have certain ethical obligations to not divulge client information, which I'm sure those of you who are clients very much appreciate. So we're looking at this umbrella. And underneath this umbrella is all of the litigation that we handle. So primarily, what Emma and I are dealing with on a day-to-day basis would be this little light blue box. That is the unauthorized seller lawsuits. So this would be the folks who are on Amazon or eBay, who are simply not authorized to sell your products. We have initiated something like 300 litigations, I think I'm up against folks who are in pretty much every jurisdiction where you can file a federal lawsuit. Okay. So that's one piece of it. We're not talking about that today. We also manage ATA website, compliance litigation. So those are you've probably all gotten predatory letters from folks who say, Hey, your website isn't reader-friendly, doesn't have the appropriate ereader set up so that folks who are visually impaired can access it, we handle those two. What I want to talk about today is a sort of a flip on how you generally think about litigation. I think when you go to brands, and you talk about litigating, they're thinking about it being on the defensive side. Right. So what happens when somebody sues the brand? And we do a lot of that defense work. But you know, again, that's not what we're talking about today, we're not talking about you are in the crosshairs of a predatory plaintiff's counsel, what we're talking about is a way that we can make litigation, less risky, costs cost-effective, and very successful in terms of protecting your brands online. And specifically, we'll be talking about counterfeit litigation. And Emma will talk about that. And then Aaron will talk about trademark and patent lawsuits. So it requires us all to flip our thinking just a little bit and cross over to the other side and think about what it is like to be the one who's actually going into the litigation willingly, as opposed to what we sometimes see on the defensive side, which is people have been dragged and kicking and screaming, Emma to the next slide, please.

Aaron Conant  8:57

We really quick on the ADA side. If they get hit with letters, they just email you like.

Martha Brewer Motley  9:04

Yeah, yes, you can email me I can get that to the right person. We have a gentleman on our team who deals with these folks stay and when he gets hit with it right now. And it's you know, it's really offensive because those laws are good and important, and have an important purpose. And they've just been so twisted, so that these plaintiff's counsel go out, and really what they want is a settlement. And you know, the settlements are between 10 to 50 to 100, depending on who the plaintiff's counsel is, um, you know, we know all these guys, and it's, you know, really as predatory so yes, if you get one of those letters, don't panic, just call us. Thank you, Aaron, for that. Yeah. So we're talking about what to do when you want to file a lawsuit and we're going to talk about the strategy here and to sort of set the table the scenario that you would be dealing with would be either a true counterfeiter, where you have reason to believe that someone is online, and they're selling a product that is a non genuine product, that it hasn't come out of the appropriate manufacturing facility. It hasn't been made in your according to your specifications, it is not simply unauthorized or intended for Europe or Latin term, it's actually a counterfeit product. So that's sort of one bucket that Emma will talk about. And then the other bucket that Aaron will talk about is when you see somebody online, who's basically knocking off your IP. So it's kind of a knockoff would be the way I think most people would think about it. And what I'm going to talk about is the strategy that generally applies to both of these scenarios. And Emma and Aaron can talk about the slight differences. So what we want to do first, and we know this, because we sometimes get pulled in after the fact when folks have hired someone else. And when we get asked to come in and help, you know, clean up some of that mess, or we get brought in once a brand has gotten halfway down the path and realizes Gosh, I'm not really sure what to do and what order so we want to, we want to head that off the past, we want to make sure that we're coming into these, both scenarios, both this true counterfeit, and this design infringement arena, we want to make sure we're coming in with a plan. Okay, so we want to work with the brand to engage in strategic test buys to set a baseline for the genuine product, or what the what the challenges are between the genuine product and the knockoff product, right. So we want to make sure that we are being very organized, in terms of who is doing the product buys, where are they physically located? Where are they requiring the product buys to go? Because once we get down the road, we may want to have made product buys into certain states to help us with that litigation. So again, trying to stay away from legal jargon. But there's a legal concept called personal jurisdiction, which is where the court looks and they say, Hey, is it fair for this defendant, this bad guy to be sued in this state? What's their connection to this state? And one of the ways that you can ensure that that is appropriate as by doing test buys into that state? So we'll work with the team to make sure we understand, where's everyone located? And where do we need to be doing the test wise? We also see a lot of scattershot test buys across the enterprise where folks are not carefully organizing, who has done what, what's the order number? What was the result? Where did it come from, when when when was it received, we need all of our ducks to be in a row. We've seen it go really, really well and have recommendations on that. We've seen it go really, really poorly and have recommendations on how to avoid that. We can also assist the brand and identifying what the counterfeit is and explaining in a comprehensible, but also legally defensible way? What are the differences? So on the one hand, we want to make sure that we're giving the appropriate entities enough information to know, how do we know this is counterfeit? How do we know this is a knockoff? Contrasted with, we want to make sure we're not giving the bad guys so much information that they know haha, the key here is that Singapore has been spelled incorrectly, and I'm going to fix that I'm gonna go forward. Or the key here is that the strike marks or the mood or injection marks are not in the appropriate spot. And I'm going to fix that on a go forward. So part of our investigation plan is getting all of those pieces together, so that we know the who, what, when where, and can explain that to the appropriate entity, whether it's Amazon or the court in a way that is clear, cohesive, makes sense and doesn't spell all of our secrets here.

