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Administrative Law Keyed to Popper
Lexmark International, Inc. v. Static Control Components, Inc.
Citation:
134 S. Ct. 1377, 572 US 118 (2014)Facts
Lexmark manufactures laser printers and toner cartridges, and created a “Prebate” program offering customers a 20% discount if they agreed to return used cartridges only to Lexmark. To enforce this, Lexmark installed microchips in cartridges that disabled them after use. Static Control, though not a direct competitor of Lexmark, developed microchips that could mimic Lexmark’s chips, allowing third-party remanufacturers to refurbish and resell Prebate cartridges. Lexmark sued Static Control for copyright violations, and Static Control counterclaimed, alleging that Lexmark engaged in false advertising by misleading consumers about their obligation to return cartridges and by sending letters to remanufacturers falsely stating that using Static Control’s products was illegal. Static Control alleged these misrepresentations damaged its business reputation and diverted sales.
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