A California judge has ruled that Lexmark
International's laser-cartridge return programme is fair and
legal.
Lexmark's rebate programme offers an up front discount to
consumers who agree to return used cartridges only to Lexmark for
refilling or recycling. The Arizona Cartridge Remanufacturers
Association (Acra) had charged in a lawsuit filed in 2001 that the
programme, formerly known as Prebate, was illegal under California
law because it constituted unfair and deceptive business practices
as well as deceptive advertising.
Judge Saundra Brown Armstrong dismissed Acra's lawsuit. "Because
of its patents, Lexmark has the right to impose conditions on the
sale of its patented product. It may restrict a purchaser's ability
to repair it, which is what, in essence, the single-use condition
does," the judge wrote in her ruling.
The ruling concluded that “Lexmark has adequately shown that
there is little, if any evidence to support Acra’s contention that
the Prebate programme is misleading, deceptive or unfair.”
Printer makers make recurring profits by selling replacement
cartridges, but other companies have entered the lucrative market
by buying empty cartridges from users, then selling the refurbished
and repackaged cartridges.
Acra had claimed that Lexmark's rebate programme, as well as the
use by Lexmark of a "lock-out" chip in its latest Prebate products,
was unfair. According to Acra, the chip is intended purely to lock
out Prebate cartridges remanufactured by third parties for use in
Lexmark printers.
The judge ruled that Acra had not sufficiently proven its case
regarding the lock-out chip. "Acra brought forth exactly one
Lexmark purchaser who complained of being frustrated and
dissatisfied. Frustration and dissatisfaction, however, do not
equate to deception," she added.
Lexmark welcomed the ruling in a statement, adding that it
continues to offer more choices in toner cartridge purchases than
any other laser printer manufacturer.
Acra has 30 days to file an appeal.
A separate lawsuit brought by Lexmark against Static Control
Components is still pending. Lexmark has charged that a microchip,
the Smartek, made and used by SCC in remanufactured laser printer
toner cartridges to defeat Lexmark's technological controls, is a
violation of the Copyright Act and the Digital Millennium Copyright
Act.
Static Control is one of the sponsors of the Acra lawsuit,
Lexmark said in its statement.
Laura Rohde writes for IDG News
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