Lexmark invokes DMCA in toner suit (yeah, you read that right!)

[wessman]

Yet another example of a how poorly written the DMCA is...

Lexmark invokes DMCA in toner suit
By Declan McCullagh
Staff Writer, CNET News.com
January 8, 2003, 7:28 PM PT
http://news.com.com/2100-1023-979791.html

Printer maker Lexmark has found an unusual weapon to thwart rivals from selling replacement toner cartridges: the Digital Millennium Copyright Act.

A federal judge in Kentucky has scheduled a hearing for Thursday in the case, which Lexmark filed against Static Control Components in an effort to slam the brakes on the toner cartridge remanufacturing industry. Lexmark is the No. 2 printer maker in the United States, behind Hewlett-Packard, and manufactures printers under the Dell Computer brand.

This lawsuit is the latest of several recent DMCA cases--both civil and criminal--that have tested the limits of the 1998 copyright law, which Congress intended to limit Internet piracy. Eight movie studios wielded it to force 2600 magazine to delete a DVD-descrambling utility from its Web site, but the Justice Department lost a case last month against a Russian firm that created a program that cracked Adobe's electronic books.

Lexmark claims that Static Control violated the DMCA by selling its Smartek chips to companies that refill toner cartridges and undercut Lexmark's prices.

The legal action escalates what has been a technological cold war pitting the aftermarket ink and toner industry against printer manufacturers, who try to prevent customers from buying products from third parties. In an essay titled "OEM Warfare," Static Control CEO Ed Swartz says: "The OEMs will continue to escalate their technologies to erect barrier after barrier to our industry. Each barrier will require an ever growing amount of time, money, talent and effort to overcome."

Under section 1201 of the DMCA, it is generally unlawful to circumvent technology that restricts access to a copyrighted work.

In a 17-page complaint filed on Dec. 30, 2002, the company claims the Smartek chip mimics the authentication sequence used by Lexmark chips and unlawfully tricks the printer into accepting an aftermarket cartridge. That "circumvents the technological measure that controls access to the Toner Loading Program and the Printer Engine Program," the complaint says. The Toner Loading Program checks toner levels in the cartridge, and the Printer Engine Program controls operations such as paper feed and the actual transfer of the dry ink to paper.

Lexmark is asking U.S. District Judge Karl Forester to order Static Control to "deliver up for destruction" all Smartek chips and to cease selling them. Static Control could not be reached Wednesday for comment.

Jessica Litman, a professor at Wayne State University who specializes in copyright law, said it's likely that Lexmark would not have been able to succeed in its lawsuit without the DMCA, but stands a good chance with it.

Pre-DMCA cases involving video game consoles concluded that it was legal to copy code for the purposes of interoperability, Litman said. In the Sony v. Connectix, the 9th U.S. Circuit Court of Appeals concluded that it was legal for Connectix to copy the Sony PlayStation's BIOS for the purpose of interoperability.

"I think they almost certainly would have skated were it not for the existence of the DMCA," Litman said of Static Control. "I would have expected the eastern district of Kentucky to follow the 9th Circuit to say that reverse engineering and copying of the code was fair use because it was enabling interoperability."

Cindy Cohn, an attorney at the Electronic Frontier Foundation, a civil liberties group in San Francisco that's one of the chief critics of section 1201 of the DMCA, said she expected more cases like the one brought by Lexmark.

"We have long said that the DMCA's potential use as an anti-competitive tool has been great," Cohn said. "Now we're seeing it happen."

Lexmark's complaint also alleges traditional copyright infringement, saying the Smartex chips contain "unauthorized, identical copies of Lexmark's copyrighted Toner Loading Programs."


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[Bytronix]

Ok, now let's see if I can download some toner through Kazaa. :)

[wessman]

HP criticizes Lexmark for invoking DMCA
By Ian Fried, Staff Writer, CNET News.com
February 5, 2003, 2:22 PM PT
http://news.com.com/2100-1040-983518.html

A top Hewlett-Packard printer executive said that although intellectual property rights are vital in the printer industry, rival Lexmark is wrong to try and use a controversial copyright law to safeguard those rights.

