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Lessons on intellectual property from Woolies baby carrier debacle

Response from SA retailer ‘disappointing’.

NOMPU SIZIBA: Woolworths announced this afternoon that it is removing a certain baby carrier product from all its stores and online platforms with immediate effect. This follows business woman Shannon McLoughlin protesting on social media about the company copying her baby carrier design to a T.

It was brought to her attention in December last year, when someone sent her a picture of baby carriers that Woolies was selling, which looked almost identical to what she has painstakingly designed over a number of years. Woolworths has since apologised to McLoughlin, and she is said not to have an appetite to go down the legal route. So, what lessons can be drawn from this sorry episode?

I’m joined on the line by Jeremy Sampson, the MD at Brand Finance Africa, and Bastiaan Koster, a patent attorney and trademark specialist at Von Seidels law firm.

Jeremy, this is a big blow for Woolies, and seemingly an admission that indeed some copying did go on, on their part. How could there have been such a lapse, given that, if caught, the reputational harm would be so severe? Could this have been an innocent mistake?

JEREMY SAMPSON: That’s a great question, Nompu, to kick this one off. [Chuckling] How long have you got? As you say, Woolworths has got into difficulties before. As someone else said, it is too big a target to miss if aimed for.

I think a lot of people will be rather disappointed with the way the retailer has handled this. Yes, we know it’s a difficult period from mid-December to mid-January, but, even so, given the size of the organisation, the attention to detail that normally permeates everything it does, the way in which it has responded to this has been disappointing. They are only really playing catch-up now. I’ve briefly seen something that was put out on Twitter. I haven’t seen the full text. Now the company seems to have its act together – something that, quite bluntly, it should have been doing a couple of weeks ago.

NOMPU SIZIBA: Bastiaan, Ms McLoughlin has opted not to sue Woolies, and she has of course got the apology and the product off the Woolies shelves as she demanded. But if she had opted to sue them, what recourse would she have had, and would she have necessarily had to have registered her designs to successfully sue the retailer?

JEREMY SAMPSON: Again, how long do you have? I had one of these when my daughters were younger. The youngest is now 18. I’ll tell you what the law says, and I haven’t looked at the products. I have only looked at them in pictures. For me, it simply shows the power of the social media – but that is another question.

The first thing we must remember is that there is nothing wrong with copying. If I design a product – for example, a baby carrier – and put it out to the market without a registered design or patent, anybody can copy it. So, fundamentally one can be copied.

However, there is a social issue here and a social media issue. I’ve briefly looked at, for example, the Ergo baby carriers. If you go onto Google and search Ergobaby carriers, there are many that look exactly the same to me as the pictures of the Ubuntu and the Woolworths carriers. The idea of a baby carrier that looks very similar to the Ubuntu or the Woolworths one is definitely not new. You can’t register a design after the fact. You have to register it before. So I think that, in this case, the Ubuntu product was not protectable by way of a patent or a design.

So, what other recourses are there? There is something called “copyright”. That also will not work in this instance. There is “passing off” – so Woolworths can’t pass the product off as being an Ubuntu product, for example – but I don’t think that was done. There is “unlawful competition”, which I think is a very difficult thing to prove. And then there is “trademark infringement” – and on the face of it, I don’t see trademark infringement.

Woolworths is not my client but, if it were, my immediate advice, without seeing the products, would have been you are okay in law, but not in social media. Maybe there are other views on this.

NOMPU SIZIBA: Bastiaan, I want to ask you: do you think that their hand was forced because they didn’t want to be unpopular with the South African public considering that social media is so powerful in this country?

BASTIAAN KOSTER: Exactly. Again, I haven’t looked at the products. I don’t know the background. But, just looking at what I have seen in the last few hours when I looked at the pictures on the internet, the concept of a baby carrier is not new. I’ve seen various ones from other companies that look, on the face of it, virtually the same as the Ubuntu and the Woolworths products. So I think that in this case, it might be that social media has been more powerful than the law.

NOMPU SIZIBA: Jeremy, do you think that’s the reason? Why would they decide to withdraw the product? It would have cost them a lot of money to put this product out on the shelves, and now decide to completely discontinue it. Why would they make that decision?


JEREMY SAMPSON: Well, Bastiaan has really touched on it. Let’s take a step back. What did the business register? Is the name Ubuntu Baba and the logo that’s appearing on the product registered? I’m not sure if it has followed those processes.

There has been a vacuum and that vacuum has played into the hands of the social media. As I said, it’s been like a fire storm, call it a lynching mob, call it what you like. It has become incredibly emotive and I think some of that emotiveness was led by the use of words like “shameless”, used by McLoughlin in her rant.

It caught Woolworths off-guard, and this is where social media is potent, quick and agile. Woolworths wasn’t ready for it, which I think is a little bit shocking given, first of all, its size, and how it is [supposedly] very aligned to integrity, and so forth. 

