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Justices agree to hear Lexmark false advertising case

Tourists walk in front of the Supreme Court building in Washington, March 24, 2013. REUTERS/Jonathan Ernst
Tourists walk in front of the Supreme Court building in Washington, March 24, 2013. REUTERS/Jonathan Ernst

By Lawrence Hurley

WASHINGTON (Reuters) - The Supreme Court on Monday agreed to hear printer manufacturer Lexmark International Inc's appeal of a long-running dispute with Static Control Components Inc over replacement toner cartridges.

Lexmark asked the justices to review an appeals court ruling that said Static had standing to make false advertising claims against it.

Static claims that Lexmark falsely advertised by advising customers that Static's chips infringed upon Lexmark's intellectual property.

The two companies have been locked in litigation for over a decade. Lexmark, in an effort to prevent the practice of other companies selling re-filled, already used Lexmark cartridges, started adding microchips to its cartridges so that Lexmark printers would not work with cartridges without the technology.

Static was able to replicate the microchip technology and subsequently sold chips to companies that wanted to sell re-filled cartridges for Lexmark printers.

Lexmark sued, alleging copyright violations. Static responded by filing its own suit alleging antitrust and false-advertising claims.

The only issue left in the case is the false advertising question after a jury found that Static had not induced copyright infringement and the judge presiding over the case dismissed Static's claims.

The Cincinnati-based 6th U.S. Circuit Court of Appeals upheld all the lower court's decisions except for its dismissal of the false advertising claims.

Lexmark says Static does not have standing to make its claim because only direct competitors can make false advertising allegations.

Oral arguments and a decision are due in the court's next term, which starts in October and ends in June 2014.

The case is Lexmark v. Static Control, U.S. Supreme Court, No. 12-873.

(Reporting by Lawrence Hurley; Editing by Howard Goller, James Dalgleish and Sofina Mirza-Reid)

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