Veken upholds Patent Rights of Coral Fleece Products

December 17, 2008 - China

In a major step to protect intellectual patent holder Veken Group Holding Co Ltd, and its patent protection case on “Coral Fleece,” the extremely popular microfiber plush fleece, a large shipment of infringing Coral Fleece products have been seized by Shanghai Customs, as reported in the December 8, 2008, edition of China’s leading business newspaper the International Business Daily.

The shipment, licensed under the Cannon brand name and exported by SunWin International Trading Company, was destined for Sears, Roebuck and Co. stores in the United States. Veken’s patent rights were filed with China Customs agents nationwide and have established the first successful case where, pursuant to law, Customs can withhold product suspected of infringing upon the Coral Fleece patent.

Customs’ seizure is just the first step in upholding the rights of the patent owner. If patent infringement is confirmed, the violating company risks product confiscation, a fine up to 30 percent of the merchandise’s value, and possible criminal charges. All companies involved also are registered on a Custom’s “Blacklist” and are subject to long-term monitoring.

An executive with Veken states, “What is important is the patent’s validity and that suspected infringing manufacturers be put on notice that infringing products will be seized according to the law.”

This case is historic as it is the first time the Chinese government has upheld the rights of an intellectual patent holder in China. Veken Group Holding Co Ltd, owner of the intellectual patent on Coral Fleece, has successfully held competitors at bay with winning this important and historic decision. In October 2008, more than 150 factories in China had petitioned the State Intellectual Property Office to withdraw its approval and make the patent “public property,” threatening the loss of 300,000 jobs and the shut down of 200 factories. However, after a huge media debate, Veken came out on top and successfully defended their patent, which was issued July 26, 2006, by The State Intellectual Property Office of The People’s Republic of China. The patent gives Veken exclusive rights to the patented technology for Coral Fleece through July 26, 2026.

“The industry has no other possible choices but to protect both the intellectual property and company’s legal rights,” said Mr. Yang Ji Chao, secretary general of the China National Textile and Apparel Council (CNTAC), as reported in the International Business Daily, in a front page article entitled “A Forerunner’s Plight: The Passion, Logic, and Law of an Ongoing Story Between a Patent Holder and Patent Violators,” published November 7, 2008.

Coral Fleece blankets are cozy, smooth, and marked by their fine texture, plush hand, and strong temperature retention. Veken successfully introduced its patented Coral Fleece product and customer response to the blanket was huge and an instant success. Purchase orders exceededproduction capacity, and for years, supply could not meet demand. Shortly after Coral Fleece hit the international market, infringers rushed in.

Today, more than 150 other factories have illegally employed Veken’s patented technology in creating their own versions of the Coral Fleece blanket.

With China’s landmark upholding of Veken’s intellectual patent rights, other manufacturers wanting to make and sell the Coral Fleece blanket will have to apply to Veken for approval of use of its patent through legal means. Veken holds the patent for all Coral Fleece products made in China and sold in North America.

Specializing in textile manufacturing, international trading, real estate and energy investment, Veken Group Holding Co., Ltd., is a publicly traded company with total assets of 6.9 billion RMB, 10 billion RMB in total revenue, and $700 million U.S. in total global export sales.