Nearly half of all business owners carry some form of cyber insurance but small businesses lag behind, largely because they don’t see themselves as vulnerable to an attack when, in fact, they are viewed by cybercriminals as the lowest hanging fruit. Rightfully so considering a startling 47% of small to midsize companies have not made cybersecurity a priority.
It is 2016: fifteen years since China was admitted to the WTO and the
first counterfeit part was reported to ERAI; a decade since ERAI’s
President made a second trip to China to see firsthand how e-waste was
being used to fuel what has been referred to as a counterfeit
epidemic; and nine years since I wrote ...
For more than a year, beginning in January 2014, a distributor in the U.S. placed eleven (11) orders for more than 16,000 pieces of Texas Instruments part number TMS320VC5416ZGU160 from an Israeli distributor and subcontractor servicing the defense, medical and communications industries in Israel. No nonconformities were ever detected during the inspection of these shipments. No complaints or concerns were raised by the U.S. distributor’s end user and sole recipient of all prior shipments. For all intents and purposes, the Israeli and American companies enjoyed a mutually beneficial relationship and no one, including the end user, had reason to suspect the goods in question were anything other than genuine Texas Instruments parts. That is, until May 4, 2015, when one of the final three scheduled deliveries containing 4,000 pieces of the aforementioned part worth $46,435.00 was detained and subsequently seized by CBP under Title 19, United States Code, Section (USC) 1595a(C) for bearing a counterfeit trademark. The initial detention notice triggered a flurry of activity that would slow to a crawl, then drag on for ten costly, labor-intensive months and ultimately conclude with the release of the goods. This distributor’s experience captures the significance of goods being correctly classified as authentic or counterfeit, highlights the importance of an open line of communication between CBP and industry, and personifies the struggles business owners are facing that could result in substantial financial loss.
Refurbished parts are defined as “parts that have been renovated in an effort to restore them to a ‘like new’ condition, e.g., leaded parts may have had their leads realigned and re-tinned and subjected to cleaning agents and chemical processing”i But what if this “restoration” process also involves altering the part’s surface and remarking?
In recent months ERAI has identified a disturbing trend particularly, but not exclusively, involving Chinese suppliers and service providers, whereby remarked parts are being sold or identified as refurbished. It’s as if these individuals believe they have circumvented the laws that have been broken if they merely identify the parts as refurbished as opposed to new. They have not. Organizations are violating intellectual property right law even if the true nature of the part is disclosed.