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Cypress Semiconductor Vows to Fight Despite ITC Loss

Written by Gene Quinn
Patent Attorney & Founder of IPWatchdog, Inc.
Principal Lecturer, PLI Patent Bar Review Course
Posted: June 12, 2013 @ 10:36 am

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Cypress Semiconductor Corp. (NASDAQ: CY) announced earlier this week that it will continue to aggressively enforce its patents despite an unfavorable final determination from the International Trade Commission that GSI Technology, Inc. does not infringe any of the four patents asserted by Cypress.

“The ITC’s confirmation of the earlier ruling changes nothing,” said Dana Nazarian, Executive Vice President of the Memory Products Division at Cypress. “We remain steadfast in our conviction that GSI has violated our patents, and look forward to moving this fight to the district court where we can argue our case to a jury.”

Given the disjointed nature of patent enforcement a loss in one forum does not preclude a party, such as Cypress, to continue to fight in another forum.

Originally the ITC instituted this investigation on July 28, 2011, based on a complaint filed by Cypress Semiconductor Corporation of San Jose, California. The complaint filed by Cypress alleged violations of section 337 of the Tariff Act of 1930 (19 U.S.C. § 1337) relating to the importation into the United States, the sale for importation, and the sale with in the United States after importation of certain static random access memories and products containing the same by reason of infringement of various claims of United States Patent Nos. 6,534,805; 6,651,134; 6,262,937 and 7,142,477. The notice of investigation named GSI of Sunnyvale, California, among others.

On October 25, 2012, the ALJ issued his final investigative determination finding no violation of section 337 by the Respondents. While the ALJ also found that the importation requirement of section 337 (19 U.S.C.§ 1337(a)(1)(B)) had been satisfied, it was determined that the accused products did not infringe the asserted patent claims. The ALJ also found that Cypress failed to establish the existence of a domestic industry that practices the asserted patents under 19 U.S.C. § 1337(a)(2) for failure to establish the technical prong of the domestic industry requirement. No determination was made initially as to the validity or enforceability of the asserted patents. On remand from the Commission the ALJ did ultimately determine that the patents were enforceable and the claims not invalid.

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Domestic Injury Requirement

What is the domestic injury requirement? One of the requirements of finding a violation of Section 337 is that the Complainant must establish that an industry in the United States exists relating to the articles protected by the the patent. See 19 U.S.C. § 1337(a)(2). More specifically, the domestic industry requirement is broken up into two prongs: one technical, and one economic.  The technical prong concerns whether the complainant practices at least one claim of the asserted patents, while the economic prong concerns domestic activities with respect to the patent or patented article.

Losing on the technical prong of the domestic injury requirement means that the ALJ did not find evidence to suggest that Cypress practiced at lase one claim of the asserted patents within the United States. Thus, Cypress was essentially seeking to use a patent that it did not practice to prevent entry of allegedly infringing products into the United States. Despite what you may have heard in the news to the contrary, the ITC is not a venue for non-practicing entities to seek redress.

Final Determination by Commission

Ultimately, upon review of the record of the investigation, including the ALJ’s two decisions and the various filings of the parties the Commission affirmed the ALJ’s finding of no violation of section 337, but did modify the decision. Specifically, with respect to the ’805 patent, the Commission affirmed the following findings:

  1. Cypress failed to prove that the accused products infringe the asserted claims;
  2. Cypress failed to establish the technical prong of the domestic industry requirement; and
  3. Respondents failed to establish by clear and convincing evidence that U.S. Patent No. 6,677,649 to Osada et al. or U.S. Patent No. 6,445,041 to Ishida et al. anticipate the asserted claims.

Regarding the ’134, ’937, and ’477 patents, the Commission affirms the following findings:

  1. Cypress failed to prove that the accused products infringe the asserted claims;
  2. Cypress failed to establish the technical prong of the domestic industry requirement; and
  3. Respondents failed to establish by clear and convincing evidence that the cited prior art references anticipate the asserted claims.

Cypress intends to vigorously pursue its two pending district court lawsuits against GSI, which include three of the patents asserted in the ITC investigation and seven additional patents. Those cases are No. 11-cv-00789, filed March 30, 2011, before Judge Patrick J. Schiltz in the United States District Court for the District of Minnesota, and No. 13-cv-02013, filed May 1, 2013, before Judge Jon. S. Tigar in the United States District Court for the Northern District of California. Cypress has asserted that GSI’s SigmaQuad-II™, SigmaQuad-III™, SigmaDDR™, standard Synchronous, and NBT SRAMs infringe multiple Cypress patents.

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About the Author

is a Patent Attorney and the founder of the popular blog, which has for three of the last four years (i.e., 2010, 2012 and 2103) been recognized as the top intellectual property blog by the American Bar Association. He is also a principal lecturer in the PLI Patent Bar Review Course. As an electrical engineer with a computer engineering focus his specialty is electronic and computer devices, Internet applications, software and business methods.


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