Aaron Conant  13:38

I mean, it's also, you know, from the claiming counterfeit, this is another reason not to do it right away, right? Because I know, you know, in some instances, a brand goes out and claims Hey, it's counterfeit, and then they find out it's not. And then if Amazon is shut down that storefront then that seller comes back, right for claims on lost profits. Yeah, but here's an here's another reason not to do that. And I don't know if you want to expand on that a little bit, because you guys have probably dealt with it. You know, I hear it from brands and how it got really went sideways. But this is another reason not to do it because you're going to ruin your potential test bias. Right?

Martha Brewer Motley  13:39

Yes, 10,000,000%. To all of that. I'll let me talk a little bit more about what we've seen in terms of those litigations. But yes, it is real, it's scary. I was just dealing with one yesterday, and I think I have another one popping up where somebody who was well intentioned at the brand made a counterfeit complaint, and it turns out, wasn't counterfeit. And turns out Amazon actually does care about whether something's counterfeit. And that can create all sorts of bad issues. So yes, Aaron, you're absolutely right. Those are significant risks.

Aaron Conant  14:54

Yeah. Does that mean that was the common thing right? Oh, just claim counterfeiting. They'll shut it down.

Martha Brewer Motley  14:59

Yes. Please don't do that. Don't do that. If there's one thing you take away from this, please don't do that. Please don't just yell counterfeit into the void because although Amazon and the other platforms as well do feel a lot like screaming into the void, you know, they sometimes hear little words here and there and counterfeit is one that they do here. Awesome. All right, if anyone has questions about any of this again, pop into the chat. And happy to answer as we go.

Aaron Conant  15:26

Yeah, just one right now about a GS one certificate due to a company name change, but maybe we can tackle that one towards the end or there's a follow up.

Martha Brewer Motley  15:34

I think we can probably tackle that towards that sounds like an Aaron question. Yeah, Emma, maybe the next slide. Okay, so to orient us in space and time, we have done all of our initial steps, where we have done our test buys, we have confirmed we have validated, it is truly a knockoff or a counterfeit. They have our ducks in a row. Everything's organized, it looks beautiful. We're ready. We're ready to go. We're ready for litigation. Okay, so what does litigation look like? It looks like who, what, when, where? Okay, so who are we going to sue, we want to make sure that we have identified the appropriate person I've seen person or entity. I've seen far too many litigations where the well meaning but perhaps uninformed lawyer will initiate a lawsuit against the entity or the person who is listed on the Amazon storefront, when in reality, we know that those are not scrupulously accurate. And sometimes they are intentionally misleading, I could probably do a full webinar on the scenarios where we've seen fake falsified fraudulent information listed on Amazon. So it's all well and good to do your test buys. But when it comes to filing the litigation, you don't know who you're suing, or you're suing the wrong entity, it's really going to slow things down. And the court will sometimes let you depending on the timing, update your case. But sometimes you've got to ask the court for special permission to do that, depending on where you are in the sequence. So it's really important that we do that work at the front end, to make sure that we know who these entities are. And they're tricky, and they hide and they hide under rocks. And we know where those rocks are. And we know how to get the snakes to come out from underneath the rocks, so to speak. We have a very robust team, one particular investigator who can find anyone, I offer her services for litigation, as well as ex boyfriend reconnaissance. So she can really do it all. She knows how to find people. And she knows how to find where they're physically located, so that we can make sure that we're getting the right people pulled in the first time because we don't want to have to do it more than once. So then this is sort of the scary part that brands kind of hold their breath and say, Are we really doing this? Yes, we're really doing this, it feels scary. It's not that scary. We're going to file a complaint. And we're going to seek a temporary restraining order. I'm delving into legal jargon a little bit, but bear with me for a second. So the complaint that most of you know is just the written legal papers where the law firm sets out, here's what has happened. And here's why it's bad. We put it into legal jargon. And then we try to make it easy for you to read by just calling out what we need you to validate the temporary restraining order. So we do this on kind of a secret basis. It's called ex parte, which means we can go to the court before we let the bad guys know what we're doing. And the element of surprise is key here. Because we don't want them to find out, hey, we know who you are, we're on to you. And then what do they do? Of course, they just create a new storefront. And they move their things over. And they go on, and we have to do another test by and we have to do another validation process. And then they get wind of it. And then they move on to the next storefront. We want to avoid that. So there's a process called ex parte, which means without the other party's involvement, where we can ask the court Hey, Your Honor, you need to let us do this complaint secretly for right now, because we don't want to tip off the bad guys so that they do these things in response, like move their assets, move their product out of FBA, shipped over to another storefront. Now, at some point, we will have to let them know about the litigation. But we need the element of surprise. And we need the court to grant that temporary restraining order, which only lasts for a couple of weeks or a couple of months at the most so that we can take that court order and take it to Amazon and say hey, Amazon, the court has said as a preliminary matter, we are right. We've given the court enough information to think that we're going to win this and you need to freeze everything. You need to just put everything on hold. It's not an adverse event against the brand at this point. I'm sorry against the bad guys at this point. It's just holding everything. It's like pushing the pause button so that they can't move their assets out of Amazon and they can't move their inventory out of FBA. And by Doing that we put the pressure on the bad guys, because now their assets are frozen and their inventory and FBA is frozen. And they don't have the ability at this point to shift it over to another storefront, requiring us to start the whole process all over again. So the LMA.

