$1.3 Million in Counterfeit Toner Cartridges Confiscated; Customers Urged to Verify Authenticity of Their Xerox Phaser 780 Printer Toner.

Business Editors

WILSONVILLE, Ore.--(BUSINESS WIRE)--April 12, 2004

Following a global investigation initiated by Xerox Corporation (NYSE: XRX) and involving customs and excise officials from multiple countries, Xerox confirmed today that 7,200 counterfeit color laser printer toner cartridges worth more than $1.3 million have been seized or quarantined by authorities in the past two weeks. The counterfeit toner cartridges were intended for use in Xerox Phaser(R) 780 color laser printers.

The use of counterfeit toner cartridges results in poor equipment performance, low supply yields, inferior print quality, toner leakage, high cartridge failure rates, and increased equipment downtime - all costing customers time and money. Xerox customers who own a Phaser 780 printer are urged to learn how to check the authenticity of their toner by visiting www.xerox.com/office/counterfeitalert. Customers who discover counterfeit toner in their possession should immediately contact the company they purchased their toner from for returns and refunds.

"Hundreds of thousands of illegal products, worth millions of dollars, are removed from commerce each year," said Bill Duffy, president and chief executive officer of the Imaging Supplies Coalition, a nonprofit trade association. "This is a problem that faces the entire printing industry, and is something all manufacturers must remain vigilant in fighting to help prevent damage to the ultimate victim - the customer."

The recent counterfeit toner confiscations occurred at shipping ports in Hong Kong and other international locations, and multiple locations in the United States. About 4,800 cartridges were seized in the international locations, and 2,400 cartridges have been quarantined in the U.S. An additional incident is currently pending and is expected to yield an additional 2,000 cartridges, bringing the expected total to 9,200 cartridges worth more than $1.6 million.

The imaging industry sees millions of dollars in counterfeit or stolen supplies sold each year worldwide. Xerox is leading the charge against counterfeiting and other black-market activities and has a team of professionals who investigate and identify the individuals and companies that participate in these illegal activities.

"Xerox takes an aggressive stance against counterfeiters and is dedicated to ensuring and protecting customer value through ongoing efforts to identify, investigate, and prosecute counterfeit operations," said George Parry, Xerox Corporate Security investigator. "These latest seizures and quarantines underscore the efforts we take, on a worldwide basis, to protect our customers from counterfeiters."

Customer Contact:

Xerox customers can find more information at www.xerox.com/office/counterfeitalert.

Media Contacts:

Rob Houston, Xerox Corporation, 503-685-3226, [e-mail]

Erin Isselmann, Xerox Corporation, 503-685-4493, [e-mail]

NOTE TO EDITORS: For more information on Xerox, visit www.xerox.com/news. XEROX(R), The Document Company(R), Phaser(R), and the digital X(R) are trademarks of XEROX CORPORATION.