Aftermarket Industry Champion Ed O’Connor
Smooth and smart, with a soft spot for the environment.
On May 30, the cartridge remanufacturing industry scored a massive victory that will resonate in this industry and beyond in the U.S. Supreme Court case of Impression Products v. Lexmark International. The case was a success, at its core, because of attorney Ed O’Connor.
Twenty years ago, Lexmark International announced smugly to the cartridge remanufacturing industry that it was going to sell its latest cartridges with the restriction that they couldn’t be remanufactured or recycled, because of the patent rights that Lexmark was retaining.
That sent the cartridge remanufacturing industry into a tailspin, igniting a fire under its supporters. One such supporter was attorney Ed O’Connor, whose distinguished pedigree included representing aftermarket members such as Repeat-O-Type and Independent Ink. The industry went to war with Lexmark to end its misuse of its patent rights. There were skirmishes with battles won and lost, but Lexmark’s restrictive actions continued.
Thirteen years later, Lexmark upped the ante by suing companies that were remanufacturing their “restricted” cartridges using cores first sold in Canada. Impression Products was one such defendant. Its owner, Eric Smith, outraged by Lexmark’s actions and unwilling to just submit, contacted O’Connor to fight it.
That’s when Lexmark’s winning days were numbered. It counted on its status as a multi-billion-dollar company to continue to bully the industry and roll over its small competitors. It didn’t count on Ed O’Connor.
Against Goliath, David needed to be well-represented
“For years, I have been disgusted with what is being done to this planet by the discarding of products into the air and especially into the sea,” O’Connor said. “Most, if not all, of these products are fully capable of being refurbished. I’ve also been deeply troubled by the fact that two decisions by the Court of Appeals for the Federal Circuit have been primarily responsible for this conduct. Those decisions are Jazz Photo and Mallinckrodt, both of which have provided weapons to be used in court to go after companies for patent infringement for the refurbishing of patented products which had already been sold by the OEMs.”
“I first found out about Jazz Photo when I was giving a talk, to this industry, at a trade show in Shanghai. From that day forward --almost ten years ago- I have dedicated a substantial part of my efforts and my law practice to ridding this industry of those two awful cases.”
The “awful” cases were being used by Lexmark to support their claims that their return/prebate program was legitimate. Mallinckrodt case validated single-use licenses on medical equipment. Jazz Photo raised the question of whether an overseas sale extinguished U.S. patent rights. It was the latter case that led Lexmark to sue Impression Products and dozens others over cores first sold in Canada.
“The OEMs, who were using those cases to threaten, cajole, and sue remanufacturers, also had huge resources compared to the remanufacturers. As result, those who were threatened or actually sued, usually gave in immediately.”
The financial demands of the litigation clearly favored Lexmark. Still, several defending remanufacturers fought back, at least initially. However, it was clear that these issues would not be resolved in a single trip to the courthouse. It would have to go all the way to the U.S. Supreme Court.
“The owner of Impression Products came to me after the decision of the U.S. Supreme Court in Kirtsaeng, a case which essentially held that copyrights are exhausted after first sale of the copyrighted work outside of the United States,” O’Connor said. “In my opinion, that decision would result in the reversal of Jazz Photo. As can be seen from the Supreme Court’s final decision, I was correct in that analysis.”
Many in the intellectual property legal community saw the Kirtsaeng decision as the “first shoe” to drop on international exhaustion, a relatively untried area of the law. The other shoe would drop when the legal system was presented with a case involving patent rights and overseas sales. A case that included the exact facts and legal issues as those created by Lexmark.
The fly in the ointment remained the disparity in resources between Lexmark and the small companies it had chosen to sue. Then O’Connor did the highly unusual and unthinkable: he took on Impression Products as a client at no charge (or “pro bono.”)
“I decided to take the case primarily on a pro bono basis because to charge regular fees would have run into the hundreds of thousands of dollars and possibly more than a million dollars,” O’Connor said. “I did not believe that any small company could afford that, nor did I believe that it would be fair for one company to bear the entire financial burden for this entire industry, as well as the many other industries adversely affected by those two cases. Because this was a moral issue to me, I decided to pursue it and to the carry the responsibility and the financial burden personally.”
An Ocean of Experience
In some instances, inexperienced attorneys take cases pro bono to gain expertise. And even experienced attorneys will take a high-profile case pro bono for the exposure. O’Connor needed to do neither.
Ed O’Connor serves as chair of Avyno Law’s prestigious litigation department. His expansive career includes serving:
- As a public defender in Palm Beach County, Florida
- with the Air Force J.A.G., where he wrote patent applications in computer technology, space exploration and advanced weapons systems;
- as “Senior Intellectual Property and Litigation Attorney” with Intel where he was responsible for managing Intel’s litigation;
- as patent and antitrust jury and appellate lawyer for Poms, Smith, Lande & Rose, one of the oldest patent law firms in Los Angeles.
