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      Court quashes
rather were repairing and modifying the existing cartridge.
The High Court of Australia has agreed with the importer. It found that when the cartridges were sold by the manufacturer to a customer, the customer then becomes entitled to do what it likes with the product. This is referred to as the “exhaustion doctrine” and means that once a product is sold the company that created the product no longer can make a claim on the intellectual property of the product.
The High Court also emphasised the importance of setting out matters of intellectual property in contracts where you do not want the exhaustion doctrine to apply.
This decision highlights the importance of strong contracts and clear legal advice. Contracts allow specific requirements to be set out and can prevent misunderstandings from occurring. They set out rights and obligations and limit disputes. Never underestimate the value of
a written contract in providing certainty and clarity to your business.
Printer warranty
As far as the thorny question of whether using non–authorised
third party consumables voids the warranty on hardware, the decision above does not decide that issue. It addresses the issue of intellectual property rights, and if they continue to be owned by the manufacturer after the product is sold.
For the warranty it is possible
to have a condition in a contract whereby a warranty is voided in certain circumstances, such as using a cartridge other than brand X. A condition similar to that would be enforceable.
If however there is no such contractual term, then unless the cartridge is shown to be the cause of a fault with the printer, for example, then it is less likely to be the basis for voiding the warranty. 21
For more information contact Wal at Fox & Staniland Lawyers, Gordon, NSW Tel 02 9440 1202
Wal Abramowicz, managing director, Fox & Staniland
cartridge claims
The High Court has extinguished manufacturers’ claim on refurbished printer cartridges. The ruling does not directly impact on voiding warranty with third party inks.
Printer cartridges are a profit maker for printer manufacturers. Until recently, the cartridge market has been
tightly controlled by the printer manufacturers and many cartridges are designed to be single use.
However, refurbished cartridges, involving a third-party company taking spent printer cartridges and re-filling them for further sale and use has grown in recent years to become a popular alternative.
The High Court of Australia recently dealt with the of issue whether refurbished printer cartridges are an illegal resale
of a company’s product. In 2016
a company began importing refurbished cartridges for a well known printer brand from Malaysia. The Malaysian company would replace computer chips on the cartridges, clean them and make modifications to the cartridges to enable them to refill them. This included drilling holes and placing new seals on the cartridges.
The manufacturer saw the unapproved refurbishment and re- sale of its cartridges as a violation of its intellectual property.
Intellectual property refers
to creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce.
The manufacturer argued that the refurbishment “materially altered” the product: the purpose of the cartridges was to have a short life and to not be reused.
As the refurbishment enabled the cartridges to be reused and sold by
a third party, which Epson did not want, the company believed their product was being used to create a new product without their consent.
The importers argued that as the cartridges had already been purchased, they were entitled
to make changes to them to prolong their life and make them more useful. By refurbishing the cartridges, the importer claimed that they were not creating a new cartridge or product for sale, but
Third party ink: court ruling
        50   Print21 JANUARY/FEBRUARY 2021

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