Aaron Conant  20:16

Amazon is is cool with this? Or I mean, do they have to get one more than one of those obligation things? Yes, it's a court order that they can't say no.

Martha Brewer Motley  20:25

Yes. Are they cool with it? questionable? Do they have to comply with court orders, they do have to comply with court orders. There's a whole team set up and the team is very kind and they're very responsive, which is not the case for all of the Amazon various workflows. But the TR o team is specially trained to review these legal pleadings, and they know what they've got to do to push the right buttons.

Aaron Conant  20:52

So right, so this doesn't go to your vendor manager, this doesn't go to somebody help a seller central, this is completely different. Because there it's just gonna go to the recycle bin for them.

Martha Brewer Motley  21:04

That's exactly right. It yes, if you send it to the brand, registry person, please don't, we don't want them to then tip off the bad guys, because typically, what happens when you make a brand registry report is that it kicks out the emails out to the bad guys. And that tips, the bad guys off, hey, there's a counterfeit. So in the short term, it probably gets that one storefront taken down. But that bad guy who's scrupulous enough to source counterfeit goods is just going to create another storefront, move their stuff over, and then you're going to have to start the process all over again. So we do not want competing workflows here. We want it to all be through this litigation piece first. So that we have the element of surprise. And to Aaron's point, we have a direct channel into Amazon, where we can send these things and say, hey, just push the pause button on everything, so that we can get it frozen and then deal with it down the road rather than having to chase after this sort of Whack a Mole issue. Does that answer your question?

Aaron Conant  22:04

Yeah, yeah, it does. Because I think a lot of people would want to just make sure that we're capturing all of this, because you don't send it to brand registry team. I totally agree. And, you know, the next question that comes in, well, how quickly do they act? So if there's, from the time you file, the temporary restraining order, or the complaint for a temporary restraining order, it gets approved, then you send it immediately to them, then how quickly does Amazon act go freeze this?

