Lexmark International, Inc. v. Static Control Components, Inc.

Lexmark International, Inc. (plaintiff) manufactured printers and ink cartridges. Once an ink cartridge was empty, an embedded Lexmark microchip disabled the cartridge. At that point, a customer could either throw it away or return it to Lexmark for a filled cartridge with a new microchip. Static Control Components, Inc. (defendant) manufactured parts necessary to refurbish and resell Lexmark ink cartridges, including a microchip that imitated Lexmark’s microchip. Lexmark, seeking to encourage consumers to return empty cartridges directly to the company, started a program offering consumers a 20-percent discount on new cartridges if they agreed to return the used cartridge to Lexmark. Lexmark’s packaging contained a notice stating that consumers were bound to the terms of the program if they opened the box. Lexmark also sent letters to remanufacturers stating that it was illegal to use Static’s products to refurbish and resell Lexmark cartridges. Lexmark sued Static for copyright infringement. Static countersued for false advertising, claiming that Lexmark’s packaging notices and letters to remanufacturers were misleading and actionable under the Lanham Act. The district court dismissed Static’s countersuit on the ground that Static did not have standing to bring the claim. The United States Court of Appeals for the Sixth Circuit reversed. The United States Supreme Court granted certiorari.