Posts Tagged: "exclusion orders"

Since the Supreme Court restricted access to permanent injunctions in eBay v. MercExchange, LLC, more and more patent owners have flocked to the International Trade Commission (ITC) to pursue a Section 337 investigation in hopes of obtaining a coveted and comparable exclusion order. These investigations address unfair practices in import trade—many of which involve allegations of patent infringement—and often lead to exclusion orders preventing infringers from importing their goods into the United States. The ITC’s statutory duty compels prompt completion of these investigations, with matters often proceeding to a full evidentiary hearing less than a year after the complaint is filed. However, with the rapid rise of disputes in the ITC, the agency is under relentless pressure to develop new approaches to facilitate efficient resolution of its investigations.

In withdrawing the 2013 statement, the new 2019 guidance by the DOJ, NIST and the USPTO states the obvious, i.e. that there is no difference in the law between F/RAND assured standard essential patents and all other patents. While some would have perhaps liked to break the unitarity approach of the patent system so as to weaken remedies against the infringement of essential patents, a legal system that would apply a different standard to standard essential patents as opposed to other patents would violate U.S. trade obligations.

In devices such as the iPhone, Apple and Intel merely operate on the technological connectivity platform Qualcomm created. In short, what Intel does well doesn’t compete meaningfully with Qualcomm where American 5G leadership is concerned… Apple’s cavalier conduct toward other people’s intellectual property should run into a red, white and blue brick wall at the American border, courtesy of the ITC, in the form of immediately effective exclusion and cease-and-desist orders, keeping iPhone imports that infringe Qualcomm’s patents out of the United States.

On Monday, August 6th, Santa Clara, CA-based computer networking Arista Networks filed a Form 8-K with the U.S. Securities and Exchange Commission (SEC) announcing the firm had entered into an agreement with San Jose, CA-based networking rival Cisco Systems that dismisses all pending litigation between the two firms in both U.S. district courts and at the U.S. International Trade Commission (ITC). Under the terms of the agreement, Arista will pay Cisco $400 million this month in return for Cisco dropping all patent infringement claims which it has filed against Arista. In addition to Cisco dropping its patent infringement claims, Arista also agreed to drop all antitrust claims which it has filed against its rival.

PopSockets filed its Section 337 complaint with the ITC last April, naming 14 respondents, with 13 based in China and one operating in Hong Kong. This February, the administrative law judge (ALJ) assigned to the case found that not only did the accused products infringe PopSockets’ ‘031 patent, but the infringement was widespread, going beyond the 14 named respondents, such that a general exclusion order was warranted, barring the import of infringing products into the United States by anyone, not just the named respondents.

On Thursday, June 7th, the U.S. International Trade Commission (ITC) announced that it was instituting a Section 337 patent infringement investigation of automobile infotainment systems being imported into the U.S. based on infringement claims asserted by major semiconductor maker Broadcom. Broadcom is alleging that a group of Japanese automakers and tech companies, including Toyota, Panasonic and Denso Ten, over the sale of head units, rear seat entertainment units, units for displaying information or entertainment, as well as cameras and other processing components used in those units and the automobiles containing such units.

The U.S. International Trade Commission has issued a final determination finding a violation of section 337 in a matter dealing with infringement of patents owned by Rovi Corporation. As a result of the investigation the ITC issued a limited exclusion order prohibiting importation of certain digital video receivers and hardware and software components, and also issued cease and desist orders directed to the Comcast respondents. This final determination concludes the matter at the ITC and the investigation is now terminated, with this final determination submitted to President Trump for his review.

Toomey’s comments appear to argue against an exclusion order for TiVo, which at first glance probably is hardly surprising to anyone. Senator Toomey is supporting a large constituent, which is to be expected. However, by doing so in this case Senator Toomey but seems to be directly at odds with a letter he sent just three years ago expressing “strong support of the protections afforded by 19 U.S.C. § 1337 (Section 337)” for a different constituent. Back in 2014, Senator Toomey wrote to the ITC to support a proposed exclusion order because the patent holder in that case “had made considerable financial investments into developing these technologies and without adequate remedies for imported goods that use their patents without paying for them, our de facto policy will be one that encourages this type of activity.” He argued that “[t]his will only deter companies . . . from taking bets on future research and development. That cannot be good for American innovation and job creation.”

A complaint regarding Elekta’s radiotherapy and cancer treatment technologies was filed by Palo Alto, CA-based Varian Medical Systems (NYSE:VAR) in September 2015. The complaint alleged that Elekta violated 19 U.S.C. § 337 which governs penalties for unfair practices in import trade. Varian alleged that Elekta’s medical systems infringe upon a series of six U.S. patents held by Varian.

Reversing the panel en banc, the Federal Circuit found that the ITC does have jurisdiction to issue an exclusion order predicated on induced infringement. Under Chevron step two, the Court deemed that the ITC’s interpretation of Section 337 was reasonable because it was “consistent with the statutory text, policy, and legislative history of Section 337,” as “Section 337 contemplates that infringement may occur after importation.” Further, the panel’s interpretation of Section 337 would unnecessarily “eliminate relief for the unfair trade act and induced infringement” by allowing foreign entities “to circumvent Section 337 by importing articles in a state requiring post-importation combination or modification before direct infringement could be shown.”

If the President disapproves of the ruling for policy reasons he has the authority to nullify the determination. The statute specifically explains that upon disapproval of the President an ITC determination “shall have no force or effect.” The problem that President Obama faces is very real and offers no easy way out. He will no doubt be pushed to used his authority under Section 1337(j) to disapprove of the ITC determination in order to assist Apple and AT&T, both important US companies. The trouble is that Apple is a non-practicing entity and could (and probably should) be properly characterized as a patent troll. So will President Obama use his authority under Section 1337 to help a patent troll?