Is the Hock Store really done?

[Майор Хаткевич]

I don't know if this was covered elsewhere, but do the Active Duty/Reserve/SDF forces all have exclusive contracts with Vanguard for "official" products, or are there multiple vendors that can be used?

Would it matter in CAP?

[tdepp]

I have always felt that CAP is missing the boat on licensing all the logo's and trademarks that CAP has.  If they signed a 100% exclusive agreement with Vanguard on all CAP branded items, then someone made a very bad business decision.  Vanguard cannot produce or sell every item that someone has figured out to put a name on.  CAP should have taken a lesson from the NFL or NASCAR on how to market a brand.  The NFL and NASCAR make an absolute fortune on their licensed items.  You will notice that they do not have a sole source on any of their items.  Companies have to send in samples for approval and then they are given permission to sell the item after the legal paperwork is done.

I have a friend who makes different advertising items for Disney, Coke, NFL, NBA and NASCAR.  He said he pays from 3% to 15% royalties on the items that he sells.  Every quarter he fills out the forms and sends the various companies their share of the money.  He said that once a year someone may show up to audit his records to keep everyone honest.  If he develops a new item, he sends it in for approval and he goes with it.  All the risk is on him for making and marketing the item.

For Christmas, my son got me a laser cut Civil Air Patrol plaque.  He was so proud that he found a CAP item for dad.  I was extremely impressed with the quality of the plaque.  I looked and Vanguard does not sell these plaques, so I am sure that it is 100% black market.   :clap: 

If Vanguard will not sell an item that we as members want, then someone who wants to take a chance and make the item and then pay a royalty to sell it should be given a chance.  Everyone wins.  We as members have a wider choice of items and CAP makes money on their precious trademarks.

Mash:

There's one major difference between the NFL and NASCAR licensing and CAP licensing: There are millions of people willing to pay for NFL and NASCAR items with TM's of the teams and drivers.  And the NFL, College Licensing, NBA, et al are typically pretty picky about vendors being able to meet quality standards before getting a license.

CAP, in comparison, has 58,000 members.  Millions of Americans are not clamoring for CAP gear.  It's mostly just us members and maybe a few former members and family members.  That is an extremely small market.  That Vanguard considers this worth their while and is willing to pay a licensing fee is remarkable.  So, CAP doesn't have a big line of companies wanting to license or even sell CAP items.

But trademarks are protectable, whether the good or service is desired by many or a few.  The TM owner has the legal right to license or not license their mark.  And they don't have to go after every infringer, but enough that makes economic sense and provides a track record of enforcement so the mark(s) do not become generic and fall into the public domain.

I'm not privy to the decisions that led to our national leadership to decide to sue The Hock for infringement or why they decided to go with an exclusive license with Vanguard.  But what they are doing is not only legal, I would argue it is also good business to find someone willing to license and sell CAP branded goods.  It means there is at least some value in our TMs.  To throw it open to anyone to make or sell CAP TM'd goods would basically mean we think our brand is worthless.  And there would be a huge variation in quality as well.  Is our TM not worth protecting and leveraging?  I think it is.

I too think competition is good.  But CAP has a legal right to exclusively license its marks if it so chooses.  If another vendor wishes to pay a licensing fee for CAP branded goods, then, if it makes economic sense, at the end of the current CAP-Vanguard licensing agreement, that's something our leaders could consider and do.  Would Vanguard agree to a non-exclusive agreement?  Would CAP make more money by licensing to multiple vendors?  I don't know the answers to those questions but I'm guessing those things have been considered by our national leaders.

I don't know how Vanguard determines its price points on items.  How much does licensing add to the cost of goods?  I don't know for sure in this instance.  Generally, the standard royalty rates on clothing and doodads is 5% or so.  (I have some very thick books that detail royalty rates based on goods and services and who is doing the licensing. There can be quite a bit of variation.  But it also depends upon what a willing licensor and licensee will agree to.)  Vanguard seems a little higher on most items than The Hock but Vanguard also had a better selection of items to choose from.  And many seem to think Vanguard's quality was better on many items.  The biggest complaints seem to be their higher shipping costs and slower service. 

And this is not anything that is going to change during the life of the licensing agreement whether members like it or not.  The opportunity, as noted above, will be when the Vanguard agreement is set to expire.  And we've seen that CAP and our vendor will enforce their rights.  Welcome to the real world, fellow babies.  It's how business is done. 

