February 5, 2003 7:09 PM PST

Toner company fights DMCA lawsuit

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In a final round of skirmishing prior to a court hearing Friday, a North Carolina company argued that a controversial copyright law does not prevent it from selling computer chips that allow toner cartridges to be reused.

Static Control Components said in a legal brief filed this week that Lexmark, the No. 2 printer maker in the United States, is trying to bilk customers and stifle competition by invoking the 1998 Digital Millennium Copyright Act (DMCA).

U.S. District Judge Karl Forester has set a hearing on Lexmark's request for a preliminary injunction for Friday in Lexington, Ky., in the case, which is the first to pit the long-established right to reverse-engineer against copyright law.

In December 2002, Lexmark sued Static Control, a family-owned business in Sanford, N.C., claiming that its Smartek chips sold to toner cartridge remanufacturers violate the DMCA. The Smartek chip "circumvents the technological measure" that the printer uses to verify the cartridge is original and not remanufacturered, Lexmark claims.

On Jan. 10, Forester accepted Static Control's offer to temporarily cease manufacturing the Smartek chip until a hearing could be scheduled.

In an interview with CNET News.com on Wednesday, a top Hewlett-Packard executive slammed the printer rival for wielding the DMCA against the remanufacturing industry. "We think it is stretching it," HP Senior Vice President Pradeep Jotwani said. "The DMCA was put in place (to protect) things like movies, music and software applications."

Static Control's 41-page brief warns that if Lexmark's claims were successful, they would set a worrying precedent and cause DMCA-protected chips to sprout in many consumer products. "One readily could envision, for example, an automobile manufacturer applying technological measures...to prevent competition in the aftermarket for replacement tires, wiper blades or other automotive parts; camera manufacturers attempting to foreclose the use of competitors' lenses or brands of film; a ball-point pen manufacturer using a technological measure and an 'ink low' program to shut out replacement ink refills; or a cell phone manufacturer applying technological measures to replacement batteries," the brief says.

This lawsuit is the latest of several recent DMCA cases--both civil and criminal--that have tested the limits of the 1998 copyright law, which Congress intended to limit Internet piracy. Eight movie studios wielded it to force 2600 magazine to delete a DVD-descrambling utility from its Web site, but the U.S. Justice Department recently lost a criminal case against a Russian firm that created a program that cracked Adobe's electronic books.

Under section 1201 of the DMCA, it is generally unlawful to circumvent technology that restricts access to a copyrighted work or sell a device that can do so. But Congress also included exemptions in the DMCA explicitly permitting activities such as law-enforcement purposes, encryption research, security testing and interoperability.

Static Control has seized on the last exemption, which permits reverse-engineering "for the purpose of enabling interoperability of an independently created computer program with other programs," and says its creation of the Smartek chip is also protected by traditional fair use rights enshrined in U.S. copyright law.

Its attorneys cite the landmark 1993 Sega v. Accolade decision from the 9th U.S. Circuit Court of Appeals. In that case, the court said: "Where disassembly is the only way to gain access to the ideas and functional elements embodied in a copyrighted computer program and where there is a legitimate reason for seeking such access, disassembly is a fair use of the copyrighted work, as a matter of law."

Static Control also claims that Lexmark's code allegedly protected by the DMCA is nothing more than "than bare-bones implementations of mathematical formulae and scientific observations that cannot be protected by copyright." Lexmark uses the government-standard Secure Hash Algorithm-1 (SHA-1) to calculate a "hash" value as a way to verify that the cartridges are original.

Lexmark could not be reached for comment Wednesday.

 

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