Storage maker Iomega failed to win an injunction against its French rival Nomai, which sells low cost cartridges for Iomega Zip drives.
The US district court for north California said that Iomega had not "met the heavy burden which is required under US law to receive an injunction". Nomai can therefore continue to sell its disks, at least until after the issue goes to trial next April.
Analysts believe Iomega will have to lower its own cartridge prices to avoid losing market share to Nomai, now that it has failed, for now at least, to stop its rival by litigious means from selling in the US.
However, a German court upheld an injunction granted to Iomega against Nomai's distributor Boeder, and fined Boeder for breaking that ruling. Other hearings concerning the Iomega-Nomai dispute will take place in the UK and Australia next year and a French court is examining whether to take further action.
Iomega claims the Nomai XHD cartridge is not fully compatible with the Zip drive and may risk damaging it.
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