I come back then to the Twitter statement I’ve seen, and what I’ve seen –- the tone of voice, the choice of words. Much more professional, much more contrived. I’m not sure how much Woolworths has admitted to, but, as you’ve stated already, it said there were striking similarities, and as a result of that they are going to withdraw from the whole scene.

NOMPU SIZIBA: Yes. The problem then comes that it goes beyond the baby carrier, doesn’t it? Some people now decide to go and shop elsewhere and not at Woolies because they’ve beef with Woolies – and it all starts with that small baby carrier.

JEREMY SAMPSON: You are quite right, and this is where we talk of a brand. It’s not just the trademark, it’s the total experience. When you walk into a Woolworths, it’s the totality, even the lighting, the way it’s set up; all that is geared to make you as consumers think, well, I like this place, I trust it, I’m happy to spend my money here, even through it might not be the most affordable.

NOMPU SIZIBA: Bastiaan, we often talk about entrepreneurs being potential game-changers for innovation and growth in the economy. What’s your advice to people out there who think they’ve a great idea, but will need to sell the idea to a potential funder? How important is it that they secure or register their idea before they share it with people – and is it a costly affair?

BASTIAAN KOSTER: Look, in this case, yes. Possibly there was a design, but I don’t think so. It’s unlikely that there is a patent. But again, to protect this product, the trademark, Ubuntu is probably the best. So, as we said, there is nothing wrong with copying.

I can today go and buy one of the Ubuntu baby carriers, take it apart, and make exactly the same thing. I just can’t call it Ubuntu. So, when you get to protection for innovation and entrepreneurs, there are horses for courses, in some cases patents, in some cases designs, very often trademarks – and sometimes just staying ahead of the market. And in this case I think social media just played into the hands of the Ubuntu product.

But again, as Jeremy said, one should encourage competition. If you want the Ubuntu product, you’ll pay R1200 or R500, and there is something similar much cheaper. And in principle there is nothing wrong with copying a product like that, unless it is protected by a design or a patent.

NOMPU SIZIBA: Jeremy, we’ve had much discussion already but, just to conclude, what lesson can brands and even entrepreneurs learn from this latest example?

JEREMY SAMPSON: I think from the entrepreneurial side it’s often a small organisation, a man or woman who comes up with a great idea, and, as Bastiaan says, they need professional advice. That’s difficult sometimes, because in illustration there are so many facets to it, and that means there is going to be a financial cost as well. But you’ve got to – even if you record and put it into sealed envelopes, I was told once – send a registered mail to your lawyers with the date on, so the ripples can be tracked back. You’ve got to try and do something to protect your IP, your intellectual property.

But then when it comes to the big boys, like a Woolworths, I think, as we all know in business today, if there is one keyword it’s “agile”. You’ve got to be quick, you’ve got to respond. I’m still amazed that from Woolworths’ side we haven’t heard from the chief executive. To me, he should have been out there right away, and in a tone of voice be contrite, saying, we are looking into it, give us time, it’s been the holidays and we’ll be reporting back in 48 hours. But we’ve heard absolutely nothing from him, and I think that’s unforgivable.

NOMPU SIZIBA: My thanks to Jeremy Sampson and Bastiaan Koster.

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Who is who here? Jeremy is talking to himself in the 3rd person.

Maybe South Africans should start buying local instead of just complaining about the unemployment rate and crime levels

Ah, Woolies, have a terrible reputation for using other people’s innovation as their own. Consider their intent to make diabetic friendly ice cream, which was quickly dropped when an friendly phone call from the innovator reminded them of who had developed the ice cream. They will probably cite other reasons for dropping their plans for the product, but, with the weight of other copy cat stories, like the one above, it makes me think that Woolworths copies, tries to get away with it, and if called out, drops it. Schlenters!

They still make and sell diabetic friendly ice-cream. This is not something you can patent or even copyright, unlike original Ice Cream perhaps. Maybe a specific formula or recipe can be copyrighted. But then it is up to the aggrieved to prove some kind of corporate espionage occurred rather than happening upon an exact/similar recipe independently. See: Coca Cola secret formula and the many multitudes of ‘Cola’ or ‘diet Cola’ out there.

Woollies has a history of doing this – Frankies and the hummingbird design are two recent cases. The problem is that most small businesses lack the resources to stop this kind of thing. Frankies was the exception but you can bet that Woollies will continue doing this until a really big case comes along or its customers vote with their feet.

It is important to distinguish between what’s legal and what’s ethical. Something which is legal is not necessarily ethical.
The following points are pertinent here:
1) The real question is, did the person who procured the product from wherever for Woolies know about the Ubuntu product? If yes, shame on Woolies. If no, should s/he have known about it? Difficult one. Can anyone know everything about what’s available on the market?
2) Social media is jungle justice. There is no discipline, no way of ascertaining the facts before judgement is passed. It is a monster that is devouring common sense – which in any event is not that common.
3) If you have a great idea and it is capable of being registered as a patent or a trade mark, take the time, trouble, and expense to register it. You never know when it will pay off big time. Gorilla glass was used in oven dishes for decades before the cell phone era, but the killing was made when it stared being used for cell phone screens.
4) While damage can be done to a brand by such a social media outcry (justified or not), are the Woolies customers really going to leave them in droves about this? If the things why people shop at Woolies remain the same, I think not.

