KATUN TO LAUNCH KATUN BRAND SOLID INK STICKS

[Anonymous]

KATUN TO LAUNCH KATUN BRAND SOLID INK STICKS

Katun Corporation recently released a statement addressing the news that Media Sciences International and Xerox settled their patent-infringement dispute (see “Media Sciences and Xerox Settle, Media Sciences Exits Xerox Ink Stick Business”). While Katun did not address the issue in its release, Media Sciences subsequently announced that the company would be liquidated (see “Media Sciences Bids Industry Goodbye”). As we reported last month, Media Sciences will be exiting its industrial solid ink business by the end of the financial year and will stop manufacturing solid ink sticks for use in Xerox color printer and MFPs. As a result, Media Sciences terminated its master distributor agreement with Katun for Media Sciences-brand ink sticks, and it appears that the firm must pay an early termination penalty to Katun. But Katun is not willing to bid its solid ink stick business goodbye. The company says it expects no supply interruption for current customers, and the firm will be rolling out a new Katun-branded line of solid ink sticks.

We reported that it appears that Katun will be able to sell its current Media Sciences inventory, and Katun’s press release indicates that this is indeed the case. Katun made a large initial stocking order for these ink sticks Katun’s initial stocking order for solid ink sticks (see “Media Sciences Reports Financials Results, Receives Boost from Sale of Toner Business”).  Katun President and CEO Carlyle Singer commented, “We do not believe this agreement will affect Katun customers currently purchasing the Media Sciences brand solid ink product line; it is very unlikely there will be any supply interruption.”

We had expected that Katun would no longer offer Xerox-compatible solid ink sticks after selling through its current inventory, but that is not the case. The second part of Ms. Singer’s statement reveals that Katun will be introducing its own branded solid ink line. Ms. Singer said, “Based on our testing, we are confident that our new Katun brand solid inks will provide even better performance, print quality and color matching than customers had previously received.”

It is not clear whom Katun has selected to be its new manufacturing partner for solid ink sticks. Although Media Sciences was long the name synonymous with compatible Xerox ink sticks, there are some alternative sources on the market. MSE announced a line of compatible ink sticks last November. South Korea-based Inknara manufactures solid ink. LD Products distributes a line of its own branded compatible solid ink sticks, presumably made by a partner. LD products was one of the Ninestar distributors named in Canon’s toner cartridge patent-infringement complaint (see “Canon Officially Announces End of Patent-Infringement Dispute with Ninestar”).  We have also seen various Chinese distributors selling compatible solid ink sticks.

Whoever Katun’s new manufacturing partner may be, we are sure that with the Xerox and Media Sciences’ patent-infringement litigation still fresh in its mind, Katun once again has an indemnity clause in place to protect it from paying expenses related to litigation, as it did with Media Sciences. It is less likely that Xerox has signed on to any such agreement, however, so if the OEM chooses to pursue new patent-infringement litigation against ink stick manufacturers and their distribution partners, it is unclear whether Katun would be protected.

[Author]

June 7, 2011 at 12:48 PM