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View Full Version : Trying to determine meaning of distributor



SmacklemeElmo
07-26-2005, 01:26 PM
Hello. I am not sure which topic this question falls into but it is somewhat related to import/export. So I hope this is ok to ask here.
My question is as follows:
Lets say a company in country X manufactures portable gizmobops. We will call this company Gizmobop Inc. Now a company named Iwanagizmo is located in country Z. If the Iwanagizmo company resales the Gizmobop product under the Iwanagizmo name. Would the Iwanagizmo company be considered a distributor?
Also by Iwanagizmo putting their corporate name and logo on Gizmobops product. Does this transfer ownership of product design? Furthermore how would responsibilty for product quality be distributed? I thank you in advance for any insight that you may provide.

pete
07-26-2005, 04:50 PM
Basically what you are talking about is a private label arrangement. All of that you mentioned could be negotiated and agreed upon. Other than the actual design (patent) rights, in most cases.

Product lialbility could go either way. The manufacturer may replace defective items. Or not. Could give a "defective allowance" and the buyer eats the defects.

Virtually all of it is negotiable. Some manufacturers may not negotiate, particulary if there is a good demand and they can sell their way or the highway, but in most cases things can however it is agreed upon.

Not pat answers.

SmacklemeElmo
07-28-2005, 12:37 AM
Thanks for the reply. What you said helps. But let me clarify my question. An issue was raised between some folks in a disussion group.

The issue was something like this:
A certain USA company distributes bicycles under their own name. Yet this product is manufactured by another company in China. A design error was found in the bicycle. This error was pointed out to the US company, and their response was that they are just a distributor, and because of this, they were not responsible for such errors. Also they felt any complaints should be made to the Actual manuafacturer.

That is the part that really baffles me. When someone purchases the bicycle under their trade name, they end up with a bike that has their Logo on the bike, all manuals have their name. The real producer of the bike is never mentioned anywhere in the provided documentation. Now here is the real tricky part.

Since the US company neither makes the bike or retails it, they seem to have a real untouchable clause. I would think once a company puts their stamp on a product, they would have to assume responseability for the product. Pardon my lack of knowledge in this area. I would really appreciate some insight.

Thanks in advance

pete
07-28-2005, 08:26 AM
While not an attorney, I would agree with you. I do not see how they could escape liability in a case like that.

If there is sufficent damages, I'd contact an attorney and you might also contact the Attorney General in whichever state they are headquartered.

SmacklemeElmo
07-29-2005, 12:56 AM
Oh please don't misunderstand. I have no interest in pursuing this through the legal system. Like I had said this was just a discussion on a forum. My reason for this post was more on the lines of understanding the companies point of view. In the discussion both points of view were givin. I found the argument that they were just a distributor was very weak, and was passing the buck. But once again thankyou for your response, it did provide me some insight.

SmacklemeElmo
08-03-2005, 03:59 PM
But hey more comments are welcome.

David_King
02-19-2006, 06:10 AM
Oh, I think your story is teaching me a important terms in an agent agreement or distribution agreement.

We should consider this during agreement.

But I donot know how to write in words....Can you give some words?

darelle4
04-02-2014, 08:51 PM
Well the fact of the matter is as long as a company is selling a product then they are responsible for the damages. The company can at least try to to work out something with the customer and inform the manufacturer of the fault.