Lexmark: Ruling Affirms Legality of Return Program, Patent Violations
June 25, 2007
Lexmark International, Inc., (NYSE: LXK) said today that the effect of decisions in litigation in the U.S. District Court, Eastern District of Kentucky, Frankfort, Ky., is to affirm the legality of Lexmark’s Return Program for laser printer toner cartridges and to affirm that certain remanufacturers are violating Lexmark patents when they remanufacture Lexmark Return Program toner cartridges.
Central to the litigation brought by Lexmark against Static Control Components Inc. is Lexmark’s popular Return Program for laser printer toner cartridges under which customers can get discounted cartridges in return for agreeing to return the used cartridges only to Lexmark for remanufacturing or recycling. Lexmark uses the returned laser printer toner cartridges in its own remanufacturing business. Lexmark has always offered laser printer toner cartridges without a discount that may be remanufactured by anyone, assuring both customer choice and the opportunity for fair competition.
Over the course of the litigation, the court ruled that Lexmark’s
patents were valid, covered Lexmark’s toner cartridges and that
Lexmark’s patent license under the Lexmark Return Program was valid and
enforceable. Although the jury found that Lexmark had failed to prove
that Static Control had induced its customers to infringe Lexmark’s
patents, the court found that Static Control engaged in direct patent
infringement and that certain third parties who engaged in the
remanufacture of Lexmark’s Return Program laser printer toner
cartridges were in direct violation of Lexmark’s patent rights. Three
remanufacturers who were parties in the lawsuit earlier, NER Data Inc.,
Pendl Companies Inc. and Micro Solutions Enterprises (MSE)/Wazana
Brothers International Inc., settled and admitted the validity and
enforceability of the Lexmark patents and the Lexmark Return Program.
In addition, Static Control’s antitrust and false advertisement
allegations against Lexmark were dismissed by the court.
“Lexmark’s Return Program benefits customers, is good for the environment and is fair to the competition. The impact of the decisions of the court is both meaningful and positive. We will continue to pursue claims whenever and wherever necessary to protect Lexmark’s intellectual property,” said Vincent J. Cole, Lexmark vice president and general counsel.
Lexmark originally filed suit in U.S. District Court, Eastern District of Kentucky, in 2002.