Martha Brewer Motley  22:34

Yeah, so in terms of sequencing, when you kick off this with the core, it's what's called an extraordinary relief, which means the courts got to deal with it quickly. So the court will typically set a preliminary hearing within a day or two days, we have a network of local counsel across the country who can help us if one of us can't physically be there, and the court doesn't permit zoom attendance, we can get one of our local counsel to pop in and help or typically, courts are still doing a lot of things by zoom at this point, even though the pandemic's over some of the conveniences have remained. So that will happen within a day or two, and then we send it to Amazon. And it usually happens within a day or two. We know this sort of secret sauce of how Amazon wants to receive things. So as we all know, Amazon speaks, in a sense. So we have to give a list of the ASINs and the merchant IDs and put it in a way that's very easy for them. One thing that I see that is ineffective is folks will just send over a court order, and it'll say just the storefront name, like that's not helpful to Amazon because they don't speak in storefront, they speak in Merchant ID and ASINs. So once they get the merchant ID in a sense, it's typically just a day or two, for them to action that if it's a lot, a lot, a lot of ASINs that obviously takes longer, but if it's, you know, handful, 20 ASINs, they can usually get that done in a day or two. Awesome. Yeah, quick question. But yes, to your point, the brand registry process, I think the other big issue that we see is when folks start getting in test buyers that are showing true counterfeit, the natural impulse, and I think what Amazon trains everyone to do is just go ahead and submit it through brand registry. Again, it'll kick out that notice to the bad guy that says suspected counterfeit. Sometimes they can save themselves by submitting false or fraudulent letters of authorization. We've seen them submit fake letters. So they'll pretend like they're the brand and they'll type of this letter and send it to Amazon and say, hey, it's not counterfeit. I got it from the brand. It's pretty brazen. We've seen some people's names used in this where there are people who are publicly accessible to the sort of general public will see those names inserted on those letters. We'll see falsified signatures and then things that are just crazy and totally made up so the bad guys will go to any length We've seen to try to prevent all of this from happening. So we don't want to put them on notice. Don't do the brand registry takedowns. Get the lawyers involved first. And then Emma to the next slide, please. So, now we've gotten everything frozen. Where do we go from there? So we can ask the court for permission to do what's called discovery, which is when you can ask random questions, and ask for documents from the bad guys and also from third parties. So we can ask the court for permission to issue subpoenas to Amazon itself for certain data related to the bad guys sales. Amazon, you know, is protective over consumer information and is generally, I would characterize it as territorial over the bad guys data, but will give us things like what were the sales of what a sense, on what days, what jurisdictions were they sold into? How much did they charge were things returned. So when we get that data, we can help use that to establish what the damages would be meaning, what does the brand show that it's out of pocket that was sold by the bad guy that could have been sold by the brand? Because it's really hard to quantify what is the damage related to a counterfeit? One easy measure for that is looking at what the profits of the bad guy was. So we can get that data from Amazon. Sometimes when we're having a difficult time, tracking down the bad guys, and where they're located, we can ask the court for special permission to get them served by alternative means. So if you think of the traditional, you know, like sitcoms, you see the guy pop out of the woods with the pizza box, and he says you've been served. So that's service where you have to physically hand the documents to somebody, we have a great track record and have built up this really good case law around serving by alternative means. So we can send them the legal paperwork through email, or through regular mail, or even send it through the Amazon messenger system. And there's a lot of tricks and sometimes some machinations that need to happen to get those messages to go through the Amazon system. But we can get them served. So we'll have folks ask us, is it a problem that they have identified a US location on their storefront, but we think that they're physically located in Ukraine or China or name another place that is outside of the United States? And the answer is typically no, because if they have identified that US location, we can use that as a basis to the court to say, hey, they identified a US location, they're not picking up