Teenager Could Go to Jail for Selling White iPhone Conversion Kits
About six months ago, an entrepreneurial Bronx 17-year-old named Fei Lam had a bright idea: Since Apple customers wanted white iPhones so badly and the company didn’t seem to be satisfying their desires anytime soon (and may never do so this generation of phones), Lam contacted Foxconn, Apple’s Taiwanese supplier, and was able to get access to white iPhone 4 parts.
Lam launched a site called WhiteiPhone4Now where impatient iPhone fanatics could get full conversion kits for $279; major media attention followed, and Lam says that he’s made more than $130,000 since August, money which he says will go towards his college education.
But Lam could be in trouble. He says that yesterday, he received a letter from a presumably Apple-backed private investigator accusing him of “selling stolen goods,” the consequences for which could be steep:
Yesterday however, Lam received an ominous letter. “I got an email from a private investigator accusing me of selling stolen goods, which I’m 100 percent sure is not the case. They are some kind of anti-counterfeit/trademark firm, which sounds ridiculous, similar to what Apple is bringing up to remove White iPhone 4 Listings on eBay. I don’t know how this legal stuff works.”
The consequences for selling stolen good online can be steep. In September a women in Kansas was convicted of selling stolen goods on eBay. She faces a maximum of five years in prison and a $250,000 fine.
Lam intends to contact a lawyer and has no plans to take his site down or change his business. “There are a couple of other sellers online and somehow I’m the ‘focus’ of it all. I think this guy is just trying to scare me into stop selling on behalf of Apple.”
I’m not a lawyer and won’t pretend to have a full grasp of the potential legal issues involved in determining whether this does or does not constitute the sale of stolen goods; however, from a layman’s perspective, this seems off. If anyone’s to blame, it sounds like it should be Foxconn, but even they may be in the clear; a TUAW commenter says that “You can order the white panels as replacement parts from Foxconn. It’s a legal loophole – as long as Apple has not paid Foxconn for a part Foxconn has manufactured, it’s Foxconn’s property. Probably the Apple/Foxconn contract clears this issue, but since Foxconn sells this ware, it seems it doesn’t.”
Does Apple have a case, or has Lam pulled off a clever bit of arbitrage by scooping up the parts before they pass from the OEM to the company that ordered them? Legal perspectives especially welcome.