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Printer cartridges may change your life, even if you don’t have a printer

(NEWS) Lexmark has decide that if customers don’t want to buy ink from them, they can face legal charges instead.



trademark lawsuit cartridges initiative

Who holds the power?

Does a patent holder have the power to dictate how you use a product after you buy it?

That’s the question that the Supreme Court would now have to settle as it hears arguments on a patent dispute case Impression Products, Inc v Lexmark International, Inc.

Case with big repercussions

Although a decision is months away, businesses like IBM and Costco, public interest groups, and legal scholars are closely following the case, since the verdict is likely to be a “major” decision with wide-ranging implications for our society.

The basics of a patent

Most products are patented. As consumers, we do not have to worry about such patents because of the legal principle of “exhaustion”.

This means that when you buy a product, you own it, and the legal patent that the manufacturer held is ‘exhausted’.

You can use, repair, donate or resell the product without any legal consequences.

Lexmark is about to ruin it for everyone

That independence may soon change, depending on how the Supreme Court’s verdict.
Lexmark sells printers and cartridges. Printers are cheap, and they last long.

Cartridges are expensive and refills are more frequent. Lexmark’s most business consists of selling cartridges.

Because new ink cartridges are expensive, consumers often look for cheaper ways to refill old ones. Many companies provide such a service. Impression Products is one of them. They sells ink by refilling cartridges, including those of Lexmark.

All about the money

Lexmark is reluctant to miss out on business of selling new ink cartridges because of competitors refilling older ones for cheap.

Their solution: use patent law to go after these entities, and restrict customers from refilling cartridges.

Trying to cut competition out is not a new strategy. Cellular providers lock devices, dissuading customers switching to competing networks. Monsanto wants farmers sowing patented seeds only. Equipment Company Deere & Co. clamp down on independent repair shops.

If at first you don’t succeed, sue them differently

Lexmark tried this approach initially and were blocked by the Courts. It argued that refills violated software locks and hence the Digital Millennium Copyright Act. U.S. Court of Appeals for the Sixth Circuit ruled against Lexmark for misapplying the scope of the Copyright Act.

When they failed the Copyright route, they took the patent route.

Lexmark began selling cartridges with a notice on the packaging: no reuse or third party transfer allowed. Voila! Refills would now be patent infringement.

Appeal away

Impression Products is now challenging the legality. But this time, Lexmark has had success with the Court of Appeals for the Federal Circuit, which hears all appeals to patent cases.

The court reasoned that so long a patent holder gives notice of restriction, the customer is bound to obey them, even after they own the product.

Its whole victory hinged on a technical argument about the 1952 Patent Act that revolves around the word “authority”.

Third-party consequences

Unsurprisingly, if the Supreme Court agrees, this would have serious consequences for third-party businesses that thrive on customer service of products of bigger companies, the resale markets and consumer choice in general.

Patent owners would suddenly have broad new powers, including suing customers who already bought their product.

For instance, if you buy a Toyota, it may be illegal for you to take it to any mechanic other than a Toyota dealer. You may be in violation of patent law if you resell your iPhone!

Power grab

The Supreme Court will likely be very wary of the implications of its own decisions. Many consumer groups are already claiming Lexmark’s arguments as an unprecedented power-grabbing tactic to corrode consumer rights in favor of bottom lines of private businesses.

The U.S. Justice Department is arguing in favor of Impression, and asking the Supreme Court to reverse part of the Appeals Court’s decision.

Tech giants like Intel and HTC have also showed support for Impression and warned major supply chain disruptions in case of a ruling favoring Lexmark.

Game changer

Lexmark supporters, meanwhile, include big pharma, patent holding companies, and IBM (only in the extraterritorial aspect)

Expert analysis of the initial arguments heard by the Supreme Court suggested that Justices are still being acquainted with the legal precedence of patent laws, and the outcome is still very much uncertain.Click To Tweet

This will be a landmark case, with implications far beyond ink. Let us hope the Justices do not blotch this one for us.


