Update on the Canon USA vs Grey Market Retailers Legal Action

[Canon Rumors]

According to Photography Bay, Canon USA has filed an amended complaint against F&E Trading (BigValueInc, Electronic Valley & Others).</p>
<p>Photography Bay explains the amended complaint:</p>
<blockquote><p>In its Amended Complaint, Canon USA doesn’t really add on any additional egregious actions, but rather takes aim at pinning the alleged misconduct on Albert Houllou, who appears to be the principal owner/operator of F & E Trading.</p>
<p>As someone who used to practice corporate law, I can tell you that it is always a big win to get an individual (typically an owner or executive) on the hook for the wrongdoing (aka “piercing the corporate veil”). This allows the plaintiff (<em>e.g.</em>, Canon USA) to hold a person (not just a company) personally liable for the wrongdoing. If you can get at a person’s assets, then you can apply a whole lot more pressure in settlement negotiations or drive them into bankruptcy.</p></blockquote>
<p>According to Photography Bay, the following YouTube video is being cited by Canon USA as proof that Albert Houllou is the controlling party for all of the companies’ actions.</p>
<p><iframe src="https://www.youtube.com/embed/i1i-R563tdg" width="728" height="409" frameborder="0" allowfullscreen="allowfullscreen"></iframe></p>
<p><a href="http://www.photographybay.com/2015/12/06/canon-v-gray-market-retailers-lawsuits-update/" target="_blank">Read the full breakdown</a> and view the amended complaint at Photography Bay.</p>

 

[Loswr]

If Albert is not smart, that may soon be the case as well.

 

[takesome1]

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes) and local government’s should do more to tax imports in such a way so there’s no gain in buying gray imports. This is a fair way for everyone to be on an even playing field.

Indeed. Canon USA has created this problem with the introduction of MAP but also, Canon has this problem globally because (for example) cameras are cheaper in the USA than in the UK.

So the US government should raise taxes to match the UK's?

There are already laws to make sure the tax man collects his share when bring things through customs.
You can be sure the tax man will get his share. Adding taxes to balance prices is .....idiotic.

 

[Valvebounce]

Hi takesome1.
I think the implication is that if Canon sold the cameras for the same price wherever they were headed, then the local government be that UK, USA, India etc made sure that individuals and grey market importers were taxed the same as the main importer (which I'm sure is their aim) then the grey market would be far less attractive. The camera would still be dearer in the UK than the USA as our taxes and levies are higher, but it would not be worth the hassle and warranty risk to save a much smaller amount.

Cheers, Graham.

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes) and local government’s should do more to tax imports in such a way so there’s no gain in buying gray imports. This is a fair way for everyone to be on an even playing field.

Indeed. Canon USA has created this problem with the introduction of MAP but also, Canon has this problem globally because (for example) cameras are cheaper in the USA than in the UK.

So the US government should raise taxes to match the UK's?

There are already laws to make sure the tax man collects his share when bring things through customs.
You can be sure the tax man will get his share. Adding taxes to balance prices is .....idiotic.

 

[takesome1]

Hi takesome1.
I think the implication is that if Canon sold the cameras for the same price wherever they were headed, then the local government be that UK, USA, India etc made sure that individuals and grey market importers were taxed the same as the main importer (which I'm sure is their aim) then the grey market would be far less attractive. The camera would still be dearer in the UK than the USA as our taxes and levies are higher, but it would not be worth the hassle and warranty risk to save a much smaller amount.

Cheers, Graham.

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes) and local government’s should do more to tax imports in such a way so there’s no gain in buying gray imports. This is a fair way for everyone to be on an even playing field.

Indeed. Canon USA has created this problem with the introduction of MAP but also, Canon has this problem globally because (for example) cameras are cheaper in the USA than in the UK.

So the US government should raise taxes to match the UK's?

There are already laws to make sure the tax man collects his share when bring things through customs.
You can be sure the tax man will get his share. Adding taxes to balance prices is .....idiotic.

It sounds like your premise is that the grey market pay different taxes. I doubt that is thee case.

Although the same mentality that works to bring grey market items would also work to game the import system.

 

[PureClassA]

Your first reaction should not be "Well, government should...." No. Secondly Im still confused by this whole thing. I need to read up on it more. Why can't Canon USA simply just refuse warranty covered service for products not purchased through authorized dealers? Yes, they will still repair it, but it wont be free (under warranty). What the heck am I missing here? Wasnt the issue with Canon USA losing money repairing grey market stuff under warranty? Just stop.

