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How Manufacturers Can Avoid Products Liability Suits

Whether your business manufacturers cars, laser-cutting machines, pharmaceuticals, or toys for children, protecting you and your company against products liability actions brought by consumers may seem impossible. You are a business owner that runs your company just like your machines - precise, efficient, calculating, and safe. However, no matter how much careful planning is involved, there are always issues that arise that no one can anticipate. There will always be inherent risks that accompany a manufacturing business, but taking the steps outlined below will help protect you from liability and may also help protect your customers as well.

#1 Allocation and Transfer of Risk

From the very beginning, you should work with an experience attorney who can assist you in drafting documents that will help insulate you and your company from liability. This includes the drafting of hold harmless agreements, which will ensure that suppliers and sub-contractors in the supply chain are responsible for their own negligence and other mistakes. In addition, including financial responsibility statements will ensure that you will not be left financially responsible for others’ mistakes, because another contractor or supplier will have to have certified that they are carrying the appropriate insurance.

#2 Make Safety Paramount from the Beginning  

Safety concerns should be of utmost importance, especially during the design phase. This may seem obvious, but most hazards and risks can often be limited or cut out completely during the initial design phase. Multiple safety reviews should be conducted during the design phase by multiple different employees who can offer different perspectives and ask challenging questions. It is essential to brainstorm all of the different ways this product will be used – and misused, in order to best protect against physical and economic injury. In addition, ensure that your products comply with all government safety standards, as well as though common in your industry. Compliance with these standards will help you further strengthen your argument in the event of a lawsuit that you took all steps necessary to ensure you were manufacturing a safe product. Lastly, your products should ALWAYS contain appropriate and extensive labels. It is better to be over-cautious.  

#4 Proper and Thorough Record keeping  

While it may seem obvious that proper and thorough record keeping is essential to any business, you would be surprised how many manufacturing businesses struggle to keep thorough records, which always comes back to haunt them in a plethora of ways. Keeping solid records not only helps businesses track progress and meet goals, but also helps the businesses comply with relevant regulatory requirements and prepare for litigation in the future. Among other things, you should make sure to keep records of: 1) Design specifications and all orders, including customer final approval of designs, 2) Procedures and instructions for ensuring the product is safe through the manufacturing process and quality control, and 3) A document retention policy, which will ensure all necessary documentation is stored safely in case it is needed in the future

#5 Do Not Forget About or Ignore Feedback!

Do not ignore your customer feedback! Reviewing and responding to customer feedback is not only critical to showing customers you truly care about them and value their loyalty, but also for providing a barometer of how your products are doing and whether there are any safety issues or defects you that you did not manage to catch. This information can help you take steps early on to minimize exposure of any incidents and also to fix the issues before they are exposed on a much larger scale.

While there will always be some unforeseeable issues that will arise, you should take the above steps and work with an experienced attorney to ensure that you have covered all of your bases. This will help your business grow and be more prepared for the future.

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Trademark Basics for Small Businesses

A trademark is a word, sound, design, or expression that is used to identify the source of the goods or services a company provides. Eventually, a company’s marks will become recognizable by consumers and consumers will begin to associate a certain level of quality and reliability with the products. While it may not be at the forefront your mind as a small business owner, acquiring trademark protection for your brand is of utmost importance, and thus is something you should prioritize in your business plan. Registering your trademarks early on will not only ensure that the brand you have worked hard to build will continue to grow and be safe from theft and misuse, but also will help insulate you and your business from any potential trademark liability.  

Although some trademark issues may be quite complex, the misconception that obtaining trademark protection is unnecessary, too expensive, or too difficult dooms many small business owners and their intellectual property assets. In reality, trademark registration is a standard process for an experienced attorney, and the cost of registration is only a fraction of what your mark will undoubtedly be worth, with application fees totaling only around $200-400. The application process is also relatively short,  generally taking about six months, although this could be longer or shorter depending on the complexity of the situation. In fact, you can begin the trademark registration process before you have even started offering your services or selling products, as long as you certify your intent to use the marks in commerce.  