their mail at that location, or it's a bad location, or it's just falsified court, please give us permission to serve in this alternative way. And we can go through and we can search and find out email addresses and other physical locations, or we can serve it through the Amazon messenger. So that's sort of the concept of service of process, which can be a little bit tricky. And for those who are uninitiated in this sort of Amazon world, it can create some stumbling blocks, because folks will think I've got to go through all these special legal challenges in order to get someone served in a foreign country. And that can be true, but we've found ways that we can avoid having to do that if we don't absolutely have to. Another thing that we want to make sure we're doing is identifying appropriate targets. So sometimes brands want to pick a fight with the biggest 10,000 pound gorilla. And sometimes brands do not want to do that. We want to make sure that we've picked out the appropriate entity because as we know, a lot of these storefronts are interconnected and inter woven. And it can create some big issues. If you're picking on somebody and you don't realize where all of those tentacles are. Somewhere, somebody said, What about when the seller is located in cn, which I think is Canada? Is that an issue? It's not an issue, oh, in China, also not an issue. So when the seller is located in China, they're typically identifying the US address on their Amazon storefront. Canada is also not an issue. But we have found ways where typically those sellers have identified some type of a US location. If they've set up a business, that business is typically registered somewhere in the United States. And even if it's not, and they haven't identified a US location, we've still had success and getting service through alternative means. Meaning we can serve them by either the messenger system or email or both, or some combination, because really, the question for the court is, you know, what is the thing that we need to do to give fair notice of the lawsuit and the rules haven't been updated in the way that they should, in my opinion, to say email services good but in an E comm world where people are functioning only on EECOM sites, and that's how they communicate with consumers. We've persuaded courts that it makes a lot of sense for us to be able to serve them there too. So China is not a problem, we deal with that all the time. If they are genuinely located in China, there is not a US location and the court is being persnickety. And not letting us do this alternative service, we also have dealt with that. And there's ways that we can liaise with contacts in China to find them and get that service done. It's a pain, it takes a lot longer. But the important thing is, we can still have that temporary restraining order that pause button pushed, while all of that conduct is happening so that nothing is being disrupted while we're getting them served. We can also assist with the garnishment. So unlike traditional litigation, where you're on the defendants side, on the plaintiff side, you have the potential for getting some money. So a lot of these sellers have money sitting in their Amazon accounts. Last best knowledge that we have from Amazon is that it only scoops out that money once every two weeks. So it's a little bit of luck of the draw when you initiate those papers to get the money seized. But we have had good luck and getting judgments of you know, upwards of six figures seized from those Amazon accounts. So it's not just a cost center. It's potentially a source of income when these litigations are run appropriately. I'm on to the next please. Okay, and then as we sort of alluded to before brand registry reporting is the last step in this process. Once the cat is out of the bag, and the sellers know that the lawsuits been initiated, we can assist the brand in doing those appropriate brand registry complaints. The sequencing is so important, we don't want to tip anyone off. If you take away two things from this one, don't do bad counterfeited reporting and to if you think you have a counterfeiter, don't immediately do brand registry reporting, because we don't want to tip them off. So we do have a direct line to Amazon's global brand registry team that name changes. They're calling themselves something else now. I forget what it is. It'll be something else tomorrow, too. But we can help with what's the special language because there's certain words that they look for, or their algorithm listens to more than others. So we want to make sure that we're doing that in the appropriate way. And the next slide. Okay, so that was sort of generally what is the strategy as it relates to both of these counterfeit lawsuits and the design issues that Aaron's going to talk about. So I'll kick it over to Emma, who can talk a little bit more about the scariness associated with bad counterfeit takedowns and anything else counterfeit that you would like to know.

