Manitowoc notes that the crane can be configured in entirely different ways, including with a travelling mast and with a lattice mast, with the VPC also transformed with the use of the Ultra Lift, and the company believes that the crane infringes on two of its patents. It also believes that trade secrets regarding the “commercial and desirable properties for such as crane”, divulged by Lanning, were used in the design of the SCC8500.
The trade secrets included technical information, designs, strategies, as well as customer names and pricing information, and Manitowoc alleges Lanning divulged these, despite having signed a confidentiality agreement in 2008.
The confidentiality agreement was binding for at least five years, or until the knowledge became public, and in an exit interview in 2009, Larry Weyers, Manitowoc’s EVP for the Americas, warned Lanning that if he disclosed any trade secrets legal action would be taken.

Speaking at the Bauma China trade fair last November, Manitowoc Cranes president Eric Etchart noted on the issue of patent infringement by rival companies, that as a publically listed company, Manitowoc has a fiduciary duty to its shareholders to protect its intellectual properties, and the investment they represent.

And indeed the filings make clear the scale of Manitowoc’s investment in the new cranes and the VPC technology: between 2009 and 2012, the majority of the wages it paid to employees performing engineering duties in the US were attributable to the 31000 and the in-progress cranes; and for the same period the majority of materials and supplies purchased in support of development of its cranes in the US were attributable solely to the 31000.

With the arrival of the SCC8500, Manitowoc believes that in addition to patent infringement and theft of trade secrets, its vital ‘first to market’ status is lost in the transformable VPC segment, especially important due to the “revolutionary nature” of the technology, and that Sany is “likely to capture a substantial portion of the market share that rightfully belongs to Manitowoc Cranes”. Advantages of ‘first to market’ with the transformable VPC were to have been early sales in the technology’s commercial cycle and reaching new customers while it was the only seller with the product in the market, while the impact of the SCC8500 will be price erosion for Manitowoc when it brings its new cranes to market.

The outcome for this would be damage to the crawler crane industry in America, due to the significant innovation costs borne by Manitowoc fro the development of the technologies. The company also believes there will be damage to its reputation as an innovator.

The International Trade Commission (ITC) has announced it will investigate the complaint, which would result in a sales ban of the crane if it is found to be infringing on patents. The ITC is known for moving quickly in its investigations and decisions. And in the federal court case filed in Delaware, where Manitowoc has demanded a trial by jury, the company is seeking damages to be trebled since the patent infringement was willful, which could result in a significant financial repercussions for Sany if it loses.

Whatever the outcomes, the investigation and the court case are set to have a significant impact on the crawler crane market in North America and in the rest of the world.