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Chinese roulette

American buyers can find great deals on Chinese products they may sell for a tidy profit. But it can be a dangerous game.

GUANGZHOU, China

Ron Rust and Beve Kozub were poking around the toy booths at China's biggest trade fair two years ago when something caught their eye: pouty-faced baby dolls snuggling in light blue and pink fleece blankets, their eyes tightly shut or gazing with a newborn's woozy stare.

The American dealers plunked down $22,052 for a shipment of 2,740. But the lifelike dolls turned out to be knockoffs. Rust and Kozub were slapped with a lawsuit that could have cost them their home in Harmony, Pa.

Despite getting burned, they were back in China this fall. For new products at the right price, China is "the only option at this time," Rust said.

The Americans fell prey to one of the many dangers of China's rough and raw capitalism. It's a cutthroat, predatory world where many factories cut corners to make an easy buck or just stay ahead of the thousands of others vying for their business. Safety scares, copyright ripoffs and outright thuggery are endemic.

Yet, foreign buyers keep snapping up toys, clothes, laptops and myriad other products that the world's factory floor churns out. Getting your hot product made in China is seen as a sure moneymaker. In the first 11 months of 2007, China's exports totaled $1.1-trillion, up 26 percent from the same period in 2006, according to China's Commerce Ministry. Chinese exports to the United States totaled $212.7-billion, a 15 percent increase from 2006, the ministry said.

Buyers are not blameless: Many breeze in on buying missions and don't stick around to ensure goods are made right.

For consumers, it can be a dangerous and even deadly game. Chinese-made toy trains coated with lead paint ended up in playrooms worldwide. Cough syrup containing a poisonous chemical used in antifreeze killed dozens in Latin America. A tainted pet food ingredient killed dogs and cats in North America.

Chinese officials defend their factories, saying only a tiny fraction of the billions of dollars in exports each year have problems. But it takes just one bad batch of toothpaste to cause deaths.

American doll dealers Rust and Kozub have come to China on buying missions twice a year for the past four years.

"Before we ordered the dolls, we asked if the design was theirs and they said, 'Yes,' " Rust said.

The dealers had sold most of the order when they got sued by Ashton-Drake Galleries, a major American dealer that owns the copyright to the doll's design.

"When you're in China, how can you check on copyrights?" Kozub asked.

Their lawyers said they didn't stand a chance in court and would likely lose their home in a legal defeat. So they paid a settlement of $14,400 and destroyed the 107 unsold dolls.

"Our business was just starting to turn a profit," said Rust, who launched Springers Wholesale with Kozub five years ago.

In October, they returned to China's biggest trade show, the Canton Fair in Guangzhou, to scout for products and confront the supplier of the copied dolls.

The dollmaker's vice general manager, David Qin, sat at a booth lined with blond, blue-eyed dolls - different from those the Americans had bought two years ago.

Qin said the Americans were misled by a sales representative who no longer works at the company, Yangzhou Zhongyi Toys Co., Ltd. He told Rust to take up the issue with him.

After the meeting, Kozub and Rust sat at a coffee shop and shook their heads.

"Sometimes we scratch our heads and wonder what we're doing here," he said.

[Last modified January 14, 2008, 23:32:41]