Barnil is a Staff Writer at The American Genius. With a Master's Degree in International Relations, Barnil is a Research Assistant at UT, Austin. When he hikes, he falls. When he swims, he sinks. When he drives, others honk. But when he writes, people read.

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Business News

Too connected: FTC eyes Facebook antitrust lawsuit

(BUSINESS NEWS) Following other antitrust hearings, we’re expecting to hear more about the FTC’s antitrust lawsuit against Facebook, soon.



Facebook being crossed out by a stylus on a mobile device.

Facebook might be wishing it had kept the “dislike” button.

On September 15, the Wall Street Journal announced that the Federal Trade Commission was preparing a possible antitrust lawsuit against the social media titan. Although the FTC has not made an official decision on whether to pursue the case, sources familiar with the situation expect a determination will be made on the matter sometime before the end of 2020. Facebook and the FTC both declined to comment when asked about the story.

The news comes following a year-long investigation by the FTC that has looked into anti-competitive practices by the Menlo Park-based company. This past July, the United States House of Representatives held hearings in which they grilled the CEOs of Amazon, Apple, Google, and Facebook regarding their business practices. In August, Facebook CEO Mark Zuckerberg also testified in front of the FTC as part of the department’s antitrust probe into the organization.

The FTC seems to be especially interested in Facebook’s past acquisitions of WhatsApp and Instagram, which they believe may have been done to stifle competition. In internal emails sent between Zuckerberg and Facebook’s former CFO David Ebersman back in 2012, the 36-year-old seemed worried that the apps could eventually pose a threat to the social media conglomerate.

“These businesses are nascent but the networks established, the brands are already meaningful, and if they grow to a large scale the could be very disruptive to us,” Zuckerberg wrote to Ebersman, “Given that we think our own valuation is fairly aggressive and that we’re vulnerable in mobile, I’m curious if we should consider going after one or two of them.”

When Ebersman asked him to clarify the benefits of the acquisitions, Zuckerberg stated the purchases would neutralize a competitor while improving Facebook.

“One way of looking at this is that what we’re really buying is time. Even if some new competitors springs up, buying Instagram, Path, Foursquare, etc. now will give us a year or more to integrate their dynamics before anyone can get close to their scale again.” Zuckerberg said.

This isn’t the first time the FTC has investigated Facebook either. Last year the agency fined the company $5 billion for the mishandling of user’s personal information, the biggest penalty imposed by the federal government against a technology company. As a part of the settlement with the FTC in that case, Facebook also promised more comprehensive oversight of user data.

If the FTC does pursue an antitrust suit against Facebook, it could end up forcing the social media giant to spin off some of the companies it has acquired or place restrictions on how it does business. Considering how long it will take to file the litigation and prove the case in a courtroom, however, it seems that Zuckerberg will once again be “buying time.”

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Business News

What you need to know about the historic TikTok deal (for now)

(BUSINESS NEWS) No one really knows what’s happening, but the TikTok deal’s impact on business, US-China relations, and the open internet could be huge.



Male black hands holding app opening TikTok app.

So, maybe you’ve heard that Oracle and Walmart are buying TikTok for national security!

Um, not exactly.

Also, Trump banned TikTok!

Sort of? Maybe?

But then he said he approved the Oracle-Walmart-TikTok deal!

We guess?

The terms of the proposal seem to shift daily, if not hourly. The sheer number of contradictory statements from every player suggests no one really knows what’s going on.

Just one example: Trump said the deal included a $5 billion donation to a fund for education for American youth. TikTok parent ByteDance, said, “Say what now?”

Here’s what we think we know (as of this writing):

Oracle and Walmart would get a combined 20 percent stake in a new U.S.-based company called TikTok Global. Combine that with current US investors in China’s ByteDance, TikTok’s parent, that would give American interests 53 percent. European and other investors would have 11 percent. China would retain 36 percent. (On Saturday Trump said China would have no interests at all. But that does not jibe with the reporting on the deal.)