 

[beforeEos Camaras]

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes) and local government’s should do more to tax imports in such a way so there’s no gain in buying gray imports. This is a fair way for everyone to be on an even playing field.

Indeed. Canon USA has created this problem with the introduction of MAP but also, Canon has this problem globally because (for example) cameras are cheaper in the USA than in the UK.

So the US government should raise taxes to match the UK's?

There are already laws to make sure the tax man collects his share when bring things through customs.
You can be sure the tax man will get his share. Adding taxes to balance prices is .....idiotic.

No, Canon USA should raise its prices so that theirs match overseas.

really you want to pay more? I do all my buying at a brick and mortar store yes Dilbert full retail plus a 7% tax I could cross state line to newhamshire and pay zero tax but how dose that help my state with its taxes? in the uk you got a higher price plus vat its not the same

 

[takesome1]

What the heck am I missing here? Wasnt the issue with Canon USA losing money repairing grey market stuff under warranty?

But they do not stop. You bought a Canon product and they stand behind it. Otherwise they get the reputation of not taking care their product. I know of no one that they refused a repair because of grey market, it would be bad business.

What you mention is one of the reason for the law. By controlling the supply chain Canon can control their warranty process as well. They can put a structure in place to protect their reputation by fixing products that need warranty. The grey market suppliers undermine Canon's warranty structure to make a few dollars.

 

[takesome1]

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes) and local government’s should do more to tax imports in such a way so there’s no gain in buying gray imports. This is a fair way for everyone to be on an even playing field.

Indeed. Canon USA has created this problem with the introduction of MAP but also, Canon has this problem globally because (for example) cameras are cheaper in the USA than in the UK.

So the US government should raise taxes to match the UK's?

There are already laws to make sure the tax man collects his share when bring things through customs.
You can be sure the tax man will get his share. Adding taxes to balance prices is .....idiotic.

No, Canon USA should raise its prices so that theirs match overseas.

really you want to pay more? I do all my buying at a brick and mortar store yes Dilbert full retail plus a 7% tax I could cross state line to newhamshire and pay zero tax but how dose that help my state with its taxes? in the uk you got a higher price plus vat its not the same

I do not know which idea is more idiotic.
Raise the taxes to match.
Or raise the prices to all be the same so people pay more.

 

[Chaitanya]

Hi takesome1.
I think the implication is that if Canon sold the cameras for the same price wherever they were headed, then the local government be that UK, USA, India etc made sure that individuals and grey market importers were taxed the same as the main importer (which I'm sure is their aim) then the grey market would be far less attractive. The camera would still be dearer in the UK than the USA as our taxes and levies are higher, but it would not be worth the hassle and warranty risk to save a much smaller amount.

Cheers, Graham.

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes) and local government’s should do more to tax imports in such a way so there’s no gain in buying gray imports. This is a fair way for everyone to be on an even playing field.

Indeed. Canon USA has created this problem with the introduction of MAP but also, Canon has this problem globally because (for example) cameras are cheaper in the USA than in the UK.

So the US government should raise taxes to match the UK's?

There are already laws to make sure the tax man collects his share when bring things through customs.
You can be sure the tax man will get his share. Adding taxes to balance prices is .....idiotic.

Prices of Canon(also Nikon, and Tamron) camera products in India are exactly the same as that of US which has made grey market products here unattractive option. Also the prices are low even after the fact that India also has tax structure similar to UK.

 

[Talley]

I read somewhere that Bigvalue/Getitdigital all buy from adorama/BHphotovideo etc and that is the reason they are coming w/ USA warranty cards.... They buy so much they get deep discounts and then they split the kits up and sell the lens separate and the camera body separate.

Really if they are not authorized dealers then how can Canon even go after them?

Also... thats a ton of money in that warehouse eek.

 

[unfocused]

There's a reply on photography bay that says:

I think global prices should be much more equal (without taxes)...

The cost of the physical product is only one expense. Without having access to their books it is impossible to know how much of the price differential can be traced to differences in regional costs. Canon Europe has to pay local labor, advertising, distribution, repair, local taxes on their facilities, rent or purchase cost for those facilities, etc. etc. etc. Higher prices in Europe may, to some degree, reflect higher expenses.

 

[unfocused]

I read somewhere that Bigvalue/Getitdigital all buy from adorama/BHphotovideo etc and that is the reason they are coming w/ USA warranty cards.... They buy so much they get deep discounts and then they split the kits up and sell the lens separate and the camera body separate.

Really if they are not authorized dealers then how can Canon even go after them?