Emma Morehart  32:42

Great. Thanks, Martha. Yeah, so I'm going to dig a little deeper into what we mean by counterfeiting, because it is an important word and what options there are for tackling it, litigation related and other tools that Amazon has. And then I'll include a few examples of successes we've had for brands in counterfeiting situations that are particularly illustrative of what we're talking about. Changing the fact some and speaking generally, of course, to protect the brands confidentiality. So like Martha said, it's really important to know that counterfeit is a legal term of art. It's a product that is not manufactured by the brand, it's got a different composition or a makeup. It does not mean that the product is manufactured by the brand, but it's sold without the brand's authorization. And as Martha alluded to, we're seeing a trend of brands hiring these third party tech vendors, who advertise as being able to get sellers down really quickly and get source information. But what they're really doing is submitting counterfeiting takedown notices, where there's not actual counterfeiting involved, using the word counterfeit loosely when the products are not actually counterfeit, because they think it gets Amazon's attention. And it does, but usually in a bad way for the brand. Because Amazon does take counterfeiting on its marketplace seriously, and it examines counterfeit takedown notices closely. And there's consequences for the brand for submitting false notices of counterfeiting. We've seen Amazon spend storefronts for submitting false takedowns. We've seen them require the brand to provide proof of the counterfeiting within a certain period of time or face suspension, which obviously isn't going to be proof that exists if the counterfeit takedown notice wasn't accurate. And then as Martha was talking about, We've defended brands who have been sued by third party sellers, who were affected by what they allege was a false counterfeiting takedown notice to Amazon and we've been told by some of those sellers lawyers that when faced with a counterfeiting takedown Amazon can threaten to destroy Roy the sellers, counterfeit inventory within a matter of days. And one of the ways the seller can pause that and stop Amazon from destroying all the inventory is just by suing the brand that did the takedown. These lawsuits include tortious interference, unfair competition. Various state law and Lanham Act claims, including a federal claim that essentially asks the judge to say, we are not counterfeiting, and our sales are not trademark infringement. And so they're not always easy to get out of sometimes the sellers file this lawsuit. And then part of their settlement demands are the attorneys fees, they've already had to expand or the sales they've lost because their storefront was improperly taken down. And so it's not always necessarily easy to just settle it in and be done with it. Sometimes sellers want more than just their storefront being put back up. So it's really important for brands to work with experienced legal counsel to help the brand, investigate the counterfeiting, submit appropriate takedown notices, if that's the approach they choose, or work with Amazon or litigate and proceed with the various options. The big counterfeiting issues we typically see also involve pretty sophisticated counterfeits. So we typically don't make a counterfeiting takedown notice, unless we are the brand have done an investigation proving that the product is counterfeit, like a composition analysis, sending the product to the lab to test the ingredients, taking the product apart and examining its components, examining the packaging closely for different markings or misspellings on the bottle, things like that, to have proof of counterfeiting before we even go to Amazon. And we've had multiple clients come to us after using a tech vendor that did this brand registry thing wrong. And we know how to manage the ins and outs when that does happen. But we also know how to help the brand tackle counterfeiting from the beginning in a way that works within their overall online strategy and doesn't expose them to that legal risk. And so, one of the things that we routinely do is work with Amazon's counterfeit Crimes Unit or CCU and we'll work with a brand and provide Amazon with relevant information about the counterfeiting situation like the storefronts that are counterfeiting. Information about testifies that the brand has already done. takedown notices the brand has already submitted results from lab composition analyses proving that the products are counterfeit. We'll send all of that to Amazon. And then Amazon, as Martha said, has access to a lot of data that it's pretty protective of. But the CCU has access to it too. And in counterfeiting situations, can use its resources to see data sort of behind the storefronts. So for example, they can see where products are coming from when they're shipped into Amazon's warehouses to be fulfilled by Amazon. So even though the information on the storefront is more than likely false, the information with the return address that a product was shipped to the warehouse from is generally going to have to be accurate. Amazon can also see where the seller has designated that product returns should go. Amazon can also see IP address login stamps for sellers, and it can work with its connections with law enforcement locally and abroad for even further data collection. And so when brands are working with the CCU depending on the situation, there's a couple of different options. In some situations, Amazon might want to pair with the brand and file a public lawsuit against the counterfeiters. This is at no cost to the brand, and frankly, is good publicity for Amazon to show the public and governing bodies that it is policing counterfeits on its marketplace. This option can though potentially create publicity for the bank brand about its counterfeiting problem that it may not one out there. And so we can help brands analyze the risk of potential press work on public messaging, and make a determination on how helpful or harmful this option might be within the brand's overall strategy. Another option, sometimes Amazon will want to do a joint criminal referral with the brand. And that means that Amazon and the brand with our help, will jointly package investigative information to give to the appropriate authorities to get counterfeiters prosecuted criminally. This is also no cost to the event, the brand and it avoids potential big press headlines. As the criminal indictments are typically sealed, even if they're not sealed. brand names are typically used discreetly referred to as like calm NEA instead of the brand's name, but the counterfeiting issue typically needs to be pretty significant in scope or in consumer harm for Amazon to commit its resources in this way. And so we can talk through this option with the brand and with Amazon and the CCU. Another thing we can help brands accomplish for a longer term strategy to tackle counterfeiting is brand gating. And it's a little harder to get now than it was in the earlier days of the Amazon marketplace. But brand gating requires three P sellers of a brand's product to