IP: Lessons from the smartphone wars with recent developments at the ITC
In recent years, Section 337 investigations have become a favored forum for intellectual property enforcement, as filings have nearly tripled in the last five years.
January 28, 2014 at 03:00 AM
8 minute read
The original version of this story was published on Law.com
The International Trade Commission (ITC) conducts investigations into allegations of unfair practices in import trade, as authorized by Section 337 of the Tariff Act of 1930. In recent years, Section 337 investigations have become a favored forum for intellectual property enforcement, as filings have nearly tripled in the last five years. Most Section 337 investigations involve allegations of patent infringement. The many patent investigations relating to smartphone technology made 2013 a banner year for important ITC developments.
In any ITC patent investigation, the ITC examines three basic factors: the presence of complainant's domestic industry; whether the respondent infringes one or more U.S. patents; and whether the complainant overcomes respondent's defenses. If all factors are met, the ITC may issue a cease and desist order, which would put an automatic stop on any future sales of goods already imported by the respondent, or an exclusion order, under which the U.S. Customs and Border Patrol is authorized to prevent all of respondent's infringing products from entering the country at the border. The President, acting through the U.S. Trade Representative (USTR), has the power to disapprove — essentially a non-appealable veto — the ITC's orders. Unlike patent infringement actions in U.S. courts, the ITC is not granted the authority to issue an order regarding money damages, but the extremely rapid docket schedule and self-executing remedies can be potent weapons for quick resolution of the underlying dispute.
In a case between Apple and Samsung, the ITC issued orders that would have barred importation and sale of Apple smartphones and tablet computers found to infringe U.S. patents owned by Samsung. Samsung's patents were so-called “Standard Essential Patents” (SEPs), which means that any manufacturer whose product meets a particular industry standard must practice that patent. In another concurrent investigation, the ITC had held that it was not prohibited from the imposing exclusion orders based on SEPs.
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