Thank you LouisV for rational comments among the tsunami of hysterical mindless social media chatter.

Sounds like jungle justice.
Woolies gets my vote on this one.

Not surprised the boss of Woolworths is “missing” from this PR disaster.

His company has a long history of stealing other innovators’ ideas, and then pretending this was some sort of accident and promising never to do this again.

And here we go again with the “same old” at our super-ethical “you can trust us” Woolworths! Not!

His staff bought samples of the Ubuntu product, then outsourced its copycat production from China.

Somebody at senior executive level would have signed off on all this. And now he pretends he knew nothing? Come on!

Plagiarism is alive and well in SA.

There have been some real lulu’s in this field in SA.

Easily the most egregious and shocking case is the story of the golf tee sold as “Brush-T”

Not only was this copied from the original Inventor, the plagiarists falsely claimed THEY were the original inventors!

And then to cap it all, had the chutzpah to enter it into an SABS Design competition, where it walked away with the Chairman’s Award for the best product, due in no small part it seems, to these entrants co-opting one of the judges, Brian Steinhobel, as one of their team.

The really shocking part is that when this controversial background became known to the SABS, they refused to take the obvious action of withdrawing the award even though they were apparently presented with undeniable evidence.

Steinhobel later tried to sue the Inventor for defamation but abruptly withdrew his case just before it came before court and apparently paid the Inventor’s expenses – presumably because Steinhobel feared the reputational damage if he lost the case.

Why would an innocent party do that?

why shouldnt Woolies be able to deliver to the market the same product at half the price – clearly this women (the entrepreneur) is ripping us off – GO WOOLIES PLEASE BRING US THE PRODUCT AT HALF THE PRICE – You are fully entitled to see a product and copy it !! that is the law (as the lawyer in the interview has confirmed) and that is the way the world works !! it is a free market economy and everything in life is copied – else the world would be full of monopolies.

And we wonder why the public has a problem with business and their appalling lack of ethics?

If you write this ethical business behaviour and claims into your “non-negotiable” company policies and procedures, then it can’t be too much to hold you to account to your OWN rules???

That’s the Woolworths PR problem in a nutshell here. And why CEO Ian Moir needs to step up to the plate and take personal responsibility for the chasm between Woolworths professed behavior, and their actual behaviour.

I have no idea why they have a patent lawyer here at all. Patents are for truly innovative and new products and designs. There are specific criteria to determine this. This baby carrier uses already established designs, fixtures and materials in its construction. Clips, strap, attachments, materials, arrangements, sewing, adhesives, etc as well as the orientation and basic design are all public domain (if they were patented at all) and available on a vast array of baby carriers and other products alike. This is all conjecture of course, but until any specific instance of infringement is made clear, it is an appropriate assumption.

It’s rather disappointing however that this interview glosses over and dismissed ‘passing off’ which is exactly what this is. If you release a product, intentional or not, that is a dead ringer for your neighbors product. They are well within their rights to send you a cease and desist letter followed by legal action if required. Here it was just done on social media, likely intentionally, for the inevitable hype and exposure generated from accusing Woolworths.

Selling your own version of something is fine, as long as it is different enough to not cause confusion in the mind of the purchaser and you didn’t renege on a formal supplier agreement to corner an established market. Why Woolies cannot learn their lesson here is beyond me.

The problem arose not because Woolies were selling a baby carrier, but because two of its procurement staff purchased items from Ubuntu Baba and copied the product with virtually no changes prior to the introduction of its baby carrier line. Cutesy factor at work here?

The question now is, from whom did Ubuntu Baby copy or based its design on? because it surely is not original!

I made use of a very similar baby carrier eleven years ago made somewhere in the far East. If there had been no link between Woolies employees and Linkedin, Ubuntu Baba would have got nowhere.

But that is not the issue here. Ubuntu Baba is a small niche (cottage) industry which appeals to a certain market (snobs) and really has a minute share of the market for baby carriers. The average set of parents cannot in any way afford R1200 for a item that will be outgrown in a period of months. Looking at the baby carrier it can be produced for at the most R200 all inclusive and I am being generous.

So, Ubuntu Baba and Woolies, in my opinion, cater to very different market segments. The problem with cottage industries is that they are exactly that; set up to provide a second income and are not volume businesses. There are myriad of such businesses being run from home and they all go for funky products that while cute have limited appeal. just go onto Facebook and search and you will be overwhelmed.

Moral of the story? If you are going to copy, cover your tracks …

I wonder if it makes sense to put forward lines of argument against innovators – even if Woolies is, in certain cases, legally correct: the philosophical issue of discouraging innovators in an economy desperate for innovation is quite pressing.

Except that this is not a novel product. It may be ergonomically better, QED, but innovative it is not. It was also copied.

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