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AnonymousInactiveHP chemists hunt violators of ink patents
CORVALLIS,
Ore., A team of scientists and a phalanx of lawyers working on behalf
of Hewlett-Packard Co. have one thing on their mind: ink, specifically,
competitors’ ink.H-P’s ink-cartridge business acts as a powerful
annuity for the company. The technology titan, which has a market share
of 50 percent in the U.S. and more than 4,000 patents on its ink
formulations and cartridge design, often sells its printers at a loss,
then essentially locks customers in when they have to repeatedly come
back to buy replacement ink cartridges. In fiscal 2005, H-P made more
than 80 percent of its $5.6 billion in operating profit from ink and
toner supplies, according to Sanford C. Bernstein & Co.To protect
this franchise, increasingly under attack from rivals, H-P could sue
any ink makers it suspects are infringing on its patents. This month,
it sued China’s G&G Ninestar Image Co., a cartridge manufacturer,
alleging G&G had violated seven H-P patents in cartridge design.
The complaint also targets four online retailers. H-P also asked the
International Trade Commission to open an investigation against
Ninestar. A Ninestar spokeswoman said the company had no comment.This
latest suit follows other actions over the past year. In June, H-P said
retailers Walgreen Co. and OfficeMax Inc. had infringed on H-P ink
patents with ink used at in-store ink-cartridge-refilling stations;
Walgreen and OfficeMax both deny the claims. Last year, H-P similarly
warned the U.S. arm of Cartridge World Inc., a domestic retail
ink-cartridge refiller; Cartridge World says it is working to resolve
the issue.New competitors such as Cartridge World, Caboodle Cartridge
Inc. and Rapid Refill Ink International Corp. refill empty ink
cartridges made by H-P and others, and sell them at discounted prices
of as much as 50 percent off a new cartridge in locations such as malls
or downtown stores.”A lot of people come into the ink marketplace with
some assumptions that there really isn’t a lot of technology” in ink,
says Tuan Tran, a vice president of marketing in H-P’s printing
business. “We want to remind them that there is a lot of technology
that goes into formulations.”Such a reminder often comes in court,
where H-P is used to defending its patents on various products. In
2003, it launched a wide effort to protect its intellectual property
and profit from its 33,000 patents through technology-licensing deals.
Its litigation strategy has been on the increase under Mark Hurd, H-P’s
chief executive since March 2005, who wants to improve the company’s
profitability. In fiscal 2004, H-P’s patent efforts brought in around
$200 million in cash and product discounts.H-P’s ink studies often
start with teams of people in its printing group around the world, who
routinely collect all the inks they can get on the open market and ship
them to an H-P lab here in Corvallis for testing by LeAnn Bell, H-P’s
37-year-old coordinator of competitive-ink testing, and her team of
nine scientists.Ms. Bell had just graduated from the University of
Maryland, Baltimore County, in 1998 with a doctorate in chemistry when
she was recruited by H-P. Having studied mostly substances that cause
cancer, she was surprised that the company wanted her to study
something entirely different: ink.”I never thought about ink,” Ms. Bell
says. But H-P had thought about it a lot, and was looking for someone
with a background in chemistry to find a way to analyze inks from
competitors to determine whether H-P patents were being violated.Taking
on the assignment, Ms. Bell spent her first years at H-P learning the
chemical components of ink and chemical-testing methods from other
chemists. She soon pioneered the application of a test known as
capillary electrophoresis in the ink field. Using this test, an ink
sample is put into an electrical field inside a thin glass tube,
enabling the separation of charged components. The test helps create a
chemical “fingerprint” of the ink, which Ms. Bell can compare with
“fingerprints” of other inks. When an ink sample arrives in Corvallis,
Ms. Bell and her group of chemists store it and dissect all the
samples. On average, she and her team test 50 inks in a two- to
three-week period.One chemist on the team typically runs up to 60
individual ink samples a day through a large machine that uses a method
called gas chromatography. The machine heats the ink into a gaseous
form, and detects what solvents are inside it. The solvents help
indicate how the ink is made.Then there is the “egg yolk” test, in
which Ms. Bell puts a drop of colored ink on a petri dish and places a
drop of black ink from a competitor’s cartridge on top of it. If the
black ink forms a perfect black dot on top of the yellow dot, much like
an unbroken egg yolk, a high-quality ink is indicated, perhaps an ink
that infringes on an H-P patent.By such means, the ink team concluded
that InkCycle, a division of LaserCycle Inc. that made the ink for
Staples, had violated two H-P patents that prevent colors from bleeding
together in printouts. In March 2005, H-P sued InkCycle alleging patent
infringement. InkCycle settled with H-P in June 2005 for an undisclosed
sum and agreed to stop using the infringing inks.More often than not,
Ms. Bell says, she finds suspected infringements in the inks she tests.
But she adds that she isn’t sure that is indicative of the market, or
just of the samples she receives in the mail. “My job is enforcing our
ink patents so that we are all playing fair,” she says. “It’s the
corporate version of CSI.” -
AuthorAugust 30, 2006 at 12:11 PM
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