Legal disputes
In 1963, Sears employee Peter M. Roberts developed a quick release feature for socket wrenches. The feature allowed a person using such a ratchet to remove the socket from the wrench with one hand, freeing the second hand from grabbing the socket while the other hand held the ratchet.[34]
Roberts developed a prototype and applied for a patent in 1964.[35] While the patent was pending, he approached Sears and introduced the idea to them. Sears, which sold millions of sockets every year, saw the potential in the invention and asked for the prototype so it could be tested. After testing revealed the quick release would not weaken the ratchet, Sears began market testing the new ratchet and received favorable feedback. Sears then incorporated the quick release into a new line of ratchets, projecting sales of up to 750,000 units in the first year alone.
In January 1965, Roberts received a phone call from a Sears attorney asking for the name of Roberts' patent lawyer. Without Roberts's knowledge, Sears hired the patent lawyer, Charles Fay, and Fay ended up representing both Roberts and Sears regarding the patent. Around this time, Roberts's patent was approved, but Fay did not reveal this to Roberts. Negotiations for use of the quick release commenced, with Roberts being told that the quick release wasn't new and that any patent issued would be limited. Sears's lawyers also said that because of the cost (44 cents per wrench) of adding the quick release to the wrenches, a license was worth only $10,000.[36] What Sears didn't tell Roberts was that it planned to make 50,000 of the new wrenches per week.[37] Roberts sued Sears in 1969 after seeing his quick release on a wrench prominently displayed in a Sears catalog, but it wasn't until 1989 that the case was finally settled. Neither side revealed the amount of the settlement.[38]
In August 2002, Sears sued Emerson for using Sears-owned manufacturing equipment to create power tools for Home Depot. Upon the expiration of Emerson's 30-year contract to make Craftsman tools, Emerson was required to return the Sears-owned equipment. Instead, Emerson kept the equipment, claiming it to be obsolete and of little value. Emerson denied the allegations when the suit was filed, but paid Sears $10.8 million and returned all the equipment, while admitting no wrongdoing.[39]
In 2004, a class action by customers accused Sears of false advertising and consumer fraud for questionable use of the slogan "Made in the USA" for Craftsman tools.[40]
In 2012, Sears was sued by LoggerHead Tools, makers of the Bionic Wrench, after Sears released a competing product, the MaxAccess. Sears had sold the Bionic Wrench in its stores, but decided to not talk to LoggerHead about licensing the patent. Instead, Sears had its tool manufacturer, Apex Tools, create the MaxAccess wrench under the Craftsman name, claiming that the MaxAccess was designed not to infringe the Bionic Wrench patent. Other than coloring, the only substantial difference between the two wrenches was that the Bionic Wrench had the head at a 45-degree angle while the MaxAccess head was straight. LoggerHead was subsequently awarded $6 million in damages, but the verdict to be set aside because the judge misinterpreted the LoggerHead patent.[41][42]
In April 2017, Sears sued Western Forge, its former supplier of hand tools, for abruptly ending the contract to supply the tools. Western Forge violated the contract by demanding more money because of Sears's financial problems.[43]
On March 6, 2019, Sears was sued by Stanley Black & Decker, which accused it of breach of contract and trademark infringement over its new line of professional-grade mechanics tools under the Craftsman Ultimate Collection brand. According to the complaint, Sears breached the license agreement by launching its new tool line and touting its stores as "the real home of the broadest assortment of Craftsman".[44]