Posts Tagged: "ITC"

In late June, medical technology firm Masimo Corporation and its consumer device subsidiary Cercacor Laboratories filed a complaint with the U.S. International Trade Commission (ITC) asking the agency to institute a Section 337 investigation into several versions of the Apple Watch. Masimo’s allegations, which also include trade secret litigation ongoing in U.S. district court, follow an increasingly familiar narrative in which a Big Tech player, in this case Apple, engages in licensing negotiations with a small tech developer, only to poach employees and ideas from the smaller firm without paying the original developers.

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 September, the International Trade Commission (ITC) decided to review an initial final determination (FID) in the Matter of “Certain Botulinum Toxin Products, Processes for Manufacturing or Relating to Same and Certain Products Containing Same,” Investigation No. 337-TA-1145, a complaint filed by Allergan against Botox products made by Daewoong and its partner, Evolus, a “performance beauty company”. On Wednesday, the ITC issued a Final Determination in the case, finding that the sale and importation of the products into the United States violated Section 337 of the U.S. Tariff Act. The Commission issued a Limited Exclusion Order (LEO) prohibiting importation of the products by Daewoong and Evolus for a period of 21 months, as well as a cease and desist order against Evolus preventing the Company from selling, marketing, or promoting the products in the United States for a period of 21 months. However, the Commission reversed the FID’s finding that a trade secret exists with respect to Medytox’s bacterial strain.

Last week, the United States International Trade Commission (ITC) issued a notice in the Matter of “Certain Botulinum Toxin Products, Processes for Manufacturing or Relating to Same and Certain Products Containing Same,” Investigation No. 337-TA-1145, stating that the ITC has “determined to review in part a final initial determination (FID) of the presiding administrative law judge (ALJ) finding a violation of section 337 of the Tariff Act of 1930.”Last year, Allergan, the U.S. manufacturer of Botox, and Medytox, the Korean manufacturer of a similar product, filed a joint complaint against Daewoong, a Korean drug maker, under Section 337 of the Tariff Act of 1930, alleging that Daewoong had stolen Medytox’s botox strain trade secret in Korea and introduced it to the U.S. market. The FID was issued on July 6, 2020, wherein the ALJ found that certain products sold by the Korean drug maker Daewoong and its partner Evolus, Inc. violated section 337 through their importation and sale in the United States of a botulinum neurotoxin product “by reason of the misappropriation of trade secrets.”

In late July, water bottle maker Hydro Flask and parent company Helen of Troy Limited filed a complaint with the U.S. International Trade Commission (ITC) asking the agency to institute a Section 337 investigation against a series of 25 respondents, most of which are located in China, over their alleged infringement of Hydro Flask’s trademarks and design patents. The legal action highlights the difficulties being faced by many American brand owners during the COVID-19 pandemic and how Congressional action could help to ensure that these small businesses are able to effectively enforce their IP to prevent counterfeit imports.

Last week, the U.S. Court of Appeals for the Federal Circuit affirmed a decision of the U.S. International Trade Commission in Mayborn Group, Ltd. v. ITC, wherein the U.S. International Trade Commission (the Commission) denied Mayborn’s petition for rescission of a general exclusion order that prohibited the importation of products that infringe U.S. Patent 8,028,850 (the ’850 patent).  The CAFC held that, while Mayborn had standing to appeal, the Commission lacked the authority to adjudicate its patent invalidity claim and an assertion of patent invalidity was insufficient grounds to support a petition to rescind or modify an exclusion order.

District court patent filings are up again this week, demonstrating that even a good lockdown can’t keep patent lawyers down; indeed, it appears there’s no sleep for the weary, given the spike in non-practicing entity (NPE) assertions and a fair amount of medium-sized company-to-company litigation, as well as a brewing dispute between Philips and Fitbit on wireless fitness trackers.

As IPWatchdog reported last week, on March 2, in what can only be characterized as the most significant crackdown against patent evasion in a generation, TiVo Corporation won a groundbreaking U.S. Court of Appeals for the Federal Circuit ruling against Comcast. The Court’s opinion provides a noteworthy precedent that will spell trouble for the future of Comcast’s business practices, particularly for the company’s upcoming cases with the ITC. More significantly, however, it will protect the authority of the ITC to police similarly profiled instances of patent trolling in the future, which will make the opinion go down in history as one of the most substantial victories for the strength and sanctity of patent evasion in the 21st century

The U.S. Court of Appeals for the Federal Circuit has upheld an International Trade Commission (ITC) ruling granting a limited exclusion order that bars importation of X1 set-top boxes by Comcast, including importation by ARRIS and Technicolor on behalf of Comcast. Although the patents at issue have both expired, the Court refused Comcast’s motion to dismiss, finding that there were “sufficient collateral consequences to negate mootness.”

