Around 2,000 customers will be compensated AU$50 by HP Australia after the company installed technology on its printers to prevent non-HP ink cartridges from being used without telling consumers.
The Australian Competition and Consumer Commission (ACCC) has told HP PPS Australia to compensate customers who purchased its printers without being told they contained technology that did not allow for non-HP ink cartridges to be used in them.
The court-enforceable undertaking, given to the wholly owned subsidiary of HP, outlines how an "undisclosed technology" known as Dynamic Security Feature (DSF) was deployed to prevent anything other than HP-branded ink cartridges from being used in around 220,000 printers in Australia.
DSF was either installed prior to purchase or installed thereafter through firmware updates downloaded by users, with many customers receiving error messages in September 2016 that non-HP ink cartridges were damaged and could not be installed -- or simply having their non-HP cartridges rejected by the printer.
HP has admitted to likely breaching Australian Consumer Law by engaging in false, misleading, or deceptive conduct by not disclosing that the printers used DSF technology preventing other brands of ink cartridges from being used.
"Consumers were not made aware of the restriction on using non-HP ink cartridges when buying the printer or downloading the firmware update, and were denied the choice to accept or reject it," ACCC Deputy Chair Dr Michael Schaper said on Tuesday.
"The ACCC was also very concerned that HP used technology to change these printers' functionality after purchase, without alerting consumers to the restriction on the use of non-HP ink cartridges, which was being installed."
According to the ACCC, around 2,000 customers were affected, with each to be compensated AU$50 by HP -- totalling an approximate AU$100,000 compensation bill.
The company is also required to "make clear on its packaging and at the point of sale" if DSF technology has been used on a printer and what its effects are, and it has since made an automatic firmware update available to remove DSF tech from some of its printers.
The 10 HP inkjet printer models affected by DSF tech during that time were the HP OfficeJet Pro 6230, HP OfficeJet 6820, HP OfficeJet Pro 6830, HP OfficeJet Pro 8610, HP OfficeJet Pro 8620, HP OfficeJet Pro 8630, HP OfficeJet Pro X551dw, HP OfficeJet Pro X476dw MFP, HP OfficeJet Pro X576dw MFP, and HP OfficeJet Pro X451dw.
HP Australia also found itself in the ACCC's crosshairs back in 2012, when the consumer watchdog launched proceedings in the Australian Federal Court alleging false or misleading representations to consumers on warranties and replacements.
The company admitted to breaching Australian Consumer Law in 2013 during those court proceedings, but argued that there was "no evidence to establish the extent of the damage done to consumers and on how many people were affected by it".
However, it ended up paying AU$3 million in civil pecuniary penalties as a result.
HP Australia was also forced to change its claims and complaints processing and handling procedures back in 2009 after the ACCC received multiple complaints about cash-back and gift promotions.
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