Fans of Cheap Drugs and Printer Ink Just Won Big in the Supreme Court

[mahatmakanejeeves]

Source: Gizmodo

Fans of Cheap Drugs and Printer Ink Just Won Big in the Supreme Court

Adam Clark Estes
Today 3:25pm

On Tuesday, a scary case reached a surprisingly positive outcome (1) in the Supreme Court of the United States. Impression Products, Inc. v. Lexmark International, Inc. was seven-year-long standoff between a small business and an international corporation and stood to upend the world of consumer rights, especially for tech and pharmaceutical companies. Guess what: the little guy won.

At its core, Impression v. Lexmark was a tricky patent case. (2) Impression Products, a 25-employee outlet, built its business by buying used printer cartridges, refilling them, and reselling them to consumers. This introduced some welcome competition into the otherwise twisted and monopolistic world of consumer printers and, as a result, made it possible for consumers to save some coin. Obviously, the massive printer empire that is Lexmark did not like this and started suing small companies like Impression a few years ago, based on an idiosyncratic piece of patent law. Impression, the only company that refused to settle, took the case all the way to the Supreme Court and emerged victorious.

In a quasi-unanimous decision, the Supreme Court ruled that Lexmark exhausted its patent rights as soon as it sold printer cartridges both domestically and abroad. (Justice Ruth Bader Ginsberg dissented on the international issue, and Justice Neil Gorsuch was not involved in the case.) The implications of this ruling arent just positive for small printer cartridge-refilling companies either. Had Lexmark won, the decision wouldve changed the way aftermarket sales work in all kinds of industries, namely the pharmaceutical industry.

(1) http://www.ipwatchdog.com/2017/05/30/supreme-court-lexmark-sales-exhausted-patent-rights/id83824/

(2) https://www.usnews.com/news/us/articles/2017-05-30/us-top-court-restricts-patent-owners-right-to-block-resale-of-goods

Read more: http://gizmodo.com/fans-of-cheap-drugs-and-printer-ink-just-won-big-in-the-1795662756

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[link:http://www.ipwatchdog.com/2017/05/30/supreme-court-lexmark-sales-exhausted-patent-rights/id83824/Supreme Court rules Lexmark sales exhausted patent rights domestically and internationally]

By Gene Quinn
May 30, 2017

Earlier this morning the United States Supreme Court issued an opinion in Impression Products, Inc. v. Lexmark International, Inc., (3) a case requiring the Court to revisit the patent exhaustion doctrine. In an opinion authored by Chief Justice John Roberts, and joined by all members of the Court except Justice Ginsburg (concurring in part and dissenting in part) and Justice Gorsuch (taking no part in the case), the Supreme Court determined that when a patent owner sells a product the sale exhausted patent rights in the item being sold regardless of any restrictions the patentee attempts to impose on the location of the sale. In other words, a sale of a patented product exhausts all rights both domestic and international.

(3) https://www.supremecourt.gov/opinions/16pdf/15-1189_ebfj.pdf

[Marthe48]

1. Is this going to impact Kirtsaeng v. John Wiley & Son

I didn't ever hear if Kirtsaeng v. John Wiley & Son was settled or how. It was about your right to sell things you had bought.

http://www.marketwatch.com/story/your-right-to-resell-your-own-stuff-is-in-peril-2012-10-04?pagenumber=1

[Ms. Toad]

17. Copyright and patents are two different bodies of law

So not directly, anyway. But Kirtsaeng is consistent with and predicted the outcome in this case.

Kirtsaeng was about the first sale doctrine. Basically, as long as you are not reproducing the item protected by copyright that you purchased, it is yours to do what you want with - and whether that applies to copies made abroad. In the publishing industry, textbooks are generally much cheaper overseas. Some enterprising foreign students started bringing foreign-made textbooks into the US and selling them (much more cheaply) in the US market.

Patent exhaustion is a similar doctrine in patent law.

Lexmark was trying to prevent subsequent resale (for refilling) of its patented ink cartridges by contract - and to restrict (like Kirtsaeng) goods made for the foreign market from entering the US. The Supreme Court said, "Nope. You get to profit from the first time the item is sold, and then your patent rights are exhausted.