apply and fulfill certain criteria to be allowed to sell the products. In other words, proof that they're allowed to sell. And brands have to be enrolled in brand registry and provide pretty specific information to Amazon for Amazon to even consider gating the brands. That's why this is another area where it's helpful to have counsel involved to provide the information to Amazon, and convey to Amazon convince it that these products need to be gated. There's a big counterfeiting issue. It's an important counterfeiting issue. And we know from experience that the two key considerations for Amazon on whether it wants to Gator brands products are evidence of the scope of the counterfeiting problem. So either the number of products, or the number of ASINs that are affected, how much money consumers are spending on these products, how many consumers have bought counterfeit products, which is all data that Amazon has, and also the level of risk to consumer health and safety based on the type of product. Brand gating is not a quick or a guaranteed process. In our experience. It's often at the whim of Amazon. But we have seen that doing things like testifies lab analyses getting the CCU involved, having the evidence counterfeiting, showing that the brand is also taking efforts to protect itself from counterfeiting can help Amazon take the step of helping out and gating the products. A related option that I'll touch on briefly is Amazon's transparency program, which brands have to enroll in and meet certain requirements again. And it involves transparency codes being stamped on all authentic products, so that only those stamp products are even listed and shipped by Amazon. And this can be really helpful to some brands. But it also depends on the scope of the issue because it works on an asin by asin basis. So if there's a lot of impacted various ASINs, it can be a little voluminous to manage. Vorys eControl also has experience enforcing against counterfeiters who are not selling on Amazon. And we can work with the Customs and Border Patrol or work with local authorities to get products seized. If the brand knows the location of the warehouse where the products are being stored. We see a lot of counterfeiting on Amazon. But obviously there's some off so we can address a brand's needs there too. So I want to talk about a few examples that I think hopefully touch on what Martha's talked about today, what I talked a little bit about, obviously not the the ones shown in the pictures, of course. The first one is a seasonal topical product brand. So this brand creates seasonal topical products with specific formulations for safety. And it discovered vast amounts of counterfeit products being sold on Amazon during peak season. And so it considered the the two avenues that Martha talked about litigation, filing the lawsuit seeking a temporary restraining order doing alternative service freezing the accounts to get the money out of them. It also considered submitting brand registry takedown notices. And that worked, but because it was coupled with other efforts, so the brand ultimately was submitting brand registry takedown notices. And even though that did sort of communicate the problem to the sellers, or has also worked with its contacts within the CCU to get Amazon's attention and sort of rein it in. And as a result with the help of the CCU, the storefronts that we're selling the counterfeit products were removed by Amazon, as were new storefronts that kept popping up because the sellers would pick up their operation and move it to another storefront. Amazon was removing those newly discovered storefronts as well. And because of the incredible volume of counterfeit products, Amazon and the brand agreed to do a joint criminal investigation into the counterfeiters and compiled all of that information. Interestingly, Amazon for this brand also agreed to remove all customer reviews that were affiliated with the counterfeiters, which is a big boon to the brand's reputation on Amazon. So there's different considerations for each approach. This worked out it was effective and pretty low key. But Amazon borrows the money in the counterfeiters, accounts to contribute toward refunds to customers who had bought the counterfeit products without litigation and a court order. The brand couldn't demand entitlement to the revenues in those accounts, but it did get the storefronts down. Another brand, who's dealt with this is a really interesting supplement product and they create supplements, formulated specifically without certain allergens and ingredients. And this brand diligently conducted test buys from unauthorized storefronts, and discovered that the products were counterfeit. They appeared to be being manufactured in another country. And they contained all of the allergens and ingredients that this brand had banned from its products. It sent these test buys to a lab and it got a full report of the ingredients and the allergens and everything that was contained in those supplements. With various help investigating the sellers that also discovered a link amongst several of the storefronts that were all selling the same kind of counterfeit products, and it filed a counterfeiting lawsuit against those defendants. And through those defendants that obtained discovery about other actors in the scheme that sort of allowed the brand to form like a link chain to the main source of the counterfeiting and initiate investigation abroad. Simultaneously with this lawsuit, we were working with our contacts at the CCU which helped the brand begin to identify the potential identities and location of the counterfeiters in the foreign country. And all the while the other litigation options remain open to the brand if it wanted to take that route. Because this brand was persistent, and because this brand had excellent proof of test buys and counterfeiting, and through its work with the CCU. During the course of this Amazon did grant the brand's request for gating after some months, and that helped a lot to getting those storefronts automatically down. The last one I'll talk about real quickly so we can move on to Aaron. Martha sort of alluded to the unfortunate the Scituate situation that this brand found itself in and that it submitted takedown notices. But Amazon gave the affected sellers a 14 day window to appeal. So the takedown notices were proper, there was proof counterfeiting, Amazon accepted them. But it gave the sellers 14 days to provide an invoice authenticating the product. And of course, the invoices were fake. Or in some cases, Amazon will authenticate the invoices on a virtual interview and you know, someone will hold up a piece of paper showing the authenticating invoice. And regardless of you know whether Amazon accepts that or not. During this 14 Day appeal window, the listing remains up. So customers were able to continue to buy these products. Eventually this brands persistence and its combined efforts of working with the CCU and submitting these takedowns paid off and Amazon also was able to gain this brands products which was a big success. So with that I will turn it over to Aaron to talk a little bit how counterfeiting works in the design patent contracts.

