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Can I purchase a product from a manufacturer with intent to resell, and modifying the product in functionality and labeling?

Santa Rosa, CA |

Purchase an electric guitar named, Fender Stratocaster, modify it's internal circuitry, and cosmetic labels to not say Fender Stratocaster, and sell this product.

Attorney Answers 4

Posted

It's likely lawful to do what you propose ONCE and sell the guitar as a used, customized Fender Stratocaster. But you cannot lawfully do what you propose as a business enterprise. It's called "reverse passing off."

The above response is general information ONLY and is not legal advice, does not form an attorney-client relationship, and should NOT be relied upon to take or refrain from taking any action. I am not your attorney. You should seek the advice of competent counsel before taking any action related to your inquiry.

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Posted

Claiming you produced a product you did not can be a trademark violation called reverse passing off. Consult with an attorney to discuss exactly what you want to do.

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Posted

Probably yes, you can proceed as planned. There's no general wrongdoing in modifying and reselling a guitar. Potential problems arise depending on how much you modified the guitar and what you say about it. The test is whether the modified guitar is "substantially different" than the original. If your modifications (in the opinion of a court) render the guitar substantially different than the original, you'll probably be fine even if you claim the guitar as your own product. Safer, though, you can avoid any problems by simply being honest about the guitar: advertise it as a modified Fender. Problems would arise if you were to advertise a barely modified Fender as your own product. That would be reverse passing off.

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7 comments

Daniel Nathan Ballard

Daniel Nathan Ballard

Posted

You write: " If your modifications (in the opinion of a court) render the guitar substantially different than the original, you'll probably be fine even if you claim the guitar as your own product." That is clearly wrong. Read any of the cases linked to here: http://goo.gl/PcAO6N . The product at issue [a guitar] is not a copyrightable work so there is no "substantial similiarity" inquiry. Removing a products branding and either not replacing it or replacing with different branding is unlawful reverse passing off. Period.

Vance Ashley Woodward

Vance Ashley Woodward

Posted

Thanks Daniel. I agree that this is not a copyright situation. I was, however, referring to the doctrine articulated in the unfair competition case, Summit Machine Tool Manufacturing Corp. v. Victor CNC Systems, Inc. (http://bit.ly/16kJiif), wherein the court found no reverse passing off on the basis that the two machines in question were "substantially different" from one another. Incidentally, the questioner stated that the guitar's circuitry had been modified, so this isn't a simple matter of swapping branding labels. Exclamation mark.

Daniel Nathan Ballard

Daniel Nathan Ballard

Posted

In Summit, as the 9th Circuit explains: "This is not a case where Victor acquired a product that was clearly a Summit lathe, made modifications to it, and sold it as its own product. Victor made no modifications to the product it acquired. Instead, the inquiry is whether the product it acquired was a Summit product. The lathes ZMTW manufactured and sold to Summit differed from those it manufactured for sale by others in China. It was seven of the latter lathes Victor bought for sale under its own label. They were not identical lathes, but it is conceivable that the difference between the two lathes could be so inconsequential as to be considered the same." In short, the defendant in Summit did NOT purchase the plaintiff's genuine product, modify it, remove its branding and then re-sell it under its own brand. As the Summit court noted in its exposition on the law that conduct WOULD be unlawful, reverse passing off: "'Express reverse passing off' occurs when one party purchases or otherwise obtains a second party's goods, removes the second party's name, and then markets the product under its own name [cite omitted]. 'A defendant may also be guilty of reverse palming off by selling or offering for sale another's product that has been modified slightly and then labeled with a different name.'" That is exactly what the Questioner wants to do. And that's unlawful. Even according to the case you cite for the opposite conclusion.

Vance Ashley Woodward

Vance Ashley Woodward

Posted

The Questioner intends to modify the guitar's internal circuitry. Slight modification would result in passing off as you correctly point out. Nevertheless, the Summit court also said, "The district court's conclusion that the lathes bought by Victor and those manufactured for Summit were substantially different, and could not be considered as the same lathes, necessarily means it found no bodily appropriation." In other words, with or without modifications, the two lathes were substantially different and therefore no reverse passing off occurred. To the extent modifications reduce similarity, they'd necessarily attenuate any Lanham Act claim. Also, the Questioner never mentions how he or she intends to market the product. Without the facts re marketing, you can't conclude there'd be any passing off.

Daniel Nathan Ballard

Daniel Nathan Ballard

Posted

You missed the point. In Summit, the lathes the defendant purchased from the Chinese manufacturer and resold in the U.S. were NOT the same lathes that the plaintiff purchased from that same Chinese manufacturer and resold in the U.S. The allegedly infringing products were differently appearing right from the get go -- the Defendant did not change them a lick. The defendant also bought them unbranded and put its own brand on them before resale. The "substantial similarity" analysis in this case was done only to determine if the defendant was selling "another's product" as its own. It wasn't -- because the products were different -- and so there was no consumer confusion and so no infringement [let alone no reverse passing off which, ultimately, was not even at issue because the defendant was not selling the plaintiff's product]. I strongly suggest that you do not take away from Summit the rule that it's lawful for a person to buy another's branded product, modify it so that it's substantially different, and then sell it under a different brand.

Vance Ashley Woodward

Vance Ashley Woodward

Posted

The unqualified quote is: "The district court's conclusion that the lathes bought by Victor and those manufactured for Summit were substantially different ... necessarily means it found no bodily appropriation," (i.e. not reverse passing off).

Daniel Nathan Ballard

Daniel Nathan Ballard

Posted

We'll have to agree to disagree. There can be no reverse passing off when the alleged infringer does not sell another's product as its own. In Summit, the court found that the alleged infringer did not sell another's product but rather a different product.

Posted

I completely agree with the other attorney answers. Just to build on their responses, trademark rights are not limited solely to brand names such as Fender or Stratocaster. There is also such a thing as trade dress rights which can protect the way a product looks, which may very well exist with respect to the shape of the Stratocaster guitar. Thus, simply removing the Fender Stratocaster branding would likely not get around these issues. Therefore, as Mr. Ballard advised, the best you could probably do would be to sell such a guitar as a used, customized Fender Stratocaster. However, you should still consult with an intellectual property attorney so that they may better advise you based on the specifics of your situation.

The above response is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyze this matter differently (i.e., reasonable minds can always differ), especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.

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