[Marthe48]

20. Thank you for the understandable comparison

My husband and I collected for over 40 years. Was worried about the value of our collection going to zero, so I was watching the Kirtsaeng, because of the extremes it could go to.

[bucolic_frolic]

2. Goodness, sounds like a challenge to the DMCA might have an opening

[Ms. Toad]

18. DMCA doesn't cover patents. n/t

[riversedge]

3. I buy the refills or off brands. I did not know this was a court case. whow.

[hibbing]

4. Thanks for posting this n/t

[FakeNoose]

5. Awesome news!

I've been paying the "Canon tax" for years and it chaps my ass.

If you don't know what the "Canon tax" is you've probably never owned a Canon-brand inkjet printer. The printers are actually good quality and easy to use. You see them everywhere in Best Buy, Amazon, Target, Walmart. The printer comes with ink cartridges and the printers cost around $60/70/80 depending on the features.

So when it comes time to buy more ink, you find out that it costs almost as much (roughly $50) to buy new ink cartridges as what you paid for the printer itself, when the "free" ink was included. You say that sucks, and you look around for other brands that fit your printer. Then you find out there are no other brands of ink that work in your printer. You have to buy Canon's cartridges, and pay for *almost* the cost of a new printer every time.

The same thing happened to me when I owned a Lexmark printer, except I hated that printer and replaced it - with a Canon. These replacement ink companies are providing a much-needed product and they're still making very good profits. Just not insane profits, like the inkjet printer companies are.

The SCOTUS has done us a very big favor!

[msongs]

6. there are not-canon inks and carts available for many canon printers. perhaps not yours tho nt

[mahatmakanejeeves]

9. I was able to refill Canon cartridges, but admittedly, this was on old Canon printers.

I've never been able to refill an HP cartridge. I end up with ink everywhere but where I want it.

Nothing generic works for your Canon?

I've seen a new printer at Walgreens for $19.95, which included a starter cartridge. Buy, use, throw away. Lather, rinse, repeat.

[FakeNoose]

11. Sure but wouldn't you rather buy them for $5?

I mean it's about 25-cents worth of ink in there.

Just sayin'

[NYC Liberal]

13. And help the environment.

Buying an entire new printer every time you run out of ink is hardly environmentally friendly. Not that people have had a real choice (until now). But that's another benefit to this!

[mopinko]

14. epson may be worse. there used to be aftermarket carts that i bought

at the big box office store. went in there one time to get them and where they were there was a sign that said that the product was no longer available due to "a decision by the wto".
then they started w the chips that wouldnt let the printer accept refilled carts or after market carts. these days my hp accepts after market carts, but the last one i had would refuse to recognize them.

i held on to an old xerox printer for a long, long time when this crap all started.

[Egnever]

24. Actually Epson now offers printers with refillable tanks.

As far as I know they are the only printer manufacturer to do so. Admittedly those printers cost more up front but the ink refills are dirt cheap.

Check out the eco line of printers from epson.

https://epson.com/ecotank-super-tank-printers

[mopinko]

25. i've looked at them.

i need large format, so i am waiting for them to expand the line.
by 'everyday', they mean this is not one of their higher quality printers.

it's a good move on their part, tho. and i hope they sell a brazillion of them.

[Egnever]

26. Not sure what you are printing but the WorkForce ET‑16500

is a pretty fully featured printer.

If you are looking for professional quality prints though I understand and hope they do the same for the higher end printers.

[chillfactor]

7. I love it....

when the little guy wins!

[Scurrilous]

8. K&R

[toddwv]

10. This has some pretty major implications that they'll be sorting out for a long time.

Great news!

Even weirder, John Edwards actually came down on the side of small businesses.

[left-of-center2012]

12. (roughly $50) to buy new ink cartridges

Same for my Epson. There are generic or refills, but I usually have problems with them.
For example, my last purchase of generics, the red ink did not work.

