Sixty new Section 337 related complaints were filed at the ITC in 2016—a 50% increase over the previous year.  This marks a reversal of a trend that saw a reduction of complaints from seventy-two in 2011 to only forty in 2015.  The sixty complaints in 2016 included fifty-four for new violation proceedings, one request each for an advisory opinion and modification of remedial orders, and four enforcement actions.

2016’s tally exceeds the number of complaints in each of the previous four years (2012-2015), and only lags behind the 2011 numbers—the height of the so-called ‘smartphone wars.’

Source: https://pubapps2.usitc.gov/337external/

In the previous peak year, 2011, the ITC received seventy-two complaints, including sixty-eight for new violation proceedings.  This dropped to forty-one violation proceeding complaints in 2012 all the way down to a low of thirty-seven in 2014.

Some recent developments may shed some light on the ITC’s resurgence in popularity.  A relatively recent phenomenon in patent litigation has been AIA Inter Partes Review (IPR) invalidity proceedings at the USPTO.  District courts have routinely stayed patent cases pending resolution of IPR proceedings.  In contrast, the ITC has never granted a stay of an investigation for an IPR.  2016 saw the ITC make its lack of deference to IPRs clear when it refused to invalidate claims that were previously found to be unpatentable in an IPR (Certain Three-Dimensional Cinema Systems and Components Thereof, Inv. No. 337-TA-939).  The ITC’s willingness to continue with investigations in parallel with IPR proceedings and to rule on patents differently than the USPTO sets the ITC apart from district courts and makes the ITC an attractive forum.

Another recent development in ITC jurisprudence is the Federal Circuit’s en banc Suprema decision.  In that case, the court held that articles that do not directly infringe until after they have been imported into the United States may nonetheless qualify as “articles … that infringe” that can be excluded from entry by the ITC pursuant to Section 337.  The Suprema decision reduced potential uncertainty over the viability of method patents and induced infringement claims in Section 337 investigations.

In addition to these developments, Section 337 proceedings at the ITC remain a strong alternative to district court because the standard remedy is the issuance of an order excluding the offending imports from the U.S. market.  To obtain similar relief in district court requires satisfaction of the Ebay factors including a showing of irreparable injury and that remedies available at law—such as monetary damages—are inadequate to compensate for the injury.

Given the ITC’s advantages with respect to IPR proceedings and injunctive remedy, as well recent developments clarifying the law with respect to indirect infringement, the trend of increased Section 337 investigations in the ITC is expected to continue.

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