Many aftermarket distributors think they can’t be held liable for selling counterfeit parts or if a consumer is harmed by a defective component. “That’s a myth,” Sarah Bruno, an associate with Arent Fox and Heavy Duty Manufacturers Association general counsel, told attendees at a panel discussion held yesterday during Heavy Duty Aftermarket Week in Las Vegas. “You can be held liable even if you had no knowledge the product was defective.”
In assigning liability, courts consider several factors: where the goods were purchased, whether they were sold with authenticating documentation and whether the quality differs from what’s expected by consumers, Bruno said. Unusual pricing, coding, or language on billing slips are also red flags, she said.
To reduce their liability, Bruno recommends distributors pay attention to details such as packaging slips, part quality and safety standards. Also, check to make sure the country of origin is what you expected and that trademarks and logos are authentic. “If something’s off, call the manufacturer to verify,” she said.
Other steps Bruno recommends distributors take:
· Trust your gut – if something doesn’t seem right, pull it, contact the manufacturer and put them on notice of the problem.
· Protect yourself contractually – have an agreement with the manufacturer that asks them to indemnify you for any claim of infringement.
· Require the part manufacturer to meet safety specs and to warrant the product accordingly.
· Buy brands you trust.
Distributors must take responsibility for the products they sell, said Mark Karon, president and co-owner of Total Truck Parts. “If we sell inferior products and they end in a tragic result that plays into the right-to-repair issue,” he said, referring to the controversy over independents having access to supplier technical information. “We can’t hide behind the idea that it’s not our problem.”
To help lessen liability, “know who you’re doing business with,” recommended Joe McAleese, president and CEO of Bendix Commercial Vehicle Systems. Because of the research, development and testing that goes into them, branded parts are more expensive, but the benefits should outweigh the cost, McAleese said. Troubleshooting assistance, training, “all that improves the economics for you,” he said. That investment is why Bendix has been very aggressive in defending its brand. “We focus on intellectual property protection, education in the field about the impact of counterfeit goods and then we do enforcement. It’s important for us as an industry to take this very seriously.”
Suppliers should help distributors make the case for using more expensive, branded parts, Karon said. They “need to get more guts,” he said, instead of letting their lawyers talk them out of providing distributors with the tools they need to define their products’ differentiation and value.
