The best thing about purchasing a printer is that you not only get the device, but also ink to get started. The worst thing is that, when the ink runs out, you need to purchase more. When shopping for new cartridges, sticker shock sets in. On far too many occasions, the ink ends up costing almost as the initial outlay for the printer.
Impression Products and other companies are in the business acquiring, restoring and reselling used cartridges. By counteracting a microchip installed to prevent reuse, they refurbish the cartridge and significantly undercut the prices charged by Lexmark International and other titans of “Big Ink.”
To counter the renovation practice, Lexmark developed a return program. Customers who agreed to return them received a 20 percent discount.
Lexmark tried to prevent third parties from acquiring, refurbishing and reselling its used cartridges by creating a “return program.” Customers who bought cartridges would agree to return them got 20 percent off their cost.
The case was heard before the Supreme Court. All justices (Justice Neil M. Gorsuch didn’t participate in the case) agreed that patent holders that restrict use or resale of their printer ink cartridges cannot invoke patent law against a manufacturing company that violates the restriction.
In spite of restrictions imposed by Lexmark and their contracts with customers, patent rights are exhausted with the first sale of the cartridges. Justice Ruth Bader Ginsburg, while agreeing with the conclusions, would not have held that Lexmark’s patent is not exhausted for foreign sales.
Lexmark had support from biotechnology, drug and agricultural industries. Google and other Silicon Valley companies backed Impression Products, as did sellers of refurbished auto parts and medical devices.