Epson hits unlicensed ink cartridges

Seiko Epson has succeeded in getting four online retailers of printer ink cartridges to stop selling a number of third-party ink cartridges designed for use in Epson printers, the Japanese company said Friday.

The four retailers are in Germany and agreed in out of court settlements to stop selling the cartridges, which Seiko Epson asserts infringe upon its intellectual property. The retailers are GEPOC Gesellschaft für Polymerchemie in Aachen; BWD Computer in Arnsdorf; Tintenshop Löhne in Bielefeld and Tinten-Toner Vertrieb in Bochum, Epson said in a statement.

The action is the latest in a string of successful attempts by the Japanese company to stamp out sales of unlicensed ink cartridges in Europe and the U.S.

Earlier this year Epson filed a complaint with the U.S. International Trade Commission against 24 companies that manufacture, import, or distribute aftermarket ink cartridges for sale in the U.S. and filed a case in the English High Court against Medea International. In 2005, Epson succeeded in reaching out of court settlements with companies in the U.K. and Hong Kong.

The sale of ink refills is a lucrative business for printer makers like Epson. It's also an important part of the business model typically used where little or no profit is made on the printer itself but later recouped on cartridge sales. Trading of unlicensed cartridges threatens to upset this business model.

In a statement, Epson said it welcomes competition from companies that are willing to license its technology to produce compatible ink cartridges but will continue to "vigorously pursue" its rights against companies that infringe upon its intellectual property rights.

Last week, Seiko Epson reported its first net loss in four years, in part because of falling prices for printer-only products as consumers switch to multifunction models. As a result, Epson plans to reduce in the next 12 months the number of stand-alone printers it offers, it said.