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Epson Files Lawsuit Against,,, & leading Distributor

Quoting from Recharger Magazine: June 21, 2007 "Epson filed a patent infringement lawsuit in the U.S. District Court in Portland, Ore., against a large wholesale distributor and three internet retailers of ink cartridges. The complaint, filed by Epson Portland Inc., Epson America Inc., and Seiko Epson Corp. alleges that these four companies infringe a total of 18 patents that cover cartridges for Epson’s desktop and large-format inkjet printers. Epson seeks both permanent injunctions against continuing infringements and compensatory damages."

"The internet retailers are: E-Babylon Corp. dba, a subsidiary of Valueclick Inc. of Westlake Village, Calif.; Linkyo Corp. dba of City of Industry, Calif.; and PrintPal Inc. dba of Medford, Ore."

“Epson will continue taking enforcement action at whateverlevel of distribution may be required to prevent unfair competition,”said Liz Leung, Epson America’s Director of Supplies Marketing. “We have observed that some resellers are still trying to grow sales without apparent concern about liability for patent infringement. Resellers should be mindful that patent infringements can result in very substantial compensatory damages. We also urge resellers to be especially cautious regarding claims that cartridges offered to them are “patent free.” It is easy to make claims that cartridges do not infringe, but those claims do not provide a defense against damage claims for the resale of infringing cartridges.”

The actual case is: Seiko Epson Corporation et al v. E-Babylon, Inc. et al Assigned to: Magistrate Judge Janice M. Stewart Cause: 35:271 Patent Infringement

Looking at PACER, which is an electronic public access service that allows users to obtain case and docket information from Federal Appellate, District and Bankruptcy courts, and from the U.S. Party/Case Index, all Defendant's have filed answers to Amended Complaint for Patent Infringement. At this point in time certain Epson ink cartridges will not be available for sale. We will strive to keep our customers up to date on the resulting lawsuit.

January 15, 2008 "President George W. Bush and the Office of the U.S. Trade Representative allowed the 60-day Presidential Review Period to expire without modifying the General Exclusion Order by the U.S. International Trade Commission that bars all imports of infringing cartridges. As a result, the order is being actively enforced by the U.S. Customs and Border Protection Service.

The General Exclusion Order and Cease and Desist Orders do not bar imports or resale of non-infringing cartridges, like non-infringing refilled cartridges. Resellers should be cautious, however, to avoid liability by noting the following legal parameters:

1) Refilling an infringing cartridge, like an infringing aftermarket cartridge, still results in another infringing cartridge.

2) Refilled cartridges that were Epson branded cartridges must have been first sold by Epson to consumers in the United States. A "first sale" exception to patent law allows the resale of refilled patented devices that were first sold in the United States by the patent holder. Cartridges that were first sold by Epson to consumers outside the United States and refilled by a third party still infringe Epson's patents. Epson officials have observed that some suppliers commingle cartridges first sold by Epson in the United States with cartridges first sold to consumers outside the United States in identical packaging, so resellers cannot reliably avoid liability for patent infringement.

3) The refilling process must be limited to legally permissible repair to restore the cartridge to usable condition, but the cartridges cannot be completely reconstructed. Legally permissible repair includes refilling the ink, resetting the IC chip, removing or covering Epson labels, and repackaging.

4) Refilled cartridges must be prominently described at point of sale and on packaging as "refilled" or "remanufactured." Any Epson trademarks must be removed so consumers cannot be misled into believing that the cartridges were refilled or approved by Epson.

"“Epson is pleased that U.S. Customs is now effectively enforcingthe ITC Orders to prevent unfair competition,“ said Elizabeth Leung, director of Consumer Supplies, Epson America Inc. “Distributors and retailers in every market channel can expect Epson to continue vigorous enforcement against any infringers who try to undermine the commendable efforts of all the resellers who compete fairly.“"

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