At a time when most policymakers rightly argue that China and other countries need to do more to clamp down on intellectual property infringement, overturning the four-factor eBay test would impose new hurdles and increase the PAE problem that Congress and the Supreme Court have fought to address over that last two decades. The risk that an implementer engages in “efficient infringement” has made the ITC an increasingly attractive forum, for at least some patent owners and notably not PAEs. ITC exclusion orders and cease and desist orders are the last vestige of the exclusivity promised to the right patent owners at the time they are granted a patent. Compared to proposed sections of the STRONGER Patents Act, the ITC strikes a balance between offering at least some patent owners the ability to prevent infringers from engaging in the never-ending game of “efficient infringement” while frustrating PAEs attempts to abuse the exclusionary remedies offered.  Congressional action should be reserved for a time when there is clear evidence that the eBay decision is harming U.S. businesses and those U.S. businesses are unable to obtain the relief they need at the ITC. At this time, there is no such evidence.

Last month, we released our first ITC Intelligence Report. For the first time, we ranked ITC law firms and attorneys based on their performance and activity. Our research team analyzed the outcome of 308 ITC Section 337 Investigations, filed from January 1, 2014, through December 1, 2019. For all the terminated cases, we identified the outcome (e.g., violation, no violation, settlement, etc.). Then, depending on the outcome and win/loss of parties (i.e., complainants and respondents), we allocated points to each side, including the law firms and attorneys representing them.

On Thursday, December 12, the U.S. Court of Appeals for the Federal Circuit issued a decision in Techtronic Industries Co. Ltd. v. International Trade Commission in which the appellate court reversed a final determination from the International Trade Commission (ITC) that garage door opener products sold by Techtronic violated a patent owned by The Chamberlain Group. The Federal Circuit found that the ITC erred in its construction of a claim term during its Section 337 investigation of Techtronic. This appeal stems back to a final determination issued by the ITC in March 2018  where the agency found that Techtronic infringed upon multiple claims of U.S. Patent No. 7,161,319, Movable Barrier Operator Having Serial Data Communication. It covers an improved garage door opener having a motor drive unit and a wall console for closing and opening a door. Both the motor drive unit and the wall console have microcontrollers that are connected via a digital data bus. The invention makes use of passive infrared detectors to detect heat from humans in the vicinity to determine when to illuminate the wall console for better sight of the garage door switches.

Patent investigations at the International Trade Commission (ITC) have been on an upward trend in the last few years. In 2018, the most recent year with complete data, 74 new complaints were filed and there were 130 active investigations, compared to the 117 active investigations in 2017. The trend appears to be continuing in 2019. In today’s global economy, with so many types of products and components being imported into the United States, a rise in patent investigations means that a large number of U.S. companies and their customers are at risk of having their supply chain disrupted. This can result in a potential loss of income, breached contracts, disgruntled customers and general uncertainty regarding the future.

Case filings at the U.S. International Trade Commission (ITC), a popular venue for resolving intellectual property disputes, reached record levels in 2018, and 2019 appears likely to be another busy year. In fact, there have already been a number of important decisions, including one in Qualcomm’s high-profile battle with Apple relating to the public interest, one making it clear that the ITC has jurisdiction over those only indirectly involved in infringement, and an opinion addressing the overlap between the ITC and the Food and Drug Administration (FDA) as well as  the ITC’s ability to police misleading advertising and labeling of pharmaceuticals, cosmetics, and dietary supplements.

This week in Other Barks & Bites: the Chinese and U.S. governments hash out intellectual property issues; a prominent New York City politician joins the effort to break the patent on Gilead’s Truvada; Qualcomm tells the ITC that Apple’s design around undermines the agency’s finding that an exclusion order shouldn’t be entered against infringing iPhones; the Fortnite copyright cases take a new turn; Babybel loses the trademark on its red wax cheese coating in the UK; Fisker & Paykel and ResMed settle their worldwide patent dispute; Facebook could face major FTC fines for payments from children playing video games on the platform; and reports indicate that Pinterest is pursuing an initial public offering.