Also... thats a ton of money in that warehouse eek.

Apples and oranges. Some authorized dealers do sell excess inventory to unauthorized dealers, who in turn sell the product below MAP. Those products came into the U.S. Legitimately and the wholesale cost reflects Canon USAs costs.

That's not what this lawsuit is about. Canon is specifically targeting grey market dealers who circumvent the U.S. Distribution chain and then freeload on the Canon USA Infrastructure. Two different issues.

 

[Roo]

If the video is correct, then it seems that F&E Trading are direct importing and I'm guessing Canon USA couldn't get remedy under the parallel import laws with CBP so they've gone it alone in the litigation.

http://www.inta.org/Advocacy/Documents/INTA%20Trademark%20Owners%20Guide%20to%20Parallel%20Imports%20in%20the%20United%20States.pdf

 

[AvTvM]

If Canon were to spend as much attention and resources on improving their sensor tech as they are on litigious action, they would sell many more cameras with better sensors and IQ than any competitor ... and make much more money than by going after a few direct importers.

 

[dash2k8]

But Canon already has the top sales in DSLR cameras by a large margin so I'm sure they don't care about saving money on lawsuits in order to sell "many more cameras."

As for the warranty thing, Canon still repairs broken parts but charges a fee just for taking in the item. The cost of parts and labor also go up exponentially. I remember a piece of rubber stopper on the side of the 1Ds3 cost $15USD. The thing was 1cm x 0.75cm.

 

[Khufu]

Okay, I just want to throw some bits into the mix. Not a direct reply to peoples posts but, first off, a bit of "consumer perspective":

I bought my 5D3 for £1800, not £3400.
The latter was the UK Street Price at the time at 'Jessops', the standard go-to place for photography goods. The former price is what I paid, via bank transfer and avoiding PayPal/Transaction fees. I challenge you all to look at those above figures, do all the mathamaticising you please, and NOT come up with the answer "wtf?"

I don't really see what the debate here is. Corporations like Canon are simply trying to milk the market(s) for every penny they can, as a good Capitalist pimp does. They're in a pissy because globalisation isn't all on their terms, or not just yet, it isn't. They've got scary lawyers and 21st Century Orwellian culture on their side so I'm sure it'll all work out peachy!

What appears to me to be the issue for Canon is simply that the values of various economies and territories aren't on level playing fields and we're all able to peek over the fence much easier now... They'll figure it out; bigger fences, scarier security guards, larger trolls and taxes to cross the bridges, whatever...

But really... £1800 or £3400? Yeah, warranty invalidity threats really kept me up all night on that one.

Ps. No, I don't think taxes come close to being a part of this debate.

 

[Valvebounce]

Hi takesome1.
I'm really not naive enough to think that grey market items attract less taxes than legitimately imported items, though I do suspect that there are loopholes that grey market importers may exploit, also they often only have a warehouse somewhere (which may be in a development area here in the UK which will afford all sorts of rebates on local taxes) not a high street shop which attracts severe local taxes!
I really don't know the solution, I know it is not in taxing things to the same price point.
It might start with Canon looking at the source of the grey market, but then Canon are selling all the items and getting their wholesale income so why care about regional suppliers seems like the problem here.

Cheers, Graham.

It sounds like your premise is that the grey market pay different taxes. I doubt that is thee case.

Although the same mentality that works to bring grey market items would also work to game the import system.

 

[martti]

As far as I have understood, Canon is perfectly capable of running its business and taking care of their part of the deal. If consumers get products at better prices despite the game they play, I see nothing wrong with it.
We take care of our money, they take care of theirs. Should we the consumers start defending the rights of a huge international company? Even the thought of it makes me chuckle...

 

[Tony5787]

I read somewhere that Bigvalue/Getitdigital all buy from adorama/BHphotovideo etc and that is the reason they are coming w/ USA warranty cards.... They buy so much they get deep discounts and then they split the kits up and sell the lens separate and the camera body separate.

Really if they are not authorized dealers then how can Canon even go after them?

Also... thats a ton of money in that warehouse eek.

I'm not sure about their US model items but I ordered a 7D Mark II that's imported and I was told that they import directly through Canon International. Of course my camera matches Canon's claims that they're counterfeitting serial numbers on the cameras as my camera's physical number is way off from the one in the EXIF data so that seems doubtful. I have no idea why they do this but it's really shady. Trying to return the item has been the biggest pain too because the lawsuit came out like two days after my 30 day return policy expired. Thank god for PayPal and their 180 day policy.