Among diving aficionados, no
topic is more hotly debated than
the sales of discounted diving
equipment by mail. To witness the
debate, you only need to tune in
to the maze of Internet dive
forums, where hardly a week
passes without someone asking
where to buy, say, a Scubapro
regulator on the cheap. He'll be
barraged with responses that
range from vitriolic criticism for
destroying his local dive shop to
telephone numbers and website
locations where he can save 25
percent to warnings that there will
be no warranty card with it, the
equipment will be defective, or he
won't be able to get it serviced.
Dive shops deplore the
discount houses. They counter by
emphasizing their personal
service and trying to get manufacturers
to guarantee that they
won't condone mail order discounts
of their equipment. Some
manufacturers do deal exclusively
with dive shops, while others say
they do but turn a blind eye
toward the grey market -- that
clandestine market where people
ostensibly purchase gear to retail
to consumers only to turn around
and job it to mail order companies.
The mail order dive business
has been around as long as diving.
As a kid, I bought my first dry suit
-- they didn't have wet suits or
even dive shops then -- in the late
50s through a U.S. Divers mail
order catalogue. When Skin Diver
magazine became the prominent
publication for divers in the
1960s, it carried the forerunner of
today's mail order ads. In the
1970s, Skin Diver carried more
elaborate mail order pitches for a
range of gear from Honest Archie
at New York's Central Skin Diving
and others. In the next decade,
mail order underwater photo gear
ads proliferated and companies
like Adorama that originally
specialized in land cameras
expanded into diving gear.
Many dive stores registered
their protest by refusing to carry
Skin Diver magazine. In 1990,
Performance Diver raised the
ante by developing a mail order
dive gear catalogue to supplement
its mail order bicycle business. By
1996, according to an estimate by
the Scuba Retailers Association,
the mail-order business was taking
four to six percent of the $400
million in sales made by the dive
industry.
All this has not been free of
legal hassles. The most prominent
suit was filed three years ago,
when the Justice Department sued
the Scuba Retailers Association.
The government claimed that, in
1992, the SRA told snorkel
manufacturer Divaire that the
Association's trade magazine
would carry a critical article about
the company and that the industry
would blackball their products
if it did not stop selling snorkels
through the mail. According to
the complaint, Divaire soon
halted its mail order initiative.
The complaint further
alleged that Association representatives
told Rodale's Scuba Diving magazine that 450 member stores
would not carry the magazine if
they accepted ads for scuba gear
mail order houses. The Department
alleged that, because of the
pressure from the Scuba Retailers
Association, Rodale decided not
to accept mail order ads. At the
time, Assistant Attorney General
Anne K. Bingaman said that the government's lawsuit sought "to
ensure that consumers can get
scuba equipment through the
mail as well as from dive shops" so
divers can find "the best prices
and quality a competitive market
can deliver."
Scuba Retailer's Association
Executive Director Jim Estabrook,
owner of United Divers in
Somerville MA, acknowledged
that, while an individual member
might have said something, "there
was no boycott, no nothing." He
claimed no wrongdoing and said
the SRA was not opposed to
mail-order sales. But the suit was
never heard. After running up
$50,000 in legal bills, an amount
roughly equal to its annual
budget, the SRA closed its doors.
As of today, there are no ads in
Rodale's Scuba Diving.
The latest skirmishes began last
April, when Johnson Worldwide
Associates, the owner of Scubapro,
sued Leisure Pro, a major mail
order supplier of dive gear, and
Cindi Walters, a past DEMA board
member who does business as Cal
Pacific Manufacturing. While the
primary charge is that Walter
manufactured counterfeit and
dangerous Scubapro SeaHawk BCs
and Leisure Pro sold them, other
elements of the lawsuit may affect
more people.
The basic charge of the
lawsuit, taken from documents
filed by JWA, alleges that:
From 1995 until 1997, Cal
Pacific was JWA's manufacturer
for the SeaHawk BC, using tools
belonging to JWA. In September,
1997, JWA informed Ms. Walters
that it was moving its production
to another facility and expected
final delivery in December, 1997.
Cal Pacific had possession of the
BC tooling until April, 1998.
From consumers, JWA
learned of counterfeits on the
market and purchased one. JWA's
Product Manager, David McLean,
compared the tooling with the
tools returned by Cal Pacific and
found identical impressions (a
fingerprint, he said) on the
counterfeit BC, tying the counterfeit
BC to the tooling formerly
possessed by Cal Pacific. The
labels on the counterfeit were
printed on material designed by
Cal Pacific and printed uniquely
for them. And Cal Pacific's own
proprietary "Forte" valve fittings
-- which are not on the genuine
model -- were built into the
counterfeit BC.
"There is no doubt," says the
suit, "that Cal Pacific is the
ultimate source of the counterfeit
SeaHawk BCs. Defendants'
method of operating may be that
Cal Pacific Manufacturing produces
the counterfeit SeaHawk
BCs -- using the tools owned by
JWA -- and provides the counterfeit
product to Leisure Pro, which
then sells the counterfeit
SeaHawk BCs to the public. . . .
Leisure Pro knows or is willfully
blind to the fact that the SeaHawk
BC that it offers for sale is a
counterfeit product, and that
Leisure Pro has intentionally and
deceptively advertised and sold
the counterfeit BC as a genuine
Scubapro product."