Aaron Conant  48:47

Yes in Aaron what we might end up having a follow up one as well because they wouldn't cover it and you know, in five to seven minutes here, let's give it a whirl.

Aaron Williams  48:58

I'm gonna give it a whirl.

Aaron Conant  49:01

I know is the reality is it's very complicated and you have to be thorough. You have to be thorough, because there's so much at stake if you're not If you do yank them down you don't do at all that's the wrong thing to do. You lose money. And if you do it and then for some reason you're not thorough, then they don't get taken down. So anyways, I'll jump Aaron to you.

Aaron Williams  49:26

Emma, a few go to the next slide. I'm going to cover this pretty quick, high level and then to Aaron's point, if we need a follow up with some more detail, happy to do that, and provide some additional context but a lot of what we've been talking about today, you know, brands have, you know, one two products that that are giving them problems but what happens when there's plenty 50 100 players out there that have products that are either violating your your trademark rights or or patent rights over the last For three years really since the about the second quarter into COVID, there's been a large scale movement towards these on mass litigations against foreign e commerce sellers and district courts in the United States. In both trademark and patent, we're seeing, you know, litigations involving 50 100, upwards of 250 defendants. And it's a way and a tool that brands can use. Basically taking all of these enforcement mechanisms that we've been talking about today, and applying them on a large scale, filing one complaint, one temporary restraining order one motion for preliminary injunction, and getting one judgment against 200 Plus sellers in a span of about four months. It's a tool that, that we've been looking at it and following. And there's different ways to handle it. But it follows a lot of the same steps and investigative patterns that Martha highlighted early on test bias, doing them properly, making sure that you know which jurisdictions you're looking at, and which jurisdictions are friendly to these type of procedures. They're unique. And so being in a jurisdiction that has familiarity with them, and familiarity with the types of requests that are required, is paramount in these cases. And so working with counsel that is familiar with them knows how to handle them, is of the utmost importance. And so going to the next slide, I'm going to talk about one area of brand enforcement strategy that people don't typically think of which is patent protection. And when you mentioned patents to people, eyes roll into the back of your head, you start thinking about, you know, technical issues and science degrees and things that most of us ran away from in high school and college. But design patents are specifically geared to protect the aesthetic appearance of goods, right, they cover the aesthetic, non functional aspects of a particular good. And so if you're rolling out a new products, it's important to think about, Do I want to rely on trademark rights? Or do I want to guarantee that I have a monopoly over the way this product looks for the next 15 years, because that's what a design patent gives you. And so it allows brands to really control the marketplace, especially if you have a really new inventive concept for a good design patents cover everything from doors to consumer electronics and everything in between. One of the best examples I like to give people is crocs, right. Clogs have been around forever, you know, but crocs came out with a new interesting way to manufacture a clog that people would wear, whether you consider them fashionable or not, is up to you. But they patented, they patented the design of their clock, and were able to usethat patent monopoly right over that design, to keep others out of the marketplace and trying to pull market share from them. And their their new design. And so it's something to think about as you're putting together your brand strategy, if you're coming out with a new product, and you want to make sure that others in the marketplace can't take take away from your inventor of thoughts, and you want to protect that market share that you're hoping to develop. And so infringement is pretty easy. It's not like other patents, you do a side by side comparison of of the drawings in the patent with the accused product. And you decide whether or not an ordinary person would be able to determine that one is different than the other. So it's a pretty straightforward process, something that we can help with both on the front end on and on the back end. And we'd happy to talk with people more about how to use these strategies to help with their their brand enforcement efforts.

Aaron Conant  54:01

Really quick. We have a question that came in. We've seen a company called Amazon Exports LLC hijacking our obsolete ASINs and selling products that have been discontinued. Right. So I initially thought this was part of Amazon, but it's not try to do brand registry, but people internally think it might be part of Amazon. So they're not pulling it down. Like, is this something you would help with? Like, I'll pull down if they're selling obsolete, old ASINs that aren't being manufactured. And I think if you have this in place, a design patent, it'd be pretty straightforward but um.

Aaron Williams  54:35

If you had a design patent in place, and they were taking the ASINs and selling using the ASINs to sell their product that looks, you know, identical to yours, then yeah, that would be in place. I'm not familiar with the process of buying the audience and selling them. I don't know if Martha has come across that question. With with clients before or not.

Martha Brewer Motley  54:56

Yeah, yeah. So just real quickly, I would guess It's not Amazon is confused, I would guess the Amazon doesn't care probably because the appropriate language hasn't been popped into that brand registry report. So there are certain language that they care about and like to see, we can help develop that language. But I would guess that it's not confusion, although I do think Amazon's intentionally siloed I think in this case, they know and they just haven't said the right words yet.

Aaron Conant  55:23

Awesome. What are the quick any key takeaways here? As we kind of wrap up, we're gonna push up right against the hour. But did we have a follow up one or that we go a deep dive on this design pattern? So maybe it's only 30 minutes, but I see here, but I totally agree. It's got to be a fastest growing segment of E commerce enforcement, because everybody's gotta be thinking about doing this. But anyways, quick. Any,like key takeaways, Martha and more than happy to connect everybody with the Vorys team for the call?

Martha Brewer Motley  55:48

Well, I think the key takeaway is don't let me talk first, because I'm going to talk the whole time. The other key takeaways are just to be super careful when you're doing this. Make sure you're vetting your counsel, you know, it's easier to go at it fresh than to try to come back in and clean up mistakes that other people have done, even if it's not. So you're looking for lawyers, make sure that there's somebody who has know how in this specific field rather than just sort of a general litigator. So that's probably the most important thing that I would give us my key takeaway.

Aaron Conant  56:15

Awesome. Well, everybody will get a recording of this out. Thanks, everybody for dialing in the questions that came in. Yes, copy will love the follow up on design patents enforcement 100%. And sorry, we didn't get to the GS one more than happy to connect you with the Vorys team. After the call this we got to wrap up as we push up right against time. Look for a follow up email for me. I'd love to connect with everybody on the line today. And more than happy to connect you with everybody over at the Vorys team, they are great friends, partners, and supporters of the network that, can we get a copy of the deck? Are we able to send that out team? If we can't we'll send it out.

Martha Brewer Motley  56:53

Pretty much content but yeah, we can we have other things we can send you that are probably better.

Aaron Conant  56:57

Awesome. Well, with that we're gonna wrap up. Thanks again, everybody for joining. Everybody take care, stay safe, and look forward to having you at a future event.