[C/Martin]

I didnt read every post, but I can contribute on the AFFES and Vanguard. My Dad left the Army with 10 years of service. During my dad's E-5 Promotion they were standing inline and one of the guys went along checking the BRANDS on their coats. One man had lost his jacket, but bought one similar very similar he got away with it for a few years. And when they saw it was not form AFES he was refused a promotion. The jacket if he bought form AFFES would have costed a few hundred bucks when he payed 40 to 60 bucks for one exaclty like it.

Also, I saw someone said Vanguard-opoly. Dosnt the FTC try to prevent monopolies. Although I guess with licenses that dosnt matter. But, a question I have is can Tom buy a license?

[Eclipse]

Also, I saw someone said Vanguard-opoly. Dosnt the FTC try to prevent monopolies. Although I guess with licenses that dosnt matter. But, a question I have is can Tom buy a license?

You can only license something the owner is interested in licensing.  When you hold a copyright, it is your option whether and to whom to sell manufacturing rights.

[Hawk200]

I didnt read every post, but I can contribute on the AFFES and Vanguard. My Dad left the Army with 10 years of service. During my dad's E-5 Promotion they were standing inline and one of the guys went along checking the BRANDS on their coats. One man had lost his jacket, but bought one similar very similar he got away with it for a few years. And when they saw it was not form AFES he was refused a promotion. The jacket if he bought form AFFES would have costed a few hundred bucks when he payed 40 to 60 bucks for one exaclty like it.

I doubt that's totally accurate. Any uniform item with the appropriate approval tags is acceptable for wear. A lot of people have spread this rumor for longer than I've been military.

Now if the jacket didn't meet appropriate specification, that would be justification for action. The person wouldn't have been wearing approved clothing. The same applies to badges and other insignia. If they're from approved sources, they're hallmarked.

[tdepp]

Also, I saw someone said Vanguard-opoly. Dosnt the FTC try to prevent monopolies. Although I guess with licenses that dosnt matter. But, a question I have is can Tom buy a license?

You can only license something the owner is interested in licensing.  When you hold a copyright, it is your option whether and to whom to sell manufacturing rights.

Indeed, Eclipse.
C/Martin does bring up a good point.  There is a tension between exclusive licensing and monopoly.  However, basically since the TR administration, the federal government has come down that it is not anti-trust behavior except in a few exceptional situations.  Believe me, I've tried the argument.   

[Spike]

I think everyone here has tried playing lawyer on both sides of the case for too long.

Tom violated a legal request by a Congressional Chartered Organization.  It does not matter how long he "got away with it", it matters that he kept doing it.

The Corporation should go after him with whatever they believe is justified.  In fact, a 2b may not be out of line after the case is settled as well.

The guy did wrong, he knew he was doing wrong, and he got slapped for it.

The Hock will either close altogether or end up selling foreign made ES gear. 

I did feel bad for him originally, but no longer.  If the roles were reversed here (Vanguard breaking the rules), we would all be fighting on Tom's side against Vanguard.

Enough.....back and forth arguing by people who got their law degree from Wikipedia is silly at best, and wastefull at least.   

[davidsinn]

I think everyone here has tried playing lawyer on both sides of the case for too long.
 
Tom violated a legal request by a Congressional Chartered Organization.  It does not matter how long he "got away with it", it matters that he kept doing it.
 
The Corporation should go after him with whatever they believe is justified.  In fact, a 2b may not be out of line after the case is settled as well.
 
The guy did wrong, he knew he was doing wrong, and he got slapped for it.
 
The Hock will either close altogether or end up selling foreign made ES gear.  
 
I did feel bad for him originally, but no longer.  If the roles were reversed here (Vanguard breaking the rules), we would all be fighting on Tom's side against Vanguard.
 
Enough.....back and forth arguing by people who got their law degree from Wikipedia is silly at best, and wastefull at least.  

Legally speaking you are correct. However just because something is legal does not make it right or ethical. This move is the correct one under the law but is a stupid one because it screws the membership. Again.

[Майор Хаткевич]

If it's the law, then it's the law. Tom broke ethical codes by disobeying the law. The law does not protect people like Vanguard, it's there to protect the owners of the property/idea/etc, in this case CAP.

