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AnonymousInactiveEpson goes after third-party ink cartridges and wins
Epson
has won a series of victories in its quest to cut down on the
importation and manufacture of aftermarket inkjet cartridges for its
products.
The company just announced that it has signed
settlement agreements with multiple defendants, all of whom acknowledge
that they were in violation of Epson patents.Epson has been pursuing
these companies for months, filing lawsuits against them in federal
court and bringing a complaint with the US International Trade
Commission early this year. Many of the companies involved have now
decided to settle rather than fight the patent infringement charges.
Artech (Germany), Ink Lab Co. (Hong Kong), InkTec (Korea),
Inkjetwarehouse.com (Connecticut), and Rhinotek Computer Products
(California) have all agreed to stop importing many kinds of
aftermarket cartridges for Epson printers, a move that could make it
more difficult to get inexpensive refill cartridges.In the federal
court case, Epson charged a long list of defendants (many of whom have
not yet settled) with patent infringement based on two patents:
7,008,053 and 7,011,397. Both patents cover minor technical innovations
in the production of inkjet printer cartridges.In addition to the
settlement agreements, three other companies have agreed to “consent
orders” from the International Trade Commission that will prohibit them
from importing the cartridges in question. In addition, an ITC judge
has issued default judgments against eight other companies that did not
respond to the accusations against them.Keith Kratzberg, Epson
America’s VP for marketing, said in a statement, “We will continue to
pursue the ITC action and the pending District Court lawsuit vigorously
and take whatever other action may be necessary to protect Epson from
unfair competition through patent infringement or the distribution of
counterfeit ink cartridges.”Epson has been winning such cases around
the world. In June, the company received a preliminary injunction from
a Taiwan judge against U-Bar International over that company’s
“Continuous Ink Supply System,” also on patent infringement grounds.
Printer manufacturers traditionally follow the strategy made famous by
Gillette, where the razor is sold cheaply (or at a loss) in order to
make money on consumables like blades (or, in this case, printer
cartridges). Because they have adopted this business model,
manufacturers routinely try to prevent third-party companies from
edging in on the consumables market.Epson’s current claims involve
patent and copyright, though DMCA injunctions have been a favored
tactic of other companies. Lexmark lost such a case several years ago
when it implemented a trivial security system on its cartridges, then
sued a third-party manufacturer for bypassing its proprietary
“encryption.” A judge ruled against Lexmark, and Epson has elected to
take a different approach with its legal strategy. So far, it looks to
be working.Epson Stops Ink-Makers
Lawsuits halt makers of replacement printer cartridges.
Fewer
Epson-compatible ink cartridges from third-party manufacturers will be
available, because the printer vendor has convinced a number of
manufacturers and importers to stop producing and marketing them.Sued Vendors
Last
February, Epson filed a complaint with the U.S. International Trade
Commission against 24 companies that manufacture, import, or distribute
after-market ink cartridges for sale in the U.S. The complaint sought
to ban the companies from importing or selling the cartridges in the
U.S. At the same time Epson filed a lawsuit in the U.S. District Court
in Portland against the same companies seeking damages for the alleged
intellectual property infringement.Of the 24 companies, five have
agreed to settle with Epson at both the ITC and district court. A
further three companies have agreed with the ITC to stop importing
cartridges, but will have their cases heard at the district court.
Another eight companies have had default judgments filed against them
at the ITC because they failed to respond to the complaint with the
time allowed, said Epson. Trials against the remaining companies at the
ITC will begin in January.Latest Settlements
The
settlements and judgments are the latest in a line of legal victories
by Epson against third-party ink-cartridge makers, distributors and
vendors.
In June, a court in Taiwan barred a local manufacturer of
continuous ink supply systems from producing models for Epson printers
after receiving a petition from the Japanese company. A month earlier
Epson succeeded in getting four German online retailers of printer ink
cartridges to stop selling a number of third-party ink cartridges
designed for use in Epson printers.The company won a similar legal action against a Japanese manufacturer in June 2005.
Printer
makers like Epson typically rely on a business model that sees them
selling printers at little or no profit, then making money down the
line on ink cartridges and other consumable items. Epson sells its own
replacement cartridges and licenses a number of companies to make and
sell Epson-compatible products. The third-party vendors targeted by
Epson have no relationship with the printer-maker and so it doesn’t
directly gain from any of their business.Correction: Epson sells its
own replacement cartridges, and a number of companies make and sell
Epson-compatible products. Epson does not license companies to make and
sell Epson-compatible products.
Epson takes steps to protect its ink cartridge business in the United States
When
DailyTech last visited the “Inkjet Cartel,” Epson was taking US-based
e-tailers to court over the sale of generic Epson-compatible ink
cartridges. Epson was pretty confident that things would go in its
favor given that it had successfully won cases against companies in
Europe and Asia.Luckily for Epson (and sadly for consumers), the
company’s winning streak has extended into the United States. The
company filed complaints with the United States International Trade
Commission (ITC) against 24 companies in February of this year. The
infractions cited ranged from manufacturing aftermarket ink cartridges
to importing ink cartridges from foreign countries for sale in the
United States. Network World reports:Of the 24 companies, five have
agreed to settle with Epson at both the ITC and district court. A
further three companies have agreed with the ITC to stop importing
cartridges, but will have their cases heard at the district court.
Another eight companies have had default judgments filed against them
at the ITC because they failed to respond to the complaint with the
time allowed, said Epson. Trials against the remaining companies at the
ITC will begin in January.Epson’s string of victories could lead other
printer manufacturers to follow suit. The replacement inkjet market is
a huge business for printer manufacturers and they are pulling out all
the stops to protect their bread and butter. Hewlett-Packard was so
depended on its ink cartridge business at one point that it was
generating nearly all of the company’s profits.The tricks that the
printer manufacturers have used to get customers tied into buying
expensive OEM cartridges range from giving customers meager “starter”
cartridges with printer purchases or including chips on the cartridges
to prevent customers from using generics. And we can’t forget the ink
cartridges that will report empty even though there is still plenty of
ink left to print dozens of pages.But all of this is expected.
Manufacturers are practically giving away inkjet printers, enticing
customers with a low cost of entry. And then customers are hit in the
wallet when it comes time to replace the inks cartridges. -
AuthorDecember 6, 2006 at 11:50 AM
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