Refurbished Ink Cartridges Correctly Excluded From Entry, CBP Rules

An importer of refurbished ink cartridges didn't provided enough proof to show the cartridges were originally bought in the U.S., CBP said in a recently released ruling from March 18 (here). CBP said in HQ H270324 that the cartridges fell within the scope of an International Trade Commission general exclusion order (GEO) related to patent infringement. "The issue presented is whether the patent rights practiced by the refurbished ink cartridges and inkjet cartridges of the excluded shipment have been exhausted by a first sale and thereby fall within the scope of the ITC’s general exclusion," the agency said.

CBP stopped a shipment of cartridges at the Port of Los Angeles on July 16, 2015, imported by Easy Group because of a GEO on goods that infringe on patents owned by Hewlett-Packard. Easy Group protested the exclusion and CBP requested documentation from the company about the suppliers and steps taken to keep separate the cartridges bought in the U.S. from those bought abroad, CBP said. While Easy Group did give CBP a statement from the remanufacturer, the company didn't provide the other requested documentation, CBP said.

Easy Group asserted that while there's no question whether cartridges include the patented technology, the imported cartridges were originally bought in the U.S. and "permissibly repaired and subject to an exhausting first sale under U.S. patent law," CBP said. "Certain rights accompany the purchase of a patented article, one of them being the right of repair," but "the burden is on the Protestant to show that the ink cartridges at issue have been the subject of permissible repair and not a complete reconstruction of the toner cartridges," the agency said.

The information provided by Easy Group from the remanufacturer was lacking as proof of the first sale in the U.S., CBP said. "No identifiable person at any of the entities involved in the supply of inkjet cartridges has supplied a statement affirming the facts alleged by the manufacturer," it said. "This is insufficient to meet the evidentiary burden carried by Protestant to establish that a patent exhausting first sale has been effected." Even though the process detailed by Easy Group would fall under "permissible repair," absent "a procedure to segregate goods purchased or collected in the United States from other countries it is impossible for CBP to determine whether the inkjet cartridges at issue were originally purchased" in the U.S, CBP said. The cartridges were properly excluded under the GEO, CBP said.