In a lawsuit filed in a Delaware federal district court last week, Segway, the company which pioneered two-wheeled, self-balancing vehicles, alleges that both the Hovertrax and the Solowheel which are manufactured and sold by Inventist, a tech company in Camas, Washington that began a Kickstarter campaign in 2012 before releasing its first commercial product in late 2014, willfully violate Segway’s existing patents. The lawsuit seeks damages, attorney fees and permanent injunctive relief preventing Inventist from selling any of the allegedly infringing products. If the suit is successful, it could stop Inventist’s latest products in their tracks and reshape the skyrocketing self-balancing scooter “hovermania” market.
When it was first revealed in 2001, the Segway scooter was expected by many to revolutionize the way people got around. The company was founded by Dean Kamen, a successful inventor from New Hampshire. Despite much fanfare at launch including praise from the likes of Steve Jobs and venture capitalist John Dorr, Segway struggled to grow profits or find mainstream success.
But, if you’ve ventured out in any major urban center around the world in the last year, chances are you’ve seen someone whiz by on an electric, self-balancing scooter otherwise known as a “hoverboard” – even though it really doesn’t “hover” like the flying neon contraption strapped on by Marty McFly in Back to the Future II. While the Segway evokes images of mall cops or pasty tourists awkwardly cruising along the Freedom Trail and other tourist attractions in bulbous helmets, the hoverboard is about personal freedom of movement and is favored by younger, hip, urban dwellers. Unlike the Segway, it can be seen in skate parks and is considered ‘Big City Cool’. In short, they are this year’s must-have holiday item, coveted by children and adults alike and while retailers are promoting them heavily, competition amongst maufacturers for market share and potentially lucrative profits is intensifying.
The Hovertrax was created by Inventist, and is considered by many the original two-wheeled scooter. In their company bio, Inventist claims that their $1,495 Hoevertrax is “the world’s first portable, double wheeled, self-balancing device.” In addition to the Hovertrax, Inventist offers transportation junkies the ability to master the unicycle, the chance to walk and skip on water, and something called “Orbitwheels” which is a cross between a skateboard and inline skates. By contrast, the larger Segway self-balancing scooter has much larger wheels than the hoverboards of today and waist-high handles and it uses a gyroscopic stabilisation system to balance riders.
Like many other first generation products, the Hovertrax was reverse-engineered at factories throughout China – resulting in more companies entering the marketplace – and a decidedly cheaper alternative than the Hovertrax. Rivals include the Mobi Max, MonoRover R2, IO Hawk and PhunkeeDuck. While they all claim to be the fastest, smoothest and safest, they all basically rely on the same technology to get a person from point A to point B.
The legal maneuvering all started in September of 2014 when Segway tried to ban Ninebot from exporting its products to the U.S., saying the company had infringed on its earlier patents. Half a year later, Ninebot acquired Segway, and both brands continue to operate under their different names.
Inventist’s Hovertrax has attracted a lot of attention in recent months with celebrity endorsements by Tony Hawk, NBA superstars and even the likes of Justin Bieber. It’s the new cool toy to have. Significantly cheaper than any Segway model, the Hovertrax has reached a much broader audience than its predecessor. At the same time, Inventist’s design has often been described as a “Segway without a pole” or in similar terms which partially explains the recent claims of patent infringement.
The focus of the latest lawsuit is US Patent 6,302,230, which covers the Segway’s unique method of transportation, “particularly to balancing vehicles and methods for transporting individuals over ground having a surface that may be irregular.” The patent describes “An automatically balancing vehicle having a headroom monitor.” Under the law, Segway claims to own notable attributes like “a platform which supports the user,” “a ground-contacting module,” and “a motorized drive arrangement.” According to Segway’s complaint, “Inventist has knowledge of the ‘230 patent or has acted with willful blindness to its existence.” Similar claims are made for US Patent No. 6,651,763, US Patent No. 7,023,330, US Patent No. 7,275,607, and US Patent No. 7,479,872.
However, Inventist has its own patent for the two-footed control method for the Hovertrax, and apparently believes that it has every right to sell its device, since it has filed its own lawsuit against a number of imitators based upon the filing including Soibatian Corporation, the makers of the IO Hawk, a device that looks and works a lot like the Hovertrax. One of the most popular so-called hoverboards on the market is the Phunkeeduck. Like the Hovertrax and the IO Hawk, the Phunkeeduck looks a lot like a mini version of the Segway, with the iconic vertical handlebar removed. The Segway claim focuses more on the balance-monitoring system. It’s still unclear whether Inventist will be able to use its preexisting patent in mounting a defense.
The legal controversies following self-balancing motorized boards is not confined to the courtroom or disputes over intellectual property rights. In recent months, property owners from Massachusetts to California have banned them for liability reasons and even though they have taken many urban centers by storm, some states classify them as motorized vehicles that cannot be registered, so riding them in public can result in a hefty fine. Recently, the police department at the University of California, Los Angeles, said hoverboards would not be allowed on walkways and in hallways after pedestrians complained about collisions. In response, lawmakers have tried to get ahead of the problem. A new California law effective January 1st will allow electric-powered boards to be ridden in bike lanes and pathways, ideally to help commuters break free from cars and bicycle traffic. In London, the authorities recently reminded residents that the boards are banned from public streets and roadways because they are dangerous. Stores have been slow to stock hoverboards, despite anticipating a holiday crush, because of liability concerns. At Hammacher Schlemmer’s flagship New York store, customers can test its custom $1,400 electric gyroboard transporter, but only when the store is not crowded.
But that’s not the end of the story. China’s smartphone maker Xiaomi has even entered the frey by introducing its own version of the hoverboard which at a quarter of the price of other self-balancing scooters threatens to saturate the market by using the same cut-price marketing tactics that made Xiaomi famous. So, as these popular copycat devices are gaining in popularity as opposed to the less popular Segway itself, how will Segway defend itself from competitors?
Whether you call them hoverboards, Segways or self-balancing scooters, the legal landscape for these urban toys is changing. And, when all is said and done, Segway may hold all the cards and have the right to see that every product that violates their patent can be pulled off the shelf.
Meanwhile, you’ll probably continue to see urban hipsters and others riding their “hoverboards” in the nation’s largest cities, lawsuits or not.