O’Connor has previously appeared before the U.S. Supreme Court. His first case was Illinois Tool Works v. Independent Ink, (2006). O’Connor represented the aftermarket player against the major international conglomerate. This patent and antitrust case was one of many building blocks that helped the aftermarket in the Impression Products case.
e also represented Repeat-O-Type in Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp, Inc., which was tried before the Federal Circuit Court of Appeals in 1997. He obtained a summary judgment against Hewlett-Packard of non-infringement based upon a finding of successful permissible repair/reconstruction. The case is one of the leading cases of the repair/reconstruction doctrine.Ed is an internationally-recognized expert on intellectual property law. He is listed in the Los Angeles Times as one of the leading lawyers in Southern California and was listed in the San Diego Register as the only leading lawyer in both patent prosecution and intellectual property litigation.
In addition to representing clients in the United States Supreme Court, Ed has represented clients before the International Trade Commission and has won patent infringement, antitrust, and other intellectual property cases throughout the United States. Among the clients he has represented in litigation are Kawasaki (antitrust, defense); Nike (patent, defense); and Thermos (trade dress, defense).
If you are not impressed yet, O’Connor is also fluent in Spanish. He has written three books on Intellectual Property Law and Litigation, published by the American Bar Association.
Fueled by only his desire for justice
O’Connor was already well-known and highly-respected when Lexmark launched its nefarious return program and he was outspoken in his disdain for it. He leveled the playing field in a huge way when he took on the Impression Products case pro bono. That incredibly generous act was a massive game changer. And by using clever trial procedure, O’Connor was able to shorten the time it takes to transverse the playing field.
“One of the biggest problems with our court system is that it takes so long to get a case resolved. I decided to use the technique of fling a motion to dismiss (the lawsuit), which is an issue of law only, as a way of shortcutting the case,” O’Connor said. “By using that technique, I was able to avoid a trial and the attendant delay. In addition, by moving against both Jazz Photo regarding the importation of previously sold cartridges and by moving against Mallinckrodt, regarding restrictive label licenses on products (Lexmark’s return/prebate program), I created additional pressure on Lexmark.
“The trial court denied my motion to dismiss regarding the international sales issues in the case, but granted the portion regarding Lexmark’s prebate program,” O’Connor said. This put pressure on Lexmark to stipulate to the entry of final judgment on both those issues, without the necessity of a trial. Therefore, we were able to move this case to the Court of Appeals for the Federal Circuit almost immediately.
“This case was heard by the Federal Circuit en banc (meaning it was heard by the entire federal court bench- an extremely rare occurrence). The Federal Circuit’s decision, not surprisingly, was to reaffirm both of its decisions – Jazz Photo and Mallinckrodt. I was confident the U.S. Supreme Court would reverse the Federal Circuit Court, and overturn both of those horrible cases.”
The road to victory was still uphill, despite O’Connor’s cunning manipulation of civil procedure and expertise in advocacy. The wheels of justice turn slowly. The case took seven years to wend its way to the Supreme Court. And Lexmark kept the pressure on in the marketplace and the courts the entire time. But O’Connor never wavered in his support of his client, the industry and his principles. All of that just made the May 30th win all the sweeter for O’Connor.
“How would I summarize the victory? First, I consider this a personal victory for me,” O’Connor said. “I spent some ten years attempting to get rid of those cases, and suffered the slings and arrows of those who said I had no chance.
“In addition to my personal vindication, I believe this is a tremendous victory for the environment; for the economy; for those who do the right thing by recycling; for consumers who have the right to lower-cost products (the cost of replacement cartridges, for example, is downright immoral),” O’Connor said. “It is a victory not just limited to this industry. It also applies to virtually every other industry, including automotive, electronics, medical device, pharmaceutical, and so on and so forth.”
Now O’Connor can take this win and go forth to his next cause and challenge. If he chooses, say, world hunger, in about ten years, the world will be well-fed.
Sidebar: The Wit & Wisdom of Ed O’Connor.
Ed O’Connor’s passion and wit make him a formidable friend. Conversation is never light. It is rapid-fire and unrelenting. He is aptly described as “irreverent” and “distinguished” in the same sentence. His dedication to his causes is surpassed only by his dedication to his friends. Here are some fun and important “snippets” from his interview.
On his naysayers… “To all of my critics I would like to say ‘na na na na na na na.’ Now to those of my critics would say that that sounds very immature, I would point out that I never claimed to be mature in the first place. So, there.”
On his allegiance to the industry and its association… “This is a victory for those who have been tirelessly involved, in this industry in fighting to overcome these bad prior decisions. Everyone in this industry, for example, is well aware of the many efforts, for many years, made by Tricia Judge and by the International Imaging Technology Council. Tricia in particular has waged a never-ending, and often frustrating, battle to get rid of Lexmark’s horrible prebate program. Congratulations Tricia, we finally did it.”
On his devotion to a special friend, industry icon Art Diamond…”Finally, I want to say something about my recently-departed friend Art Diamond. It was because of Art that I became involved in this effort in the first place. He and I worked and talked and thought and spoke in forums throughout the world with never-ending determination to overturn those two cases. Without Art, this would never have happened. I wish you were here now to share this victory, Art. This one is for you.”