GENEVA, September 20, 2004 - In a move to boost protection for its legitimate partner community, customers and its brand, HP today announced that it would track and tackle companies conducting grey marketing and related illegal activities throughout Europe. Over the last six months, HP worldwide has augmented its activities to eliminate violations of HP's trademark rights and the abuse of its special pricing programs.
Progressive HP actions now underway include:
- Legal recourse and de-authorisation of resellers. In Europe, HP has taken several resellers to court and will continue to pursue legal action whenever possible. Likewise, HP will not hesitate to de-authorise partners who conduct illegal activities.
- Rigorous enforcement and management of special pricing programs. By tightening controls and improving internal processes, HP has been able to actively reduce the flow of products outside the authorised channel.
- Internal awareness campaign within HP. An extensive employee training program focused on how to spot fraud and misuse of HP's brand.
- Ongoing dialogue with partners. Thanks to strong relationships with its partners about grey marketing issues, HP receives a steady flow of information and feedback.
"We will not hesitate to take appropriate legal action, where our legitimate partners, customers and brand are at risk," said Jos Brenkel, vice president, HP Solution Partners Organization, Europe, Middle East and Africa. "We owe it to our partners to help protect their position in this competitive marketplace, while we owe it to our customers to ensure that the HP products they buy meet HP's high standards for quality and reliability. We will not allow the HP brand to be compromised."
In Europe alone, HP has filed three legal cases to protect itself, partners and unsuspecting customers from these activities over the last year. HP has also de-authorised or de-listed numerous distributors and resellers around the world who have violated HP's contract terms or trademark rights.
Recent legal cases include the suit against Paradise Computer Corporation, alleging trademark infringement as a result of certain products being placed on the UK market without HP's consent. HP sought damages and an agreement from Paradise Computer Corporation to immediately cease and desist future such activities. In Austria, HP has filed a case seeking recovery of over $6 million in discounts from a former distributor who, as the suit alleges, claimed products would be sold to a particular end customer, but instead sold them to an unauthorised UK broker, Beatmark. The case is still pending with the courts.
Earlier in the year, a UK court found in favor of HP in its breach of contract case against FNS. With the win, HP was awarded a judgment of $2.3 million.
In the latest case filed in the United States, HP is seeking damages of over $8.6 million from Capital City Micro and P & E Distributing for fraud, breach of contract and misrepresentation. The suit alleges that HP granted the discounts for a specified end customer, but instead of selling the products to that end customer, Capital City Micro sold the products on the grey market against its contract terms and conditions.
In cases where fraudulent manipulation of HP's special pricing programs is identified then HP will not hesitate, where appropriate, to expose that behavior through the courts and seek maximum compensation.
"We want customers and dealers alike to recognise that when products are offered through non-authorised channels at greatly reduced prices, then there is a significant chance that those products have been illegally imported into the European Union or have been obtained through fraudulent misuse of special pricing for specific end-user customer deals: They need to be on their guard," added Brenkel. "We are advising distributors and resellers to track product serial numbers on all sales and delivery documentation to make it easier to investigate abuses."
HP's main priorities in this global campaign to combat grey marketing are to provide a level playing field for its authorised partners, protect customers and ensure the integrity of the HP brand and its trademarks. Ongoing efforts in this campaign also include a buy, track and trace investigative program, end-user verification checks and distributor audits.
HP is a founding member of AGMA, the Alliance for Gray Market and Counterfeit Abatement, formed in September 2001. HP - along with other technology companies - is educating the marketplace about illegally diverted product and the illegal flow of products into the grey market.
About HP
HP is a technology solutions provider to consumers, businesses and institutions globally. The company's offerings span IT infrastructure, personal computing and access devices, global services and imaging and printing. For the four fiscal quarters ended July 31, 2004, HP revenue totaled $78.4 billion. More information about HP (NYSE, Nasdaq: HPQ) is available at www.hp.com.
Contactpersonen voor
de redactie:
HP, Jos Baltes
030 222 33 44
jos.baltes@hp.com
of
H&K/MCS
René Reijers
023 562 82 08
reneer@monogram.nl
Hewlett-Packard Nederland
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www.hp.nl