Docket Update: Retaliation, Early Disposition, and Constituent Support

Investigation Retaliation

Occasionally, for reasons of strategy or necessity, someone will file a complaint at the International Trade Commission without pursuing any other remedies.  But most Section 337 investigations at the ITC are based on patent infringement that the complainant is also alleging in a lawsuit in federal court.  Sometimes, though, a complainant will file a case at the ITC in order to retaliate against an existing lawsuit or ITC investigation brought by the respondent.

The ITC is already a juggling few of these cross-complaints on its docket right now, including beer dispensers (Inv. 1115 & 1130), data storage tapes (Inv. 1012, 1036, 1058, 1076), and industrial automation products (Inv. 1074 & 1105).  We can add two more products to the list now due to new retaliatory complaints filed last week.

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  • Obstructive Sleep Apnea Treatment Mask Systems

Exactly one week after ResMed filed a complaint against Fisher & Paykel in Sleep-Disordered Breathing Treatment Mask Systems, F&P retaliated with this complaint of its own.  Both companies design and supply CPAP machines and masks for numerous markets around the world.  They also, apparently, each own patents covering various designs and features meant to make CPAP masks less uncomfortable.  These ITC complaints are part of a years long international patent litigation battle between the two competitors.  As noted in a previous post, ResMed has filed five complaints at the ITC related to CPAP devices since 2013, including two now against F&P.  But this new complaint will mark their first appearance as a respondent.

One peculiar aspect of these complaints is that both companies are relying on U.S. manufacturing activities as evidence of a domestic industry, but in both cases, that activity began in 2017 when the companies relocated manufacturing of existing products to the United States.  It will be interesting to see how each party tries to rebut the adequacy of the other's domestic investments without impugning their own.

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  • Semiconductor Lithography Systems

This is the third complaint filed in the last month by Dutch company ASML and its German partner Zeiss AG against Japanese rival Nikon involving lithography machines used to manufacture integrated circuits.  The three complaints allege violations of Section 337 based the same sales but different patents.  These companies are no strangers to the ITC, and Nikon has historically not fared well before the agency.  An initial determination was issued just last month in Digital Cameras (Inv. 1059) in which Zeiss and ASML successfully challenged imports of Nikon's consumer products unrelated to the lithography market.  The parties also appeared before the agency in 2002 when Nikon filed an unsuccessful complaint against ASML in Microlithographic Machines and Components Thereof (Inv. 468).  After that investigation and accompanying court litigation, the companies entered into a cross-license agreement.  That agreement has expired, and the litigation is back in full swing.   

Early Determination Decisions

The Commission recently considered requests for early disposition of key issues in two recently filed cases.  The early disposition program began in 2013 in order to provide "earlier rulings on certain dispositive issues in some section 337 investigations" in order to "limit unnecessary litigation, saving time and costs for all parties involved."  In a typical ITC investigation, all legal and factual determinations are made by an administration law judge after discovery and trial.  That means that even if a complainant's case is especially weak on a threshold issue, like domestic industry or standing, it can still drag respondents through expensive litigation on detailed and complex matters of claim construction, validity, and infringement. 

Through the early disposition process, the Commission can try to avoid that by selecting a specific issue at the beginning of an investigation and directing the ALJ "to rule on that issue early in the investigation through expedited factfinding and an abbreviated hearing limited to the identified issue."  Early determinations are expected to be issued within 100 days from the date of institution.

On September  5, the Commission decided not to grant a request from Emerson Electric for an early determination on whether complainant SIPCO can satisfy the domestic industry requirement in Wireless Mesh Networking Products.  SIPCO is a non-practicing entity relying on the activities of a third-party licensee as evidence of a domestic industry.  In denying Emerson's request, the Commission simply stated that "the issues raised may be too complex to be decided within 100 days of institution."

On September 10, however, the Commission granted a request for early disposition in Motorized Vehicles.  The respondent (Indian automaker Mahindra) has argued that complainant FCA is barred from challenging Mahindra's grille design at the ITC due to a contractual agreement the parties signed in 2009.  The administrative law judge will conduct expedited hearings to determine whether the design at issue in FCA's ITC complaint is covered by that agreement.  The target date for an early determination is December 24, 2018.  

Call your Congressman?

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Any member of the public can submit comments to the ITC in response to a request for submissions on the public interest near the end of an investigation.  Occasionally, a member of Congress will use that opportunity to support a constituent involved in a Section 337 investigation.  Most recently, Rep. Brian Higgins (D-NY) wrote the Commission to laud the economic contributions of Ivoclar Vivadent, a European denture company whose U.S. headquarters is located in Bufallo, NY.  Ivoclar is the complainant in Dental Ceramics (Inv. 1050) in which the Commission is currently considering whether to review an initial determination finding no Section 337 violation by Japan-based respondent GC Corporation.

Congressional letters are an idiosyncratic feature of ITC litigation, where a federal agency is expected to entertain overt lobbying from elected officials with control over its budget and personnel appointments seeking to influence the adjudication of a private patent dispute.  Ultimately, however, Rep. Higgins's enumeration of Ivoclar's contributions to his district are legally irrelevant to the ITC's public interest analysis, and it is exceedingly unlikely his letter will sway the Commission in any way.