AFTERMARKET FIGHTS BACK AND WINS!

Author: Dermot
Released 16 June 2008 - Updated 7 July 2008

PREBATE STYLE RESTRICTIONS NOW INVALID

We have been informed by the I-ITC in the USA that the "US Supreme Court has unanimously decided in favour of Quanta vs LG Electronics (and therefore the aftermarket) in a case involving restrictions that a patent holder wished to enforce on the use of it’s product after it had been sold. The Supreme Court ruled that the patent holder’s rights to use its patents were exhausted by the first sale of its products. So terms attached to an agreement were unenforceable when patents were the underlying reason to support the validity of that agreement"

"The Court confirmed that the patent exhaustion doctrine is rock solid-the US Justice Dep’t also supported Quanta’s position"

This should see the demise of Lexmark's Prebate program and a slew of other abusive practices involving patents. There are other OEM’s out there playing around with Lemark type prebate programs so I hope they get the message. 

OEM PRINTER CONSUMABLE PRICES TO BE INCREASED?

I mentioned in a previous newsletter that with rising metal and petroleum based  raw materials it would only be a matter of time before the OEM’s had to increase their prices in order to maintain their massive margins. Well it looks like it may well happen sooner than later. It has been reported that Kodak in the USA (a new entrant into the market) are to increase their prices by as much as 20%. We should open a book on who will be the next to jump on the bandwagon. There are a couple of OEM’s out there that are not performing that well. I would expect them to now re-assess their position and push up their prices. They shall remain nameless but I am sure you can all guess who they are. This is good news for our industry as higher OEM pricing translate to better margins to re-manufacturers.