[mopinko]

19. yeah but.

i have a big epson whose archival ink notoriously destroys the printhead. and a new printhead is almost the same a new printer.

i have a friend that is a pro graphic designer who does a lot of printing. he swears by vermont ink.

they way they blow ink all the time to keep the printhead clean pisses me off, too. not that hard to engineer a little pad that clears the ink instead of wasting it keeping it clear. especially if you dont use it that often. which, being a large format printer, i dont.

[stuffmatters]

15. The lifesaving win is it allows US cheaper drug reimportation from Canada, Mexico

Any drug sold at cheap rates by Pharma to other countries, that control drug prices thru single payer to a fraction of what we're bilked, now those drugs and prices can be freed from the patent reimportation price protections that have denied American consumers the right to buy ("reimport&quot the same drugs at international, way lower prices..

Wow, this is a potentially a trillion dollar judgment for Americans unless drug companies have a second line of defense.

[Hamlette]

16. what the hell are "aftermarket pharmaceuticals"

sounds unpleasant but I admit I have no idea what they are talking about.

[stuffmatters]

21. I believe it applies to US patent protected drugs sold internationally for way less than US prices

After the initial sale("aftermarketmarket&quot the prices via patent are no longer protected. And the ruling stated both nationally and, key for drug reimportation, "internationally"

When you think of it, doesn't this already apply to so much. How much does any writer or artist receive for a painting or a copy of
a book after the first sale?...or actually any copyrighted or patented product sold at a garage sale, resale store, craigslist...the list and circumstances infinite. So why were bottles of pills and printer cartridges protected anyway?

Freeing "aftermarket" pharmaceuticals augers beaucoup pleasantness for American consumers I hope!

[Hamlette]

22. Ah, thanks. I envisioned the drugs being used up, like the cartridge, and then resold.

This is, you can go to Canada and buy cheap drugs and sell them in the US for less than the company charges US customers.

That is good.

[mahatmakanejeeves]

23. Supreme Court Rules Patent Laws Can't Be Used to Prevent Reselling

Supreme Court Rules Patent Laws Can't Be Used to Prevent Reselling

New York Times - ?55 minutes ago?

The Supreme Court ruled that Lexmark International could not use patent law to stop companies from refilling and selling its toner cartridges.

[Yavin4]

27. I stopped buying printers altogether because of the cartridge issue

I don't print that often, and if I do, I print at work. If I can't print at work, I go to Kinkos or to the library. My needs are covered.

[mahatmakanejeeves]

28. How a Supreme Court ruling on printer cartridges changes what it means to buy almost anything

How a Supreme Court ruling on printer cartridges changes what it means to buy almost anything

By Brian Fung May 31 at 10:18 AM

Last week, the Supreme Court dealt a major blow to corporations that try to use patent law as a weapon against other firms, saying that companies can only be sued for patent infringement in the places they actually do business.

Now, the Court has ruled again along those same lines, handing a victory to consumer groups in a case about printer cartridges — or more specifically, toner cartridges, the kind used by laserjet printers. The case has huge implications for the way we think about technology ownership in America, and your rights as a user. Here's what you need to know.

What's this case all about?

The case is called Impression Products v. Lexmark. Lexmark does a lot of business with corporate customers, so if you work in an office, you might know the name from seeing it on your printers there. Those machines rely on toner cartridges, which must be changed every so often when they run out, just like ink cartridges in your home printer. And just like home printing, laserjet printing hinges on a razor-and-blades business model where much of the manufacturer's income depends on the reliable sale of new toner cartridges.

To protect its business model, Lexmark basically did some things that made it harder for people to get cheap, used cartridges on the secondhand market. Those tactics were designed to make it more likely for customers to choose Lexmark's own cartridges, according to the Court. While there's nothing specifically illegal about this, the Court said, a company such as Lexmark can't try to use patent law to stop other companies, such as Impression, from reselling its old cartridges.
....

Brian Fung covers technology for The Washington Post, focusing on telecommunications, Internet access and the shifting media economy. Before joining The Post, he was the technology correspondent for National Journal and an associate editor at the Atlantic. Follow @b_fung