[davidsinn]

If it's the law, then it's the law. Tom broke ethical codes by disobeying the law. The law does not protect people like Vanguard, it's there to protect the owners of the property/idea/etc, in this case CAP.

Oh I was waiting for something like this. There are times when it ethical, moral and encumbent upon decent people to break the law. See fugitive slave laws for an example. Do I think this is a case like that? No, not by a long shot. Yes he broke the law. I'm not trying to say he didn't. I'm not even trying to say he shouldn't be smacked down for it either.

The poor ethics come from NHQ as well for setting this up in the first place. For a non-profit they are pretty greedy. If they were smart they would have opened the licensing up to anyone that can meet an NHQ spec and charge a percentage or flat fee. The unethical action is to set up a monopoly relationship at the expense of the members. 

[Ned]

The poor ethics come from NHQ as well for setting this up in the first place. For a non-profit they are pretty greedy. If they were smart they would have opened the licensing up to anyone that can meet an NHQ spec and charge a percentage or flat fee. The unethical action is to set up a monopoly relationship at the expense of the members.

Really?  Why do you say that?


Now that you have directly accused our volunteer leaders of being greedy and unethical, perhaps you'd like to share exactly what code of eithics you are speaking about and how this contract violates it.

(You were speaking directly about an ethical violation, right?  IOW, a clear and direct violation of a given code of ethics or codified set of norms, correct?)

Remember, the whole point of the VG contract is to provide a service to our members that NHQ tried for years to provide, but ultimately failed.  The VG contract has - and will continue to -save thousands of dollars of dues that otherwise went down the drain as we tried to come up with an workable model (Bookstore, Capmart, etc) at NHQ.

Sure, 1-800-nametapes could sell CAP nametapes for less than VG.  But try buing a master CDI badge from them.  VG's contract requires them to produce all current authorized insignia, which they do.

VG's contract does not last forever, and will be subject to competitive bidding for renewal.  Tom (and anyone else) will be free to bid. 

Just like last time.

But seriously, before you go publicly accusing our leadership of greed and ethical violations, please be able to lay out specifically what ethics were violated and how.

No wonder it is hard to find top-notch people to serve as our volunteer leaders, when they are subject to this sort of Monday morning quarterbacking.

Ned Lee
NHQ Apologist

[dmac]

 :clap: :clap: :clap:

Well stated. I am under the impression from some of the responses on this subject that CAP is somehow not allowed to protect its identity as other corporations are allowed to do. The standards that apply to other corporations somehow do not apply to CAP.

I also get the impression that some members would think it would be OK if  CAP were to get sued by VG for not holding up CAP's end of the contract, and allowing The Hock to continue to sell CAP items.

[ZigZag911]

Whatever the legalities of the situation, I still think talk of a  2B is going overboard for what has been a business dispute.

[Rotorhead]

Whatever the legalities of the situation, I still think talk of a  2B is going overboard for what has been a business dispute.

Really?

Would you condone a cadet intentionally breaking a federal law?

I wouldn't.

What Tom's done is exactly that. Why should he, or anyone else, get away with setting an example that says, "Laws can be ignored until someone enforces them"?

[JC004]

...
Sure, 1-800-nametapes could sell CAP nametapes for less than VG.  But try buing a master CDI badge from them.  VG's contract requires them to produce all current authorized insignia, which they do.
...

For the record, 1-800-NAMETAPE's fabric strip tapes are FAR superior to any nametape that Vanguard produces.  Just saying.  That will be all.

[davidsinn]

The poor ethics come from NHQ as well for setting this up in the first place. For a non-profit they are pretty greedy. If they were smart they would have opened the licensing up to anyone that can meet an NHQ spec and charge a percentage or flat fee. The unethical action is to set up a monopoly relationship at the expense of the members.

Really?  Why do you say that?


Now that you have directly accused our volunteer leaders of being greedy and unethical, perhaps you'd like to share exactly what code of eithics you are speaking about and how this contract violates it.

(You were speaking directly about an ethical violation, right?  IOW, a clear and direct violation of a given code of ethics or codified set of norms, correct?)

Remember, the whole point of the VG contract is to provide a service to our members that NHQ tried for years to provide, but ultimately failed.  The VG contract has - and will continue to -save thousands of dollars of dues that otherwise went down the drain as we tried to come up with an workable model (Bookstore, Capmart, etc) at NHQ.

