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Reprinted from
Rochester Business Journal
VOLUME 12
NUMBER 21 DAILY EDITION
SEPTEMBER 6, 1996
Lone inventor stands up to mighty
Motorola
 Garry
Haltof scaled the summit of Mount Rainier on Sunday. That feat seems a
mere stroll in the park for the entrepreneur fighting an uphill battle
against Motorola Inc.
The saga
started in 1993, when Haltof invented the "Flip Clip," a cellular-phone
holder designed to mount on a car dashboard.
"As soon
as I saw the idea, it was obvious to me that you could sell these things
pretty easily," says Vern DeWitt, president of Webster Plastics Inc., a
local firm that manufactures the product.
Folks at
Motorola - which makes a compact cellular phone called, not
coincidentally, the "flip phone" - initially were excited about the Flip
Clip, too, Haltof says.
In mid-1994, the inventor met
with Motorola engineers to show off his product. Based on a warm reception
there, Haltof then sent samples of the Flip Clip to several other managers
at the firm.
Meanwhile, Haltof - who runs the
one-man engineering design firm, Haltof Product Design, Inc. - kept
pouring his own funds into the venture.
He ponied up the price of a
booth at Wireless 95, one of the largest trade shows for the
cellular-telephone industry. There, Haltof's Flip Clip display caught the
eye of Robert Barnhill, CEO of Tessco Technologies, a distributor of
communications products. Two months later, Tessco ordered several
hundred units and began featuring the holder in its catalog.
By this point, Haltof's
relationship with Motorola had soured.
A manager who earlier had
requested quotes for 50,000 and 100,000 Flip Clips now told Haltof that
Motorola was designing its own cell-phone holder.
Further, Motorola was dragging
its feet on the issue of Haltof's Flip Clip trademark.
Haltof had
filed for the trademark with the U.S. Patent Office in March 1994,
approximately the same time (editor: before) he initiated talks
with Motorola. In mid-1995, the patent office called for oppositions to
the filing, part of the process that allows other firms to contest (the)
trademark(s).
Motorola
repeatedly asked for extensions - Haltof ultimately granted five - before
filing a notice of opposition February of this year.
In what Haltof
calls "really dirty pool," Motorola during this period had filed trademark
application for the "Flip Clip" name in Mexico and Canada. That move bars
Haltof from selling his product there under that name.
Haltof says Motorola has offered
to buy the the "Flip Clip" name. But the $7,500 they proposed pales
compared to more than $50,000 Haltof has invested in marketing materials,
trademark application fees and other expenses.
Webster Plastics also has
invested "a lot" in the Flip Clip, from engineering time to manufacturing
equipment, DeWitt says. "I'm on no rush" to see a payoff, he adds. "But I
can wait one heck of lot longer than Garry can."
Yet for Haltof, the struggle has
become "as much a moral issue now as it is a business issue," DeWitt
muses.
Business certainly plays a key
role, however.
DeWitt notes that the "flip"
name gives Haltof's product a big advantage. The term refers to cellular
phones with mouthpieces that flip down. Motorola uses the word to describe
its cell phones; so do other cellular phone makers with similar feature,
including LM Ericsson A/S of Sweden.
Nevertheless, Motorola is coming
down hard on anyone using the "flip" moniker, not just Haltof. But while
multinational conglomerates like Ericsson can marshal legions of corporate
attorneys to fight off Motorola's assault, Haltof cannot.
Indeed, his energies are consmed
by the trademark bout and getting the Flip Clip off the ground. And while
funds are starting to flow from Flip Clip sales, "without my wife's income
I'd be on the street," Haltof says.
So he decided to take his story
to the street - as in The Wall Street Journal.
The publication ran a lengthy
story about the dispute in its August 27 issue, headlined "Inventors Heed
Tale of Flip-Phone Flip." After the story ran, Haltof spoke to with
Motorola attorney Jonathan Meyer, who also was interviewed for the
article.
"He said I'd
caused a lot of headaches for a lot of people at Motorola, which of course
was my exact goal, " Haltof reports.
Haltof
describes his strategy this way: "I need to stay in their face."
(Facing
potential legal action) Haltof would welcome an (out of court) solution.
"I would not like to have this
fight," he insists.
Though good-humored about the
whole affair, Haltof has no intention of giving up.
The case could take years to resolve, he admits. And
it does sometimes seem that the struggle is endless.
"(I'll feel like) I'm rounding the corner," Haltof
says, "But I'm just walking around a huge multifaceted polygon."
Haltof's Web site is http://www.haltof.com.
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