Wisconsin Electronic Controls Innovator, Raffel Systems, Announces Plans to Seek U.S. Government Investigations
Wisconsin Electronic Controls Innovator, Raffel Systems, Announces Plans to Seek U.S. Government Investigations into Chinese Furniture Manufacturer Man Wah’s Trade Practices and Product Safety Based on Jury Verdict and Man Wah Emails in Public Record
In the wake of a $100 million-plus verdict and other undisputed Man Wah emails in trial record, investigations could lead to exclusion orders of Man Wah products for “unfair competition” and recall of all Man Wah “knock-off” cup holders due to potential consumer dangers
GERMANTOWN, WI., June 30, 2022 – Following its historic $100 million-plus verdict in the U.S. District Court for the Eastern District of Wisconsin, Raffel Systems, LLC, a global producer of controls and comfort systems for motion furniture and a variety of other end markets, today announced plans to urge three federal agencies to investigate Chinese furniture manufacturer Man Wah Holdings Ltd., Inc. (Man Wah) for alleged unfair competition practices and intellectual property theft.
On June 17, 2022, a federal jury in Wisconsin found Man Wah liable for willful trade dress infringement, misappropriation of trade dress, false patent marking and willful patent infringement related to Raffel’s integrated illuminated cup holder for motion furniture. Specifically, the jury awarded Raffel $97.5 million in punitive damages and $8.7 million in actual damages, totaling $106.2 million. The verdict is one of the largest ever in the Eastern District of Wisconsin.
“This case is about far more than the blatant theft of Raffel’s patented technology. This is about Man Wah consistently demonstrating a pattern of unfair competitive practices across the board, at the expense of American companies like Raffel,” said Raffel’s lead trial counsel John Scheller, a partner at Michael Best & Friedrich LLP, during an international telephonic press conference.
Specifically, Raffel announced it is considering requesting an investigation for illegal and unfair competition by the Federal Trade Commission (FTC) and the International Trade Commission (ITC). ITC penalties could include ordering the exclusion of Man Wah imports into the United States for a certain time period and other financial sanctions.
Raffel is also considering asking the U.S. Consumer Product Safety Commission (CPSC) to investigate and possibly recall all Man Wah furniture products imported into the United States that included copies of Raffel’s proprietary integrated illuminated cup holders, since Man Wah admitted it cannot determine which Man Wah products contain defective knock-off products that may put consumers at risk, and which contain genuine Raffel product.
“Man Wah had reason to believe these defects could pose substantial risk of liability to customers,” Scheller said. “And, according to the undisputed evidence presented to the jury, Man Wah’s theft of Raffel’s proprietary invention was willful.”
Another Raffel attorney, Lanny Davis of the Washington, D.C. law firm of Davis Goldberg & Galper PLLC said, “The ITC has the authority to bar future sales of a product in the United States if a company’s conduct with regard to U.S. inventors appears to be part of a larger pattern and practice. In addition, intentional nondisclosure of a product that poses consumer safety risk is a serious offense, and the CPSC could consider ordering a full recall. Given the jury’s determination of Man Wah’s liability, we believe the ITC and CPSC will seriously consider our requests.”
The jury was shown substantial evidence introduced at trial, including the following two emails sent by Man Wah’s former U.S. CEO Guy Ray:
- On November 26, 2018, Ray wrote to Man Wah executive Tommy Wong: “The dumbest thing we did, was have the new supplier use raffel patent # and description on each piece. Not only is that patent infringement, but it is fraud which if raffel wanted to pursue, could be escalated to criminal charges in addition to the civil charges already filed.”
- On December 20, 2018, Ray wrote in another email to Wong: “This is absolute b**ls s**t and I’m telling you now, we stand to lose 100m in business that we will never recover if we do not take care of this. Who is getting fired at Manwah because of this???”
“This case is about right and wrong,” Raffel Executive Chairman Paul Stangl said. “As a small company guided by innovation, our intellectual property could not be more important. We will continue our fight to show Man Wah and all the world’s biggest companies that intellectual property must be respected.”
“There is evidence Man Wah is continuing its practice of turning a blind eye to intellectual property, and that it may still be selling integrated cup holders that infringe Raffel patents while passing off the product as its own invention,” Stangl continued.
About Raffel Systems
Since 1982, Raffel Systems has been the industry innovator in developing electronic controls and comfort solutions for multiple end markets. Headquartered in Germantown, Wisconsin, Raffel is a global manufacturer providing design, engineering, technical sales, and customer service throughout North America, Asia and Europe. Through its Chinese subsidiary, Raffel also has manufacturing, engineering and sales in mainland China.
Media Contact:
Lincoln Zweig
(202) 906-0292
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