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 user 2007-11-12 at 11:52:00 am Views: 72
  • #20865

    US Government is about to Eliminate Competition in the Sale of Epson-Compatible Inks’ Says Paul Roark
    public needs to be made aware of a very anticompetitive, anti-consumer
    action about to be taken by the U.S. government’ writes Mr. Roark, a
    Retired Federal Trade Commission attorney, in his Op-Ed article.Susan
    Schwab is the US Trade Representative who’s signature is required on or
    before December 19, 2007 to enact this law.

    November, 2007 –
    ‘The public needs to be made aware of a very anticompetitive,
    anti-consumer action about to be taken by the U.S. government’ writes
    Mr. Paul Roark, a Retired Federal Trade Commission attorney, in his
    Op-Ed article.”It appears the fate of competition in the market for
    Epson-compatible inks is in the hands of the U.S. Trade Representative,
    if she does not act to stop the implementation of International Trade
    Commission (ITC) matter 337-TA-565,” says Mr. Roark who uses specialty
    black and white inks in his color EPSON printer that are manufactured
    by a small innovative company in America. “The ability of other
    companies to sell ink to consumers of Epson inkjet printers may be
    blocked by the U.S. government and this would in effect, subsidize
    Epson’s efforts to monopolize Epson-compatible ink sales by excluding
    inkjet cartridges from importation into the U.S.,” warned Paul Roark.

    prices of Epson inks in its cartridges are vastly higher than the
    competing ink options. In addition to the pre-filled, competitive
    cartridges, many use easily-refillable, third-party cartridges or
    continuous flow ink systems and buy ink in bulk, such as 4 oz. bottles.
    When bought in bulk, the prices for competing inks are about 1/10th
    that of what consumers pay for Epson inks.In addition to the huge price
    differential, the competitive options that allow the use of bulk inks
    do not cause the environmental problems associated with consumers
    throwing the small cartridges into our landfills. These options also
    will likely be eliminated by this ITC action.”While some have claimed
    that third party inks are inferior, this is simply not true in many
    cases,” said Mr. Roark. “In the small black and white, monochromatic
    ink market where I am most active the non-Epson inks are superior to
    Epson options”, he added. “Epson makes no product that can equal the
    image quality, stability and lightfastness of the carbon inks I use for
    my fine art, black & white photographic prints, and the inks I use
    are far cheaper,” he commented. U.S. companies have for years made very
    lightfast pigmented inks available for entry level printers where Epson
    sells only fast-fading dyes. In short, there are small, innovative U.S.
    companies that sell superior products for less. These companies are at
    risk of being put out of business by the combination of Epson’s
    anticompetitive practices and the U.S. government.

    The ITC Epson
    inkjet cartridge matter, now pending before the U.S. Trade
    Representative, is part of Epson’s attempt to prevent others from
    entering into aftermarket ink sales for its printer base. Mr. Roark
    opined, “Epson is using its patents over the interface between the inks
    and printers to accomplish this.” He added, “Even assuming these inkjet
    cartridge patents are valid, this is, in effect, an illegal “tying
    agreement” that ties subsequent sales of inks to the sale of the
    printer.” Tying agreements have been prohibited by the antitrust laws
    for many years, although the burden of proving an illegal tying
    agreement has been made much more difficult in recent years.
    Realistically, small competitors and consumers simply cannot afford the
    legal fees and years of litigation such matters now involve.
    Nonetheless, where a government agency is called on to exercise
    discretion, the fact of the likely illegal conduct and the larger
    competitive picture should be considered. Sadly, the plight of
    competitors and consumers who were never parties to this action may
    never have come to the attention of the decision makers. “The U.S.
    Trade representative needs to consider these factors when she makes her
    decision,” said Mr. Roark.

    “From a legal standpoint, there are
    cases that deal with these concepts,” said Mr. Roark. “The Ninth
    Circuit Federal Court of Appeals in Image Technical Services v. Eastman
    Kodak (125 F.3d 1195 (1997)) addressed for the first time the
    relationship of intellectual property rights and the antitrust laws,”
    he added. The court held that a monopolist who has achieved a dominant
    position through its patents and copyrights can nevertheless be held in
    violation the Sherman Act by exploiting that dominant position to
    attain a monopoly in another market. As a subsequent court noted,
    “Properly viewed within the framework of a tying case, (Image Technical
    Services) can be interpreted as restating the undisputed premise that
    the patent holder cannot use his statutory right to refuse to sell
    patented parts to gain a monopoly in a market beyond the scope of the
    patent.” (CSU v. Xerox, 203 F.3d at 1327) Also in Atari Games Corp. v.
    Nintendo of AM., Inc.: “(A) patent owner may not take the property
    right granted by a patent and use it to extend his power in the
    marketplace improperly, i.e., beyond the limits of what Congress
    intended to give in the patent laws.” (897 F.2d 1572, 1576 (Fed. Cir.
    1990)) In the full text if his Op/Ed published on hios website Mr.
    Roark urges interested individuals to read the excellent article on
    this subject by Nicholas Economides and William Hebert that can be
    found through a link on the full text of his op/ed.

    consumers as well as many businesses use printers that might be
    affected and they need to be aware of the problem and convey their
    concerns to the policy makers involved” said Mr. Roark. “Using dubious
    patents to monopolize adjacent markets, and having the ITC help in this
    effort is not what Congress had in mind when these legal regimes were
    put in place” he added. “Susan Schwab is the US Trade Representative
    who’s signature is required on or before December 19, 2007 to enact
    this law” said Mr. Roark who is urging consumers and small businesses
    that may be affected to contact her with their concerns. “Her office is
    at 600 17th Street, N.W., Washington D.C. 20508 (202) 395-3063,” he

    Mr. Roark believes strongly that consumer opinions in
    this matter may make a difference and urges anyone who is potentially
    affected to read his entire op/ed which can be downloaded at Roark is a former
    US Federal Trade Commission antitrust attorney residing in Solang, CA
    where he is known today as a photographer assisting other interested
    photographers in using carbon based inkjet inks in EPSON printers. His
    work can be seen at