In an interview with CNET News.com, HP Senior Vice President Pradeep Jotwani said Lexmark is using the 1998 Digital Millennium Copyright Act in ways it was not intended in pursuing a lawsuit against a maker of remanufactured toner cartridges.

"We think it is stretching it," Jotwani said of the Lexmark suit, which was filed Dec. 30 against Static Control Components, a maker of remanufactured toner cartridges. "The DMCA was put in place (to protect) things like movies, music and software applications."

Jotwani said HP will protect its intellectual property rights if companies infringe on them but the DMCA is not the right weapon to use. A Lexmark representative declined to comment specifically on Jotwani's remarks.

"I don't plan on going down that path," Jotwani said, referring to using the DMCA.

HP did threaten last year to use the DMCA to pursue a team of researchers who demonstrated a bug in its Tru64 Unix operating system. However, the company later backed down.

The issue is a critical one for HP, Lexmark and nearly all printer makers. Ink is the lifeblood of the industry, with supplies accounting for the bulk of profits. In HP's case, its printing and imaging business makes more money than the company as a whole, with much of the profits coming from its supplies business, which Jotwani heads.

Jotwani said that although HP thinks its own supplies deliver the best quality and value for most customers, he believes there should be a place for those companies that sell refilled cartridges and refill kits.

"I think customers draw the line. Part of that choice is they can choose our original supplies, which is always what we'd like them to do. But there is a segment of the market that is cost-conscious that draws a different line." Jotwani said that HP makes its inkjet cartridges refillable, although on some models some high-end features such as ink-level monitoring are disabled once a cartridge is refilled.

"We consciously make sure that our cartridges are reusable and refillable," Jotwani said. The company does put some limits on the practice, such as adding software that makes its cartridges unusable after a certain expiration date--either four-and-a-half years after manufacture or more than two years after a cartridge is installed.

Gary Peterson, who covers the inkjet printing arena for market researcher ARS said that HP makes refilling technically feasible, but still tries to discourage consumers in other ways.

"It is easy to refill HP cartridges," he said. "They do allow that to happen."

However, Peterson said HP has done other things, such as suing manufacturers for patent infringement and trying to keep refilled cartridges off the shelves of well-known stores.

"They put as much heat as possible on retailers" not to carry remanufactured cartridges, Peterson said.

HP has also made moves that make it more desirable for consumers to get a new cartridge, such as moving the print nozzles onto the cartridge. Those nozzles can get blocked or fire less accurately after a period of time, Jotwani said.

"What we have tried to do is, the stuff that lasts for a long time we put in the printer," he said. "The stuff we have to change, we put in the consumable."


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Copyright ©1995-2002 CNET Networks, Inc. All rights reserved.

[wessman]

Toner company fights DMCA lawsuit
By Declan McCullagh, Staff Writer, CNET News.com
February 5, 2003, 7:09 PM PT
http://news.com.com/2100-1023-983560.html

In a final round of skirmishing before a court hearing Friday, a North Carolina company argued that a controversial copyright law does not prevent it from selling computer chips that allow toner cartridges to be reused.

Static Control Components said in a legal brief filed this week that Lexmark, the No. 2 printer maker in the United States, is trying to bilk customers and stifle competition by invoking the 1998 Digital Millennium Copyright Act (DMCA).

U.S. District Judge Karl Forester has set a hearing on Lexmark's request for a preliminary injunction for Friday in Lexington, Ky., in the case, which is the first to pit the long-established right to reverse engineer against copyright law.

In December 2002, Lexmark sued Static Control, a family-owned business in Sanford, N.C., claiming that its Smartek chips sold to toner cartridge remanufacturers violate the DMCA. The Smartek chip "circumvents the technological measure" that the printer uses to verify the cartridge is original and not remanufacturered, Lexmark claims.

