In most foreign countries, intellectual property protection is not adequate. Especially in Asia, there are no secrets and very little enforcement of ip rights. It does not matter that nondisclosure agreements (NDAs) are signed. People leak, especially underpaid labor.

Some American companies take the added precaution to divide manufacturing contracts for a product’s components among several factories. Only their most reliable suppliers perform the final assembly.

We were making a popular product in China. When other factories started to manufacture knock-offs, we showed the authorities our patent protection, and the government put a stop to the unauthorized products. Then in 1999 NATO put three Cruise missiles into the Chinese mission in Belgrade, and a diplomatic chasm was opened between NATO and Beijing. Suddenly those enforcement actions ceased. Here foreign diplomacy interfered with our business.