HP 2011 Annual Report Download - page 151

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 18: Litigation and Contingencies (Continued)
restitution, attorneys’ fees and costs, and certification of a nationwide class. On February 27, 2009, the
court denied with prejudice plaintiffs’ motion for nationwide class certification for a third time. On
August 31, 2011, the California Court of Appeal reversed the trial court’s denial of class certification
and remanded the case back to the trial court for further proceedings. On November 23, 2011,
plaintiffs filed a motion seeking to certify a nationwide class asserting claims under the California
Consumers Legal Remedies Act and the California Unfair Competition Law. A hearing on plaintiffs’
motion is currently scheduled for March 2, 2012.
Inkjet Printer Litigation. As described below, HP is involved in several lawsuits claiming breach of
express and implied warranty, unjust enrichment, deceptive advertising and unfair business practices
where the plaintiffs have alleged, among other things, that HP employed a ‘‘smart chip’’ in certain
inkjet printing products in order to register ink depletion prematurely and to render the cartridge
unusable through a built-in expiration date that is hidden, not documented in marketing materials to
consumers, or both. The plaintiffs have also contended that consumers received false ink depletion
warnings and that the smart chip limits the ability of consumers to use the cartridge to its full capacity
or to choose competitive products.
• A consolidated lawsuit captioned In re HP Inkjet Printer Litigation is pending in the United
States District Court for the Northern District of California where the plaintiffs are seeking class
certification, restitution, damages (including enhanced damages), injunctive relief, interest, costs,
and attorneys’ fees. On January 4, 2008, the court heard plaintiffs’ motions for class certification
and to add a class representative and HP’s motion for summary judgment. On July 25, 2008, the
court denied all three motions. On March 30, 2009, the plaintiffs filed a renewed motion for
class certification. A hearing on the plaintiffs’ motion for class certification scheduled for
April 9, 2010 was postponed.
• A lawsuit captioned Blennis v. HP was filed on January 17, 2007 in the United States District
Court for the Northern District of California where the plaintiffs are seeking class certification,
restitution, damages (including enhanced damages), injunctive relief, interest, costs, and
attorneys’ fees. A class certification hearing was scheduled for May 21, 2010 but was taken off
the calendar.
• A lawsuit captioned Rich v. HP was filed against HP on May 22, 2006 in the United States
District Court for the Northern District of California. The suit alleges that HP designed its color
inkjet printers to unnecessarily use color ink in addition to black ink when printing black and
white images and text. The plaintiffs are seeking to certify a nationwide injunctive class and a
California-only damages class. A class certification hearing was scheduled for May 7, 2010 but
was taken off the calendar.
• Two class actions against HP and its subsidiary, Hewlett-Packard (Canada) Co., are pending in
Canada, one commenced in British Columbia in February 2006 and one commenced in Ontario
in June 2006, where the plaintiffs are seeking class certification, restitution, declaratory relief,
injunctive relief and unspecified statutory, compensatory and punitive damages.
On August 25, 2010, HP and the plaintiffs in In re HP Inkjet Printer Litigation, Blennis v. HP and
Rich v. HP entered into an agreement to settle those lawsuits on behalf of the proposed classes, which
agreement is subject to approval of the court before it becomes final. Under the terms of the proposed
settlement, the lawsuits will be consolidated, and eligible class members will each have the right to
143