Oracle would host all user data on its cloud, where it is promising “security will be 100 percent” to keep data safe from China’s prying eyes. But reporting has differed on whether Oracle will get full access to TikTok’s code and AI algorithms. Without full control, skeptics say, Oracle could be little more than a hosting service, and potential security issues would remain unaddressed.

Walmart says they’re excited about their “potential investment and commercial agreements,” suggesting they may be exploring e-commerce opportunities in the app.

The US Committee on Foreign Investment in the United States, which is overseen by Treasury Secretary Steven Mnuchin, still has to approve any deal.

As for the TikTok “ban” – which isn’t really a ban because current users can keep it – the Commerce Department postponed the deadline for kicking TikTok off U.S. app stores to September 27, to give time for the deal to be hammered out. Never mind that it’s still not clear whether the U.S. government has authority to do that. Unsurprisingly, ByteDance says it doesn’t in a lawsuit filed September 18.

Whatever happens with the whiplash of the deal’s particulars, there are bigger issues in play.

According to business news site Quartz, moving data storage to Oracle mirrors what companies like Apple have done in China: Appease the Chinese government by allowing all data hosting to be inside China. A similar move could “mark the US, too, shifting from a more laissez-faire approach to user data, to a more sovereign one,” says China tech reporter Jane Li.

More obvious: Corporate sales and mergers are now part of the parrying between the U.S. and China, which adds a whole new playing field for negotiations among businesses.

In the meantime, TikTokkers keep TikTokking. White suburban moms continue to lip sync to rap songs in their kitchens. Gen Z continues to make fun of the president – and pretty much everything else.

And downloads of the app have skyrocketed.

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Business News

Hobby Lobby increases minimum wage, but how much is just to save face?

(BUSINESS NEWS) Are their efforts to raise their minimum wage to $17/hour sincere, or more about saving face after bungling pandemic concerns?



Hobby Lobby storefront

The arts-and-crafts chain Hobby Lobby announced this week that they will be raising their minimum full-time wage to $17/hour starting October 1st. This decision makes them the latest big retailer to raise wages during the pandemic (Target raised their minimum wage to $15/hour about three months ago, and Walmart and Amazon have temporarily raised wages). The current minimum wage for Hobby Lobby employees is $15/hour, which was implemented in 2014.

While a $17 minimum wage is a big statement for the company (even a $15 minimum wage cannot be agreed upon on the federal level) – and it is no doubt a coveted wage for the majority of the working class – it’s difficult to not see this move as an attempt to regain public support of the company.

When the pandemic first began, Hobby Lobby – with more than 900 stores and 43,000 employees nationwide – refused to close their stores despite being deemed a nonessential business (subsequently, a Dallas judge accused the company of endangering public health).

In April, Hobby Lobby furloughed almost all store employees and the majority of corporate and distribution employees without notice. They also ended emergency leave pay and suspended the use of company-provided paid time off benefits for employees during the furloughs – a decision that was widely criticized by the public, although the company claims the reason for this was so that employees would be able to take full advantage of government handouts during their furlough.

However, the furloughs are not Hobby Lobby’s first moment under fire. The Oklahoma-based Christian company won a 2014 Supreme Court case – the same year they initially raised their minimum wage – that granted them the right to deny their female employees insurance coverage for contraceptives.

Also, Hobby Lobby settled a federal complaint in 2017 that accused them of purchasing upwards of 5,000 looted ancient Iraqi artifacts, smuggled through the United Arab Emirates and Israel – which is simultaneously strange, exploitative, and highly controversial.

Why does this all matter? While raising their minimum wage to $17 should be regarded as a step in the right direction regarding the overall treatment of employees (and, hopefully, $17 becomes the new standard), Hobby Lobby is not without reason to seek favorable public opinion, especially during a pandemic. Yes, we should be quick to condone the action of increasing minimum wage, but perhaps be a little skeptical when deeming a company “good” or “bad”.

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