It is completely understandable that you, as a small business owner, have plenty of other issues on your mind, but neglecting to obtain trademark protection is a poor decision for you and your business. On your end, obtaining trademark protection is as simple as choosing what you would like your trademarks to be. What will the name of your brand be? What will your logo look like? If you can answer these questions, an experienced trademark attorney can help you plan and handle the rest of the work for a modest flat-fee, including: 1) conducting a preliminary search for similar marks that have already been registered, 2) filing your application with the U.S. Patent and Trademark Office, 3) monitoring the status of your application and responding to the USPTO with any necessary additional documentation, and 4) helping your mark overcome a registration refusal.

We here at Atom Law Group cannot stress the importance of registering your trademarks enough. This is something you must do, and must do early. We are experienced in this field, having filed many trademark applications as well as helped our clients successfully overcome an initial registration refusal. To obtain an consultation regarding your business plan and trademark registration options, please contact us at 312-943-8000. We take an approach tailored to your specific needs  to help you take the proper steps to enable your business to not only have a sound legal foundation, but also to flourish.

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Why Manufacturers Should Stand Their Ground in a Dispute

Another reason mid-size and small manufacturers hesitate to raise a dispute or even defend themselves in disagreements with large buyers is the belief that this may sour the other side from repeat future business.

Interestingly, in many cases where we represent parties involving manufacturers and buyers, the parties actually continue to do business after the litigation. In fact, sometimes, the settlement is structured to require the parties to have future transactions. This is even true among some highly-contentious cases. While this may seem surprising at first, it makes sense. Successful businesses are often ruled by pragmatism rather than emotion. The particulars of a dispute are often confined to facts surrounding a particular product or transaction. Both sides often recognize that the other company has value above and beyond the conflict at hand. They may have had prior transactions that went smoothly and may not want to “throw out the baby with the bathwater” just because of a dispute - even if its a big one. The dispute may involve one particular product the buyer had a bad result with, but the buyer may still have faith in manufacturer’s other products. However, even if the parties never do business again after a dispute escalates, standing your ground may make good sense. Caving into a large buyer only to preserve the relationship sends a dangerous message of appeasement and sets a bad precedent for future dealings. The buyer is likely to get the sense that they will always get their way, even if you think they are in the wrong.

Standing your ground is not only the smarter approach to a dispute, but it is also likely within your budget. In fact, once you have decided to stand your ground, it is far more likely than not that your dispute will end with a sensible settlement. Atom Law Group represents both international and domestic manufacturers in disputes concerning tools, parts and machines. Please feel free to contact our firm at info@atom.law or call to schedule for a consultation with one of our team members at 312 943 8000. Or further explore our services at www.atom.law.

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How Manufacturers Can Stand Their Ground in a Dispute

Mid-size and small manufacturers often hesitate to raise a dispute or even defend themselves in situations where an issue arises with a large buyer or vendor. This blog entry deals with the fact that they are often concerned about the cost associated with a lawsuit (considering their adversary may have far more resources).

The right law firm will accommodate the right client’s financial limitations. The right match is most likely a small law firm, not a large one. A mid-size or small business will much more likely receive higher quality service from a small law firm than a large one. These clients are the preferred clients of small law firms, but are not the preferred clients of large law firms. Obviously large law firms provide quality service… but they target large businesses.  Law firms who have the largest presence in the market are often not a good match for mid-size and small businesses for a few reasons. Their rates are astronomical and are geared for large businesses. Not only does this make them unaffordable for mid-size and small businesses, but it also sends the message that mid-size and small businesses are not their priority clients. Small law firms do not have the massive overhead of their larger counterparts and are able to offer rates that a midsize or small business can afford. In turn, working with a small firm in and of itself will likely put a mid-size or small manufacturer in a position where it can deal with a dispute on a level playing field, rather than being forced to cave in. Perhaps even more importantly, a small business will be a high priority for a small law firm if it is composed of a diligent team. Your chances of receiving direct and personal attention go up significantly, as does your chance of achieving the best result for your case. 

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