The lawsuit asserts that Scott Electric participated in false advertising, product disparagement and trademark infringement in violation of federal and state law, and seeks monetary and injunctive relief. The suit specifically claims that Scott Electric reportedly sold counterfeit QO circuit breakers bearing the Square D trademarks and copying Square D designs. As alleged in the lawsuit, testing by Square D has shown that counterfeit electric distribution products pose serious health and safety hazards to innocent customers.
"Square D is committed to enforcing its trademark and property rights and to prevent the sale and importation of counterfeit products bearing its trademarks or designs. Square D will also take appropriate action to prevent product disparagement and false advertising, said Bill Snyder, vice president channel development for the Schneider Electric North American Operating Division.
On April 28, 2006, Scott Electric signed an Agreed Consent Order for Permanent Injunctive and Other Relief to promptly resolve the matter and prevent the sale of counterfeit products. In the short term, the consent order requires Scott Electric to submit to immediate inspection of its entire Square D inventory, including all allegedly counterfeit QO circuit breakers described in the suit. Square D representatives shall conduct the inspection, and identify and take possession of any counterfeit products. Scott Electric has also represented that it intends to recall any counterfeit Square D products. Scott Electric is permanently enjoined from knowingly marketing, selling or distributing any counterfeit Square D product.
Through April 12, 2008, Scott Electric has agreed to notify Square D if it suspects that it is in possession of counterfeit Square D product and fully cooperate with a Square D inspection. If Scott Electric complies with all of the terms of the consent order, Square D will dismiss its lawsuit against Scott Electric with prejudice.
According to Snyder, The swift handling of this lawsuit demonstrates how determined and serious Square D is about putting an end to the counterfeiting of its products. There will be many more battles as part of the larger war Square D intends to wage on counterfeiters. In that vein, one of the more far-reaching terms of the agreed consent order requires Scott Electric to provide Square D with a list identifying all of Scott Electrics suppliers of Square D inventory for the past 36 months. Armed with Scott Electrics supplier list, Square D has every intention of pursuing counterfeiters up and down the distribution chain. Well stop at nothing to preserve the integrity of our products and protect innocent customers from the serious health and safety hazards associated with counterfeit products, Snyder said.