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E-Cig Wars

E-Cig Wars

A new e-cig, "1963", claiming to be the original, invented that year, has been fielded by John Cameron, whose inglorious past with TheSafeCig is legendary.

The "1963" is offered by Emperor Brands, a division of Human Health Organization, LLC (as indicated on the Terms of Use page of their website). The "History" page of the site is a statement from Herbert Gilbert, who invented a prototype e-cig device in 1963 and received a patent for it in 1965, but was unable to market it successfully. Touted by a promoter called "Global Resource Broker", Emperor Brands talks as though it is planning to challenge later patents and claim precedence. The "About Us" page of the website states:

"Emperor Brands™ will continue developing its intellectual property through acquisition and in-house development. The company owns the most defensible patent suite in the electronics cigarette industry and will license the assests to third parties, generating secondary revenue streams. Ruyan, an 'IP Troll', has executed a similar strategy. Emperor Brands™ patents and copyrights are positioned to both undermine Ruyan's IP and exceed it in terms of the future market direction. FUNDAMENTAL INTELLECTUAL PROPERTY: Our commitment to developing and protecting our intellectual property ensures continued differentiation and freedom to operate in the industry."

(An "IP Troll" is an entity that acquires patents – Intellectual Property or "IP" – from bankrupt companies and uses them to create income streams. Ruyan was the Chinese company that originally patented Hon Lik's 2003 independent invention of an e-cigarette. Renamed as Dragonite, it sued a group of American companies, including TheSafeCig, for copyright infringement. Britain's Imperial Tobacco bought Dragonite in 2013, allegedly including its intellectual property. In early 2014, Imperial's new Dutch subsidiary, Fontem, sued a group of American companies based on their possession of the Dragonite claim. The list of defendants is for the most part the same, minus TheSafeCig, which no longer exists as such. The Emperor Brands page does not mention Imperial or Fontem.)

Jon Deak was one of the first people to import e-cigarettes into the US from Ruyan, in 2005. He founded TheSafeCig with his brother and sister, and they later asked Hollywood celeb John Cameron to serve as CEO. "When John came to us," says Robert Deak, "he weaved dreams of great success for the company and the family. No door couldn’t be opened with the Cameron name, and Hollywood would fall at our feet." The co-founder goes on to chronicle profligate spending, invitation of highly-paid executives who allegedly did little, and general mismanagement on a monumental scale.

Eventually, formerly loyal customers began to complain of unfilled orders, delays, inappropriate charges, and a host of business lapses. The Better Business Bureau revoked the company's accreditation, and the firm's website disappeared. The Deaks asked Cameron to quit, but he declined. Instead, according to Robert Deak, Cameron claimed the need for a new operating agreement, and got them to sign one. It gave 48% of the company to a certain "Homeland Health, Inc." Since Cameron already owned 3%, this gave him 51%, says Robert Deak. Reportedly, he locked the Deaks out of the warehouse.

On March 7, 2013, Robert Deak reported that "Safe Cig is not out of business but we are in the midst of an internal dispute between us, the Founders, and our CEO John Cameron. This has caused the site to go down and John C. has effectively stopped inventory from leaving the warehouse."

The Deak brothers formed an alliance with a SafeCig customer, The Seminole Tribe of Florida, which had made a large purchase which was allegedly never delivered.  Seminole E-Cigs claimed that its product was basically the same as TheSafeCig's: "The Seminole Brand of Electronic Cigarettes is a 100% independent company from Safe Cig, but since we had manufactured their product, their flavors and technology are the same." It was then that the name SafeCig, instead of the former TheSafeCig, began appearing.

They announced these changes in a YouTube video in which the Deak brothers appeared with Herbert Gilbert and one other person whose identity was hidden by the blurring of his face in the video. Unfortunately that YouTube video is no longer available, but Seminole Electronic Cigarettes is still in business. It would appear, however, that Herbert Gilbert has defected to Emperor Brands, which now seems to own his patent.

Safe Cig no longer has a web presence, a search takes you to a domain sales site. The facebook page exists, but there are no recent posts – browsing it is like wandering through an abandoned warehouse. There is a YouTube channel with no videos uploaded for the past year, but with a link to Seminole. Interestingly, (The)SafeCig does have a presence on Twitter (the logo lacks the article, but the tag has it). There were no tweets between March 2013 (when all the activity described above took place) and March 2014 (last month). But then two tweets directed followers to a site called "Craft Vapery", incorporated in 2013 as a subscription service connecting vapers with a variety of brands, 23 of them, primarily selling liquids. Seminole is not listed, nor is any product called SafeCig or TheSafeCig. Neither (ahem) is Emperor Brand's 1963.

It will be interesting to observe how vapers respond to 1963 once they are fully informed about John Cameron's history with TheSafeCig. And of course it will be important to keep an eye on IP infringement lawsuits. One believes that the American Bar Association has broken out the champagne! [lawOffice]

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