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Request to take action against HP Israel: Company forces customers to buy only original and expensive inks made by it | Israel Hayom


Highlights: Many consumers who own an old HP printer have found that a software update forces them to purchase only the company's original, more expensive inkjet cartridges. Just a year ago, HP was obligated to pay compensation of NIS 6 million to its customers in Israel as part of a settlement in a class action lawsuit. Now the Council has asked the Competition Authority to take action against the company. HP responded: "The move is intended to preserve the quality of the print and prevent a hostile takeover of the printer"

Many consumers who own an old HP printer have found that a software update forces them to purchase only the company's original, more expensive inkjet cartridges • Just a year ago, HP was obligated to pay compensation of NIS 6 million to its customers in Israel as part of a settlement in a class action lawsuit on this exact issue • Now the Council has asked the Competition Authority to take action against the company • HP responded: "The move is intended to preserve the quality of the print and prevent a hostile takeover of the printer" • Cyber expert: "The takeover risk is rare, you have to let the customer choose"

Following Israel Hayom's request: The Israeli Consumer Council decided to ask the Competition Authority to take steps and change legislation against HP Israel. This comes after a software update of the manufacturer's printers seeks to force, once again, users in Israel – including owners of older printers – to purchase only genuine HP inkjet cartridges at a cost that is usually significantly more expensive than replacement ones, despite the fact that HP Israel was obligated last year to compensate its consumers in Israel as part of a class action lawsuit against it on this very issue. HP Israel claims that the goal of the move is to preserve print quality for the customer and prevent remote control of the printer through non-genuine chips in the inkheads, which according to security experts is theoretically possible - but difficult to do and rare.

HP's attempts to force users of the brand's printers to purchase only genuine inkjet cartridges began in 2016. That year, HP remotely activated a firmware update for its printers called Security Dynamic. The update effectively immediately disables printers for users who have purchased replacement ink, which is sometimes 50% cheaper than the cost of Original HP ink cartridges. This update makes it impossible to use the printer unless the dedicated chips found in HP ink cartridges alone are detected.

HP printer, photo: Ori Rodriguez Garcia

The move in 2016 has led to quite a few class actions in recent years around the world, as well as in Israel, and in most of them the company was required to pay compensation to its customers, either through a compromise or as part of a court ruling. In 2018, the company reached a settlement in the U.S. after a lawsuit in which it paid $1.5 million in damages to its users. In 2019, the Supreme Court in Quebec Canada approved a settlement under which the company's customers would be compensated C$700,000 to users affected by the move, and in 2020 HP announced that it would pay A$50 to each user affected by its move. In 2022, it was agreed that HP would compensate its European consumers affected by the move in the amount of approximately €1,350,000.

A class action lawsuit was also filed in Israel on the matter, which ended in a compromise agreement in which HP undertook to take measures to inform the consumer public that the packaging of printers, which include a dynamic security system manufactured as of January 31, 2022 and imported to Israel, will include a Hebrew marking on the front of the packaging regarding the existence of a dynamic security system that blocks the use of such cartridges. It was also agreed that HP would pay group members compensation totaling NIS 6 million, which would be transferred to a designated trust account from which compensation would be paid to group members.

However, it should be noted that the proceeding against the company in Israel establishes a duty to disclose and compensate only, similar to the results of similar proceedings around the world against HP, except for Australia, where the company undertook in the settlement agreement to release a software update that erases the dynamic protection and a commitment not to repeat its actions - in addition to compensation to the consumer public.

But all this, as mentioned, did not discourage HP from trying to force its customers again to purchase only its original and expensive ink cartridges. In recent months, a large number of owners of old HP printers in Israel have received a firmware update for printers of various models on which the Security Dynamics update has not yet been applied, which effectively blocked printers with replacement inkjets altogether.

HP printer block message, photo: Ori Rodriguez-Garcia

When contacted by HP, applicants were told that the move was in their best interest due to considerations of print quality and hostile takeover. Attempts to downgrade the firmware to an earlier version from the HP website without the security update were unsuccessful.

It should be noted that the printer can be programmed not to receive updates, but this is a step that HP itself does not recommend, and in case the notification status is turned off, the printer itself will send reminders to turn on the wireless update. Be that as it may, cases that have reached the system indicate that the blocking update cannot be rolled back once it has been updated.

The Consumer Council was surprised by HP's move, which took this step less than a year after it was obligated to pay compensation to its consumers in Israel as part of a settlement in a class action lawsuit, on this very issue. The Council decided to appeal to the Competition Authority to take action against HP in Israel.

In a letter sent to the Israel Competition Authority, Adv. Ofer Feinstein, CEO of the Israel Consumer Council, wrote: "In the Council's view, HP's actions constitute anti-competitive activity in that it requires printer owners to purchase only the replacement ink from HP. With technological developments in recent years and changes in employment and consumption habits, more and more households own printers. That is, we are dealing here with routine expenditure of households in Israel.

"HP's moves lead to the elimination of competition in this area, strengthening HP's status as a kind of monopoly on its printer holders, and fixing prices (if not saying) in printer ink. Therefore, I wish to address you in this letter, demanding that you act to regulate the issue by advancing relevant legislation or taking administrative proceedings."

HP 6970 printer, one of the older models to which the software update applies, photo: Ori Rodriguez-Garcia

The Israeli Consumer Council told Israel Hayom: "The Competition Authority has the authority to impose financial sanctions or use other administrative tools at its disposal to dissuade the company from ceasing this conduct. Of course, only after the matter has been examined and the Competition Authority finds that this is a move that harms competition. To the extent that the Competition Authority does not find that there is a violation of the Competition Law in a way that will enable it to use the administrative tools at its disposal, it can propose and promote legislative amendments to deal with the problem, all of course if they see the processes conducted by HP as problematic – as we see them."

Security experts who were asked for HP's explanation of remotely taking control of a printer with non-genuine printheads told Israel Hayom that this is theoretically possible, but rare and difficult to do.

Doron Sivan, CEO of MADSEC Security and an expert in defending against hacker attacks: "Theoretically, such an attack is possible. It is possible with great effort and deliberate effort to create a chip that will cause the printer while reading the encoding to read malicious encoding. However, in principle it is possible to let the client choose at his discretion. If HP officially says it may be a vulnerability and it defends it, that's a substantive argument. But at the same time that this need is understood, it is impossible to ignore the fact that it serves its (commercial) interests. So on the one hand, HP's statement cannot be ruled out, especially in the current situation of attacks on IoT equipment, and on the other hand, of course, it serves them from a business aspect."

HP responded: "Like many companies, HP regularly implements firmware updates to keep functionality up to date and improve the printing experience for our customers. Some HP printers have a Dynamic Security feature that may block cartridges that do not have HP chips or circuits. The company does this because third-party cartridges equipped with non-HP chips or electronic circuits can pose risks to hardware performance, print quality, and security.

"Studies have shown, as part of HP's Bug Bounty program, that malware can reprogram a non-HP ink cartridge with a non-HP chip and exploit vulnerabilities discovered in the electronic data interface, thereby gaining access and control over the printer. HP's firmware role is to protect against such illegal activity.

"This does not mean that consumers cannot use renewed, refilled or reused cartridges. You can reuse an HP chip or circuit board that is not affected by Dynamic Security technology. Printers with a Dynamic Security feature are marked as such on our product packaging, technical components and various online materials, all in accordance with local laws. When it comes to firmware updates, in most cases, consumers can choose how they receive firmware updates through their printer settings."

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Source: israelhayom

All tech articles on 2023-05-30

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