The discovery of the bogus
BCs occurred when Walton Willis,
Technical Service Supervisor,
received two phone calls from
users seeking service. Both stated
that they had just purchased new
SeaHawk BCs from Leisure Pro
and complained that the BCs had
failed to inflate properly. When
they received their BCs, they
noticed that the valves did not look
the same as the valves on the
SeaHawk BC that they had seen
advertised in the Scubapro catalog
and the inflator mechanisms on
their BCs were different from
those in the catalog.
Willis said, "I informed the
callers that they had not purchased
genuine Scubapro products and
that they had purchased their BCs
from a company that was not an
authorized Scubapro dealer. I
recommended that the callers
contact Leisure Pro about the
product defects."
Tom Allen, Regional Business
Manager for the Scubapro line,
called Leisure Pro and ordered the
SeaHawk BC for $349.95 (suggested
retail is $649). The counterfeit
that arrived was a reasonably
good knock off, "styled identically,
the same color, made from the
same fabric, identical stitching,
identical black strapping with blue
lines, and two of JWA's logos,
including the stylized "S" mark. . .
.It included no instructions,
owner's manual, or registration card -- all of which is always
included with the genuine
SeaHawk BC. Without the instruction
manual, divers may not be
able to operate the BC properly
or safely. Without a registration
card mailed by the purchaser to
Scubapro, purchasers cannot be
provided with warranty service or
be notified of defects or recalls."
They also note that "like the
counterfeit BC that Mr. Allen
received through the mail from
Leisure Pro, the counterfeit BCs
purchased by the Leisure Pro
customers had valves and inflation
mechanisms different from that
on a genuine SeaHawk BC ... and
did not inflate properly. This
defect would make the BCs
impossible to use to properly
regulate buoyancy."
While JWA is concerned
about preventing injuries to divers
using the bogus BCs, they note
also that injury also consists "of
injury to JWA's goodwill." JWA
seeks to protect the Scubapro
image and name "because of the
quality, outstanding reputation,
and extensive warranty and
service associated with Scubapro
equipment. . . .retail prices for
Scubapro equipment are on the
higher end of the price spectrum
for scuba diving equipment." To
maintain that image and advertise
its Scubapro products, JWA spent
$582,162 on advertising in 1996.
Also at stake is copyright
protection. While they allege that
their copyright was infringed
upon by Cal Pacific, they say
"Leisure Pro has intentionally and
willfully infringed on the copyrights
in the photographs and text
appearing in the 1996 and 1997
Scubapro catalog by taking the
photographs and text from the
Scubapro catalogs and reproducing
them in its own Leisure Pro
mail order catalog."
Leisure Pro responded
publicly in early May, saying "we
are justifiably proud of our long
and well-established record of
sales and services in genuine
brand name products at most
competitive prices. This has
angered some of our competitors
and manufacturers alike.
"Recently, we purchased in
good faith Scubapro SeaHawk
BCs from Cal Pacific Manufacturing.
This company was one with
whom we had dealings in the past
and had found to be reliable and
who manufactured genuine BCs
for Scubapro. We are now being
advised that they are counterfeit
Scubapro SeaHawk BCs. This is
the first time in our history that
we have ever discovered that
goods that we sold are not genuine.
We are presently helping
Scubapro to resolve this matter
with them and with Cal Pacific.
We have no interest in selling
anything less than 100 percent
genuine merchandise.
"We must emphasize that the
counterfeit product at issue as
identified by Scubapro consists
solely of the small number of
Scubapro SeaHawk BCs that we
offered for sale and not any other
Scubapro product or any other
brand name product sold by
Leisure Pro."
We called Cindi Walters to
discuss the suit with her, but she
has not returned our calls.
Eugene Mendelorts, President of
Leisure Pro, said that Leisure Pro
was settling with each side individually
and would soon be out of
the suit, leaving only Walters in
contention. "We are just an
innocent customer," he said, "that
assumed it was a Scubapro
product that we purchased."
JWA's Guy Miller acknowledged
that they are negotiating.
JWA has received a restraining
order permitted them to inspect
Leisure Pro's and Cal Pacific's
records to determine if there are
more bogus BCs on the market
and who owns them. In addition,
they are suing for unspecified
treble damages.
There's an ancillary issue
here that isn't involved in the
legalities. How did Leisure Pro, an
unauthorized dealer, get
Scubapro goods in the first place?
After all, the suit states:
"Scubapro sells its equipment
only through authorized retail
dealers and does not authorize its
dealers to sell by mail order.
Scubapro requires that dealers
sign dealer sales agreements
prohibiting the dealers from
selling Scubapro equipment on
the wholesale market, wherever
such contractual restrictions
comport with local law. . . .
"Some of the Scubapro
equipment that Leisure Pro sells
is obtained through wholesale
channels from authorized
Scubapro dealers in the United
States and throughout the world,
in violation of the dealer sales
agreements with plaintiff which
prohibit wholesale dealing. On
information and belief, Leisure
Pro approaches authorized
Scubapro dealers in the United
States and throughout the world
and induces them to breach the
terms of their dealer sales agreements
by selling Scubapro products
to Leisure Pro on the
wholesale market. . . ."
So Leisure Pro claims it has
legitimate Scubapro goods for
sale, and Scubapro admits that,
although it does not authorize its
dealers to sell on the wholesale
market, "some ... Scubapro
equipment that Leisure Pro sells
is obtained through wholesale
channels."
Just where does it come from?
More about that next time . . .
-- Ben Davison