Whirlpool Corp. has filed 40 lawsuits to protect one replacement part: a $50 refrigerator water filter.
Using a Texas court known as the venue of choice for people trying to win patent cases, the company has taken the unusual step of suing retailers that sell knock-off filters direct to consumers and, according to a lawyer for two of the companies, even its own distributors.
“In addition to infringing our intellectual property, these water filters risk harming consumers by failing to meet our high standards,” said Kristine Sherman, a Whirlpool spokeswoman. The copycat products are “substandard in a variety of ways,” she said, noting Whirlpool filters are certified by safety group NSF International for up to 66 types of contaminants, including parasites, metals, pesticides and pharmaceuticals.
The reason shoppers like the off-brand filters is clear: distributors sell them for half the price of Whirlpool’s. So when the company noticed "a sudden emergence" of the non-Whirlpool filters in 2015, its lawyers swung into action.
The appliance maker, based in Benton Harbor, Michigan, has been filing patent-infringement lawsuits in Texas since September, claiming companies are selling unauthorized replacement parts for its refrigerators — including the water filter cartridges.
By suing retailers, the company is borrowing a tactic from computer printer makers that try to block the sale of unauthorized toner cartridges, and from automakers that sometimes try to fend off sale of refurbished replacement parts.
Most of the defendants in the Texas suits are retailers who sell plumbing supplies and appliances from places like Tennessee, Indiana, Washington, South Dakota and Georgia. They also have online sites where people from Texas can buy their products, giving Whirlpool the standing to sue there.
Some retailers were distributing both authorized Whirlpool filters and the cheaper versions, said patent lawyer Michael Smith of Siebman Burg in Marshall, Texas, who represented two companies that settled within weeks of being sued.
“I haven’t seen companies like Whirlpool filing cases against distributors,” Smith said. “These are Whirlpool distributors, so Whirlpool would have a little more leverage against them. It is an unusual batch of cases, but I can understand why they are doing it.”
At least two of the companies are manufacturers, including a Chinese company doing business as Yunda Filter Co. that has agreed to stop selling its products including on Alibaba.com, although the suit continues.
It’s unclear how much Whirlpool earns from the filters. It recommends that the filters be replaced every six months, which can add up for consumers over the lifetime of the appliance.
Sales of refrigerators and freezers accounted for 28 percent of the company’s $20.9 billion in sales last year, according to Whirlpool’s annual report. Of the 10.3 million refrigerators shipped by all manufacturers for sale in the U.S. last year, 50 percent had water filtration systems, according to the Association of Home Appliance Manufacturers, a Washington-based trade group.
More than 40 percent of all patent-infringement suits were filed in the Eastern District of Texas last year. Tech companies have been pushing Congress to change the rules on where patent suits can be filed, saying the Texas court is home to too many patent owners that don’t make products and use litigation as an cudgel to force companies to pay unearned licensing fees.
Whirlpool’s Sherman said the cases were filed there because the east Texas district is “very experienced in patent law and has a history of resolving infringement cases in an efficient and prompt manner.”
Whirlpool’s goal isn’t money. In at least 15 of the cases, settlements came within weeks with promises not to sell the unauthorized filters again. Officials with a half-dozen distributors that have settled declined to comment publicly, citing the agreements.
Not all of the companies are giving in so quickly. At least 15 lawsuits have been consolidated for pre-trial purposes before the judge, with mediation due by February and a trial in August 2017. The first-filed lawsuit against manufacturer TST Water LLC, which wasn’t joined with the others, is scheduled for trial in March.
Most of the cases focus on a single patent issued in February 2006 to Pur Water Purification Products, now a unit of Helen of Troy Ltd., and transferred to Whirlpool in 2007. It’s for “fluidic cartridges” with end pieces that cause the valves inside the appliance to work.
The companies that have filed responses to the suits say the patent, and others that were asserted in some of the cases, are invalid or weren’t infringed.
TST Water, which sells its filters under the name WaterSentinel, admits making filters that can be used in Whirlpool refrigerators but said there’s no harm to Whirlpool.
Whirlpool got paid for its patent when the consumer bought the refrigerator with the original filter, and the replacement parts fall under the legal theory of “permissible repair,” meaning someone has the right to keep their purchased product working, TST said in its response to the suit.
Time goes by
It also says Whirlpool waited too long to complain; the patent was issued in 2006.
TST’s lawyer, John Sganga of Knobbe Martens in Irvine, California, said his clients don’t want to talk about the case while it’s pending. Yunda Filter’s lawyer, Lei Mei of Mei & Mark in Washington, said the same about his client.
The judge handling all the cases has already issued an order defining key terms in the filter cartridge patent for the TST case. He had help from a technical adviser, and TST and Whirlpool had to each pay $9,473 to pay for that help.
In terms of refrigerator filters, Whirlpool had to pay the equivalent of 189 filters, while TST’s costs were equal to about twice as many of the lower-cost products.