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Winning Copyright Lawsuit, KMG Going After Freak Out Knockoffs

10/22/2014

By Timothy Herrick

Photo courtesy of KMG

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A ruling by a Holland court may mean new legal actions against some midway providers. 

The Freak Out is a popular swing ride made by KMG, a manufacturer of fair rides headquartered in the Netherlands. The Freak Out, a smaller version of the company's Afterburner, swings back and forth up to a 120 degree angle and accommodates 16 riders. The ride is self-contained on one truck, requires only two people and four hours for set up. One of the most popular KMG rides, there are 50 Freak Outs operational worldwide, of which 19 are in the U.S. 

The Freak Out is so popular, it's being knocked off.  Peter Theunisz, Sales Manager, KMG, says there are 20-25 copies of the Freak Out in circulation throughout the world, being manufactured by factories in Poland, Hungary, Czech RepubliPhoto By KMGc, Bulgaria and Asia.  

According to Theunisz, on Thursday October 2nd the Dutch Court decided to conclude that the 'Freak Out' is protected by copyright law and that the Czech copy (named Hang Over) is infringing on that copyright. KMG holds a patent on the Freak Out in several countries, including the U.S. Manufacturers of the copies were attempting to bypass the patent by "reverse engineering" the ride, but now they are reproducing the identical presentation - a compellingly trippy combination of lights and day-glow colors. The Dutch ruling validates that the look of the Freak Out is intellectual property, and that the presentation is integral to the value and uniqueness of the ride.


Six months ago, KMG began legal action in the Netherlands when a midway provider brought a Freak Out knockoff, manufactured by the company in the Czech Republic, into the country. The judged ruled that "style effects, model, used techniques, colors and decorations are copied 1-on-1," said Theunisz. "According to the judge the manufacturer and owner [of the  ride]  have not investigated possible solutions to building a similar ride, nor have they attempted to make this ride look distinctively different than the KMG 'Freak Out'."

In addition, the verdict stated that the defendant pay all trial expenses, and any future operation of the Freak Out copy in the Netherlands will result in a 20,000 Euro fine "every day the ride is open to the public," he said. 

The favorable ruling means KMG will pursue manufacturers and purchasers of copy cat Freak Outs throughout Europe and elsewhere. Theunisz insists KMG is not after remuneration so much as the need to preserve his company's hard-earned integrity. "We are protecting the machines we invent and design and create. What we develop meets all KMG standards, which are the highest in the industry. What copycat manufactures are doing is trying to take advantage of the good image of the Freak Out, where riders get the same feeling that is similar to the KMG ride, but not up to our high standards." 

From watches to DVDs, knockoff manufacturing takes place in many industries. When it comes to outdoor rides, reverse engineering a ride to create a bootleg version can sometimes mean bypassing safety features inherent in the original design.  The differences between a fake and authentic product may sometimes only be minor in details, when safety precautions are overlooked in manufacturing large machines like outdoor amusement rides, lives are at risk, as well as the public confidence in the safety of all midway rides.

Theunisz relates a story about a fatal incident caused by a Freak Out knockoff on a fair in Spain. "A seat snapped off, from bad welding and inferior quality materials and three people were instantly killed, and a fourth died after five weeks," he said.  "For an entire day, all KMG Freak Outs over the world did not run and were inspected.  But it wasn't a KMG ride that caused the accident."

According  to Theunisz, the Freak Out copy involved with the Spain accident was also made by an Eastern Europe copycat the Dutch court ruled against.
 
For more than 18 months - prior to even the beginning of the Netherlands proceedings - KMG has been attempting to have the companies that have purchased the copies "cease and desist" using the rides, or to sign a licensing agreement, which according to Theunisz, "would require a safety inspection of the unit to ensure it is up to our standard of safety, but ...they don't even want to do that." 

KMG has hired the law firm, The Sheehan Firm PC, based in Carry, Ill., to pursue purchasers of Freak Out copies in the U.S.  While there has been no U.S. court action yet by KMG against U.S. owners, Tom Sheehan, president of the law firm, said the amusement companies in the  US operating the knockoffs have  "been long aware of KMG's concerns."

Legal action against these companies now seems imminent. According to Sheehan, he and his client, "are weighing the options " regarding what state to file a lawsuit in as well as whether state or federal action will be more effective.  Sheehan emphasized that KMG is adamant about ceasing the purchase of illegally reproduce copies of their amusement rides in the U.S., a stance only strengthened by the recent Dutch court ruling.
 
"KMG is going  to aggressively defend their intellectual property rights, anywhere in the world, in the Netherlands or here in the United States," said Sheehan. He added that the Dutch court ruling "proves that the intellectual property claim by a ride manufacture is very defensible."

While courts in other European member nations are bound to honor the Dutch Court ruling, U.S. courts are under no such obligation.  "How persuasive that specific ruling will be is up to the judge," admitted Sheehan.

However, Sheehan points out that he brought similar cases against other ride manufacturers. "I've prevailed over a number of Chinese Manufactures in Florida who were attempting to sell copyright infringement devices at the International Amusement Park Association (IAAPA) trade show in Florida." 

He added, "people have to be cautious regarding purchasing rides that may be violating property infringement laws. Manufactures are compelled to protect their work. Just because something looks identical, doesn't mean that the safety mechanisms are identical. That is absolutely the concern and it's bad for the entire industry. It not only hurts the image of the manufacturer, but can be damaging to anyone else who owns a genuine article. The potential ramifications are enormous." 


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