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 user 2005-04-25 at 9:33:00 am Views: 65
  • #9097

    LI man’s $5M lawsuit says HP tricks consumers
    April ,

    A Valley Stream man has filed suit on behalf of New York consumers
    against Hewlett-Packard Co., charging the printer giant’s “smart chip”
    technology, which alerts users of an ink cartridge’s need to be replaced, sends
    “premature” and “false” messages aimed at lining HP’s pockets.

    class-action suit, filed Wednesday in U.S. District Court in Brooklyn by
    consumer Dennis Just, alleges breach of good faith, unjust enrichment and
    violation of New York business law, and seeks in excess of $5 million for the
    class and attorneys’ fees.

    The suit takes aim at a controversial
    technology that HP’s Web site presents as a convenience. Critics of the
    technology, however, say it’s primarily designed to stifle competition from
    companies that recycle old HP cartridges with new ink. The cartridges “expire”
    and can’t be used in printers between 2 1/2 and four years after

    “The primary function of this impressive-sounding technology
    is to make it difficult or impossible to refill that cartridge,” said a 2002
    article in PC Buyer’s Guide.

    But HP spokeswoman Jean Shimoguchi called
    Just’s suit “without merit.” She noted smart-chip technology is used in 3
    percent of HP’s ink-based printers, but wouldn’t say how many units that
    represents. The suit contends all HP ink cartridges contain smart

    Just wasn’t reachable and his lawyer, David Buchanan in Manhattan,
    didn’t return calls.

    The suit alleges HP, the world’s largest maker of
    printers and accessories, “claimed to consumers that the smart chip would
    improve printer performance.” Instead, it says, “the smart chip appears to be
    designed to secretly and deceptively increase the sale of HP replacement ink
    cartridges, whether or not ink remains in the cartridge and replacement is

    Just’s suit alleges the smart chip technology warns that
    replacements are needed when cartridges are “far from empty,” then “immediately”
    steers them to an HP-sponsored Web site to buy replacements.

    Shimoguchi said cartridges on the shelf have a four-year expiration date, aimed
    at preventing “degradation of print quality”; those in use in printers expire
    after about 2 1/2 years, she said.

    Gary Peterson, an analyst with
    research firm GAP Intelligence in San Diego, said Just’s suit represents the
    latest assault against what he called a cartel of printer-ink makers that
    controls the high-profit market.

    “A lot of people feel the ink industry
    is very much like the oil cartels,” said Peterson. He called the HP cartridge
    alert system “harmless,” but said the notion that cartridges can expire over
    time, rendering them useless when they still contain ink, has been

    In March, HP sued two companies that sell recycled
    cartridges refilled with non-HP ink, alleging the ink violates HP’s patents and
    that they mislabel packaging.

    Stephen Baker, a research director at NPD
    Group, said consumer frustration about cartridge pricing often boils over
    because “people feel cheated.”