Sure, 1-800-nametapes could sell CAP nametapes for less than VG.  But try buing a master CDI badge from them.  VG's contract requires them to produce all current authorized insignia, which they do.

VG's contract does not last forever, and will be subject to competitive bidding for renewal.  Tom (and anyone else) will be free to bid. 

Just like last time.

But seriously, before you go publicly accusing our leadership of greed and ethical violations, please be able to lay out specifically what ethics were violated and how.

No wonder it is hard to find top-notch people to serve as our volunteer leaders, when they are subject to this sort of Monday morning quarterbacking.

Ned Lee
NHQ Apologist

Perhaps the greedy comment was a bit much. Here is how I see it:

Vanguard is the sole licensee of CAP stuff. I'm not arguing that fact. That's a legitimate contract under the law.

We the members are required to buy our items from Vanguard. Vanguard jacked up their prices on CAP items beyond what the identical item in other parts of the site cost until they were called on it. Vanguard gave NHQ money. That's a kickback for driving business to them and they gouged us on prices. How is that not unethical? Where was the oversight of Vanguard?

The whole single supplier contract is a failed idea for this reason. They should allow anyone to produce CAP items and charge a percentage fee just like any other organization with IP to protect.

[Cecil DP]

The poor ethics come from NHQ as well for setting this up in the first place. For a nonprofit they are pretty greedy. If they were smart they would have opened the licensing up to anyone that can meet an NHQ spec and charge a percentage or flat fee. The unethical action is to set up a monopoly relationship at the expense of the members.

Really?  Why do you say that?


Now that you have directly accused our volunteer leaders of being greedy and unethical, perhaps you'd like to share exactly what code of ethics you are speaking about and how this contract violates it.

(You were speaking directly about an ethical violation, right?  IOW, a clear and direct violation of a given code of ethics or codified set of norms, correct?)

Remember, the whole point of the VG contract is to provide a service to our members that NHQ tried for years to provide, but ultimately failed.  The VG contract has - and will continue to -save thousands of dollars of dues that otherwise went down the drain as we tried to come up with an workable model (Bookstore, Capmart, etc) at NHQ.

Sure, 1-800-nametapes could sell CAP nametapes for less than VG.  But try Bing a master CDI badge from them.  VG's contract requires them to produce all current authorized insignia, which they do.

VG's contract does not last forever, and will be subject to competitive bidding for renewal.  Tom (and anyone else) will be free to bid. 

Just like last time.

But seriously, before you go publicly accusing our leadership of greed and ethical violations, please be able to lay out specifically what ethics were violated and how.

No wonder it is hard to find topnotch people to serve as our volunteer leaders, when they are subject to this sort of Monday morning quarterbacking.

Ned Lee
NHQ Apologist

Perhaps the greedy comment was a bit much. Here is how I see it:

Vanguard is the sole licensee of CAP stuff. I'm not arguing that fact. That's a legitimate contract under the law.


The whole single supplier contract is a failed idea for this reason. They should allow anyone to produce CAP items and charge a percentage fee just like any other organization with IP to protect.

The problem is that Tom knew for years that he was in violation of the CAP licensing agreement, and he kept selling the "copyrighted and licensed materials" until legal action was taken.   As for being 2b'd, I haven't heard that he has been, or that any like action is being considered. I have known Tom for 30 years, served with him in the Quincy Composite Squadron and consider him a friend, but the Hockshop is not a cottage industry that is being thrown out of business. He has made a very good living off of CAP for over 40 years, without any royalties being paid for the use of copyrighted insignia. He is still in business selling other items which are not CAP specific and probably making almost as much profits as he did before.   Let's not be sorry about his being brought to task for ignoring repeated warnings.

[Ned]

Vanguard jacked up their prices on CAP items beyond what the identical item in other parts of the site cost until they were called on it.

So their evil business plan was to increase the prices and hope nobody noticed the other pages on the very same website.  How . . . optimistic of them.

Never attribute malice when simple start up glitches are more likely.

But as you correctly point out, when the errors were pointed out, they fixed the problem.  That sounds like they are responsive and attentive to our needs.  Like they value the contract and our business.

Vanguard gave NHQ money. That's a kickback for driving business to them and they gouged us on prices. How is that not unethical?

Oh, I dunno.  A lot of ways.  Rather than asking rhetorical questions, why not tell us why you think it is unethical.  You're they guy accusing our volunteer leaders of being unethical. 

