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Date First Reported: May 2014

Primary Name Associated: Du Richeng

Description of Potential Fraud:

fraud-warning

An Illinois firm reported to us that they’ve been contacted by the purported Du Richeng of Winteam Pharmaceutical Group with regards to retaining their services to collect on a breach of a copyright agreement.

This is a classic bad cheque scam that presents as legal matter requiring the assistance of a lawyer. In this scam lawyers will be duped into wiring real funds from their trust accounts after depositing a fake cheque received as payment from the party in breach of the agreement (who is also part of the fraud). See our Confirmed Fraud Page for more of an explanation of how these frauds work and to see other names associated with it. Our Fraud Fact Sheet lists the red flags of a bogus legal matter that is really a fraud.

Here is the initial contact email sent by the fraudster to the lawyer:

From: du richeng
Reply-To: du richeng
Date: Wednesday, May 14, 2014 11:01 AM
To: “[email protected]
Subject: Your legal services on Intellectual Property

Dear Attorney,

Your legal services on Intellectual Property is urgently needed as a result of an infringed copyright issue between my company and a business associate who has violated our agreement.

Please advise if you are in a position at this moment to take up this case which is in your jurisdiction.

Expecting your urgent response.

Kind regards,
Du Richeng
Chairman
Winteam Pharmaceutical Group Ltd.
141 Des Voeux Road
Central, Hong Kong
www.winteamgroup.com
T. +852 8191 3674

Replying to the email brought this response:

Thank you very much for your respond and readiness to accept this case.

My company wish to request for your services towards the enforcement of our intellectual property rights. We have a contract manufacturing agreement with Apira Science, Inc 2601 Main Street # 530 Irvine, CA 92614 for the manufacture, supply and distribution of our medical and pharmaceutical products to consumers in the United States. These medical and pharmaceutical products or devices are embedded or preloaded with our proprietary software coded in Chinese language but equipped with a Chinese to English language translator from our factory or assembly plants here in Hong Kong before being shipped to the United States.

However, as a result of increased market demand for our medical and pharmaceutical devices in the United States and to make our products compete more favorably with other products, there was the need to have the embedded software written in English language. It was considered that these will remove several inefficiencies as result of translation from Chinese to English language. As a result of the foregoing, we entered into a copyright license agreement with Apira Science, Inc for the translation of our software programs from Chinese to English language for our medical and pharmaceutical devices. As result of the foregoing, we entered into a copyright license agreement with our client in January 2013 for the translation and development of our software programs in English language.

However, in April 2013 during a schedule facility and inspection tour by our audit consultant from Hong Kong to our client manufacturing facility it was uncovered that Apira Science, Inc was equally manufacturing the Spanish language versions of our product without license. In addition, our client was equally distributing the unauthorized Spanish language versions of our products within and to outside the United States and this is a complete violation of our agreed terms.

Following the initial discovery by our audit consultant, a detail investigation was carried and it was uncovered and confirmed by our client that 250,000 copies of the Spanish language version of the software programs have been produced and 200,000 shipped and sold already in Mexico. After this agreement was breached, we had a lengthy negotiation, and consequently it was mutually resolved and agreed that sixty-five percent (65%) earned profits on the unauthorized production should be payable to us and payment deadline of 30th of June, 2013 was agreed. However, the deadline date was extended to 28th of August, 2013 as requested for by Apira Science, Inc.

Quite unfortunately, the extended deadline was not honored.

Despite the foregoing, I will like to draw your attention to the relationship with Apira Science, Inc which has been cordial and we have had a successful business relationship over the past few years, and it is our position to maintain the relationship after settling the issues on hand. Right now, I will like to take appropriate steps and measures to enforce our copyright license agreement and/ or claim infringements and damages as appropriate.

Our expectation of your services for now will be within the scenario of a Demand letter to Apira Science, Inc. This approach will trigger the much needed response from our client towards amicable settlement otherwise we will not hesitate to go into court litigation. We are prepared to pay your retainer fees. Attached is the copyright agreement and as we progress we shall send other documents.

We look forward to your prompt response and Kindly send now your retainer agreement which will be signed and returned to you should conflict clear.

Expecting your urgent response.

Kind regards,
Du Richeng
Chairman
Winteam Pharmaceutical Group Ltd.
China Insurance Group Building
141 Des Voeux Road
Central, Hong Kong
www.winteamgroup.com

How to handle a real or suspected fraud

If you have been targeted by any of these frauds, please forward any of the emails and supporting documents that you have received to [email protected]

If you suspect you are acting on a matter that might be a fraud, call LAWPRO at 1-800-410-1013 (416-598-5899). We will talk you through the common fraud scenarios we are seeing and help you spot red flags that may indicate you are being duped. This will help you ask appropriate questions of your client to determine if the matter is legitimate or not. If the matter you are acting on turns out to be a fraud and there is a potential claim, we will work with you to prevent the fraud and minimize potential claims costs.

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Fraud Fact Sheet More fraud prevention information and resources are available on the practicePRO Fraud page, including the Fraud Fact Sheet, a handy reference for lawyers and law firm staff that describes the common frauds and the red flags that can help identify them.