Case Law | Class Action Lawsuit | Business

Introduction: Pushing Proprietary Cartridges

In a notable decision for printer OEMs, U.S. District Judge Martha Pacold in Chicago has dismissed a proposed class action against HP Inc., which accused the company of unlawfully pushing consumers to purchase expensive HP‑branded ink cartridges by using firmware to block third‑party alternatives. (Reuters)

The plaintiffs had alleged that HP’s “dynamic security” feature—delivered via automatic software updates—deactivated printers when non‑HP cartridges were installed, effectively forcing consumers to use HP ink. The lawsuit claimed this practice inflated ink costs and deprived consumers of competitive alternatives. (Reuters)

Judge Pacold ruled that the plaintiffs failed to plausibly allege that the use of only HP cartridges was a condition precedent to purchasing the printer itself, which weakened their contractual and antitrust claims. She noted that the leverage HP exercised over cartridge purchases stemmed not from any forced “tie” at purchase, but from consumers’ voluntary choice to buy HP printers. (Reuters)

The court did not grant HP a final victory, however—the judge permitted the plaintiffs to amend and refile their complaint in hopes of addressing the deficiencies. (Reuters)

Legal Issues & Reasoning

1. Requirement of a Tying Allegation / Condition of Sale

A central doctrine in antitrust and unfair competition law is the requirement to show that the tying product (the printer) is sold conditioned on purchase of another product (the cartridges). The plaintiffs’ failure to plausibly assert that HP made ink purchase mandatory at the point of printer sale was fatal under the judge’s reasoning.

Because consumers chose HP printers voluntarily, the court found that HP’s control over printer‑ink substitution did not necessarily imply unlawful tying. The ruling underscores how careful plaintiffs must be in drawing the “but for” chain between product sale and downstream purchases.

2. Plausibility & Factual Detail

Judge Pacold emphasized that complaints must go beyond conclusory allegations. Plaintiffs needed factual allegations showing that HP intended or structured sales so that non‑HP ink was effectively prohibited, not merely undesirable. Because many third‑party cartridges reportedly remained usable—or because HP disclosed its cartridge policies—plaintiffs faced an uphill task in showing exclusionary purpose or effect.

3. Firmware & Dynamic Security as Defensible Design

HP had defended the “Dynamic Security” firmware updates as legitimate security and quality control features, not surreptitious lock‑outs. The court’s decision suggests that courts may be more sympathetic to technological rationales in product design, especially when disclosures exist and alternatives persist.

4. Opportunity to Amend

The fact that the court allowed an amended complaint indicates it viewed some of plaintiffs’ defects as curable—meaning HP’s win, at this stage, is not final. If the plaintiffs can strengthen their factual allegations—e.g. internal documents, timing of price increases, consumer behavior evidence—they may survive a renewed motion to dismiss.

Previously Related Litigation: Context & Precedent

• HP has faced similar suits over firmware updates in prior years. In one 2024 case, HP settled a related class action in the Northern District of California, agreeing to allow users of certain printers to decline firmware updates that introduce Dynamic Security, though it paid no monetary relief to consumers. (Ars Technica)
• Earlier domestic and international class actions have alleged that HP’s firmware changes effectively “brick” printers or disable scanning/faxing when ink runs low—a controversial design choice in all‑in‑one printers. (AP News)
• HP’s defenses often rest on disclosure, legitimate quality control grounds, and maintaining control over intellectual property (e.g. chip authentication). The company emphasizes that many third‑party cartridges remain compatible, and that its Dynamic Security measures are publicly documented. (Reuters)

Implications & What’s at Stake

For OEMs & Hardware Manufacturers

This ruling provides a degree of comfort to hardware manufacturers who use firmware or software controls to protect their ecosystems. As long as they can articulate legitimate design justifications, maintain transparency, and preserve some third‑party compatibility, courts may be reluctant to condemn such practices outright.

For Consumer Protection & Antitrust Claimants

The decision raises the bar for consumer plaintiffs: ambitious product‑aftermarket claims must tightly plead causation, economic harm, and tying structure. It also emphasizes that mere control over a secondary market is insufficient without a plausible bridge from primary product sale to downstream restriction.

For Future Rounds in Litigation

Because plaintiffs are allowed to amend, the case may evolve with discovery. Internal HP documents, design communications, pricing strategies, or evidence of forced printer failures may be pivotal. The motion to dismiss stage is only the opening skirmish.

For Policy & Regulation

Beyond litigation, the case may draw regulatory interest. Legislatures and agencies (e.g. FTC) concerned with “device lock-in” or aftermarket monopolies may revisit rules around firmware, forced updates, and consumer rights to repair or modify.

Conclusion: Once the Ink Dries

HP’s recent court victory represents a significant procedural win in the high‑stakes arena of printer aftermarket litigation, but it is far from a definitive judgment on the legality of firmware lockouts or cartridge monopolization. The decision underscores the difficulty of threading product control claims through the strict pleading standards at the motion to dismiss stage: tying must be alleged persuasively, factual specificity is essential, and design defenses carry weight.

That said, the door remains open. If plaintiffs can shore up their complaint with compelling internal evidence or data linking HP’s updates with suppressed competition, a later motion could succeed. Meanwhile, manufacturers who manage closed ecosystems should watch this case carefully: legitimacy and disclosure may be the difference between lawful protection and unlawful exclusion.

HP’s recent court victory represents a significant procedural win in the high‑stakes arena of printer aftermarket litigation, but it is far from a definitive judgment on the legality of firmware lockouts or cartridge monopolization. The decision underscores the difficulty of threading product control claims through the strict pleading standards at the motion to dismiss stage: tying must be alleged persuasively, factual specificity is essential, and design defenses carry weight.

That said, the door remains open. If plaintiffs can shore up their complaint with compelling internal evidence or data linking HP’s updates with suppressed competition, a later motion could succeed. Meanwhile, manufacturers who manage closed ecosystems should watch this case carefully: legitimacy and disclosure may be the difference between lawful protection and unlawful exclusion.