Speak plainly, sir.

Thousands of reputable businesses offer rebates, including every major automobile company in the world. 

Think of it this way: I grant you that by definition VG could charge less for CAP items because the rebate money has to come from somewhere.  The fallacy is in assuming that VG would charge less, instead of simply pocketing the money.  This way, at least CAP gets some training facility money.  The rebate is the consideration given by VG to CAP for the contract.

Where was the oversight of Vanguard?

The contract indeed does give oversight through the EXDIR.  Remember, no contract lasts forever, and VG values their reputation.  And if they are truly making a decent profit, they will want to be in a position to rebid the contract.

The whole single supplier contract is a failed idea for this reason. They should allow anyone to produce CAP items and charge a percentage fee just like any other organization with IP to protect.

You keep acting like this is some sort of unusual arrangement designed to somehow screw our members, but that simply isn't true no matter how often you say it.  Single source insignia contracts are the norm, not the exception.  Try buying official Boy Scout items from anyone but their contracted supplier.  Heck, even the Knights of Columbus does not let just anyone sell their uniforms and insignia.

And it bears repeating that VG is obligated to sell all of our insignia, including some expensive to manufacture items that might only sell a few dozen items a year.  (Like the above mentioned Master CDI badge.)  The slightly higher prices on common items like CAP tapes and wingpatches subsidize the low density items that might otherwise cost hundreds of dollars each.

But let's get back to some basic doctrine.  CAP's Core Values require each of us to treat each other with Respect and dignity.  I submit that directly accusing our leaders of greed and unethical behaviour without being able to provide a plausible argument that would suggest greed or unethical behavior does not meet our Core Value of Respect.

Wouldn't you agree?

Ned Lee

[PHall]

Davidsinn, go into an AAFES Military Clothing Sales store and take a look at the patches and insignia that are displayed.
You will notice one thing very quickly, just about every package has Vanguard on it.
So does that mean that AAFES and the Department of Defense are being unethical too?

[Slim]

Sure, 1-800-nametapes could sell CAP nametapes for less than VG.  But try buing a master CDI badge from them.  VG's contract requires them to produce all current authorized insignia, which they do.

I just have to take a bit of an exception to this.

Sure, they or any other vendor could provide a quality product at a better price.  And for many years, they did; I used Spur Cleaners from about 1986 until they got their C & D letter.  I always knew that I could mail in an order and have it inside of two weeks.  Later, in the age of the interwebs, I could get on their website on Monday, make an order for half a dozen of each tape, and/or a nameplate, and have an envelope show up on Friday.  If they can turn an order around in 5 days, why can't Vanguard?  I've got a cadet who's now going on about three weeks waiting for name and CAP tapes from them, and paid almost the same amount for three each that I used pay for 6 each from Spur.

So what if I can't buy a CDI badge anywhere other than Vanguard?  I think we all understand that there isn't much demand for CAP specific insignia (unless C/CMSgt chevrons are the latest fashion craze ).  I'm not buying a new badge every couple of years, but I am buying nametapes that often.  I had no problem getting what I needed from different sources; if what I needed was only available from one source, then that's who I used.  But I liked the ability to get what I needed from the vendor of my choice.

For 27 years, I've accepted the costs associated with being a member of this organization, and had no problem buying what I needed.  It's national telling me where I have to buy it that I have issues with.

We get the fact that the bookstore/CAP Mart was a financial flushing toilet--we get it.  It did seem to make sense to buy our insignia direct from the manufacturer.  It's the increase in prices since the Hock got shut down that is a problem.  Shut down the competition, then jack your prices?  Or how about changing product to something cheaper, but not reducing the price (like the navy blue flight suit I got ripped on). 

Davidsinn, go into an AAFES Military Clothing Sales store and take a look at the patches and insignia that are displayed.
You will notice one thing very quickly, just about every package has Vanguard on it.
So does that mean that AAFES and the Department of Defense are being unethical too?

I agree, but I've also seen a lot of IRA Green packaging, or AAFES generic packaging (which was most common last time I was in an MCSS).  Those nametapes Ned mentioned?  I'd bet that most military folks who buy their own (as opposed to waiting for supply to issue them) get them from Spur, Super Trooper, Cav Store, BQ, Bent Needle, or the embroidery shop just outside the main gate.