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January 15, 2013

Innovation First seeks action on CVS toy sales

GREENVILLE — A local robotics firm is wanting federal officials to investigate a national pharmacy chain over allegations the pharmacy sold knockoffs — which used stolen technology — of a toy it is developing.

Innovation First International (IFI) in Greenville filed a complaint Monday with the United States International Trade Commission, requesting an investigation be instituted against CVS Caremark for alleged unfair trade practices. The claim against CVS is related to the “Robo Fish” toy, manufactured by Zuru Toys, Inc., and sold in CVS stores.

According to an announcement from Innovation First, the “Robo Fish” toy includes technology developed by the company and its employees that was misappropriated by persons affiliated with Zuru Toys.

“This should come as no surprise to CVS,” said Tony Norman, President and Chief Executive Officer of Innovation First International. “We warned all major retailers last year of the consequences they would face if they were to import the Robo Fish product. Against our advice, this retailer knowingly chose to carry the product line, and will now have to face the legal consequences associated with its actions.”

Officials with CVS Caremark could not be reached for comment Monday.

According to the statement, Innovation First asserts the “Robo Fish” product incorporates technology that was stolen by an IFI engineer and shopped for several months to other toy companies. The engineer ultimately placed “Robo Fish” with Zuru Toys and resigned as head of R&D for Innovation First’s China development team the day of the sale. Innovation First sued Zuru Toys more than a year ago and remains engaged in litigation with Zuru Toys. Major U.S. retailers other than CVS elected not to carry the products. Innovation First plans to release its official version of the Aqua Fish product under the HEXBUG brand this August.

“The toy industry is notorious for encouraging knock-off artists by placing offending products on their retail shelves,” said Norman. “Retailers know the toy industry, but some pretend not to recognize obvious knock-offs or other unfair trade practices. Those retailers bury their heads in the sand and rely on the hollow promise of indemnification from unscrupulous suppliers - a practice that stifles true innovation.”

Innovation First actively files litigation against companies which it believes illegally appropriate its technology. The business reported more than 1,000 successful enforcement actions as of February 2011.

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