On Jan. 10, Forester accepted Static Control's offer to temporarily cease manufacturing the Smartek chip until a hearing could be scheduled.

In an interview with CNET News.com on Wednesday, a top Hewlett-Packard executive slammed the printer rival for wielding the DMCA against the remanufacturing industry. "We think it is stretching it," HP Senior Vice President Pradeep Jotwani said. "The DMCA was put in place (to protect) things like movies, music and software applications."

Static Control's 41-page brief warns that if Lexmark's claims were successful, they would set a worrying precedent and cause DMCA-protected chips to sprout in many consumer products. "One readily could envision, for example, an automobile manufacturer applying technological measures...to prevent competition in the aftermarket for replacement tires, wiper blades or other automotive parts; camera manufacturers attempting to foreclose the use of competitors' lenses or brands of film; a ball-point pen manufacturer using a technological measure and an 'ink low' program to shut out replacement ink refills; or a cell phone manufacturer applying technological measures to replacement batteries," the brief says.

This lawsuit is the latest of several recent DMCA cases--both civil and criminal--that have tested the limits of the 1998 copyright law, which Congress intended to limit Internet piracy. Eight movie studios wielded it to force 2600 magazine to delete a DVD-descrambling utility from its Web site, but the U.S. Justice Department recently lost a criminal case against a Russian firm that created a program that cracked Adobe's electronic books.

Under section 1201 of the DMCA, it is generally unlawful to circumvent technology that restricts access to a copyrighted work or sell a device that can do so. But Congress also included exemptions in the DMCA explicitly permitting activities such as law enforcement purposes, encryption research, security testing and interoperability.

Static Control has seized on the last exemption, which permits reverse engineering "for the purpose of enabling interoperability of an independently created computer program with other programs," and says its creation of the Smartek chip is also protected by traditional fair use rights enshrined in U.S. copyright law.

Its attorneys cite the landmark 1993 Sega v. Accolade decision from the 9th U.S. Circuit Court of Appeals. In that case, the court said: "Where disassembly is the only way to gain access to the ideas and functional elements embodied in a copyrighted computer program and where there is a legitimate reason for seeking such access, disassembly is a fair use of the copyrighted work, as a matter of law."

Static Control also claims that Lexmark's code allegedly protected by the DMCA is nothing more than "than bare-bones implementations of mathematical formulae and scientific observations that cannot be protected by copyright." Lexmark uses the government-standard Secure Hash Algorithm-1 (SHA-1

Lexmark could not be reached for comment Wednesday.


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[wessman]

Lexmark wins injunction in DMCA case
By David Becker, Staff Writer, CNET News.com
February 27, 2003, 5:04 PM PT
http://news.com.com/2100-1028-990501.html

Printer maker Lexmark International Group won a preliminary injunction Thursday in efforts to prevent a company from selling computer chips that allow toner cartridges to be recycled.

Judge Karl Forester of the U.S. District Court for the Eastern District of Kentucky issued the pretrial injunction against Static Control Components, a small Sanford, N.C.-based company that sells printer parts and other business supplies.

The order prohibits the company from selling its Smartek chip. When installed in compatible Lexmark printers, the chips allow the printers to use cheaper recycled toner cartridges that would otherwise be rejected by the printer's sensors.

Lexmark filed the suit late last year, alleging the Smartek chip violates the Digital Millennium Copyright Act, which prohibits the dismantling of devices intended to protect intellectual property rights.

Printer makers have employed a variety of technological means in recent years to undercut the market for recycled toner and ink cartridges, which typically sell for much less than original items. Most printer makers sell their printers at or near cost, making their profit from sales of supplies.

Lexmark is the No. 2 seller of printers in the United States, behind Hewlett-Packard, and manufactures printers under the Dell Computer brand.

Anti-circumvention language in the DMCA has been a foundation for a number of recent copyright actions, including the Justice Department's crackdown earlier this week on a site distributing "mod chips" for Microsoft's Xbox video game console.


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