Opening Moves in the ITC: Strategic Considerations for Pre-Institution Filings in Section 337 Investigations

The period following the filing of a section 337 complaint with the U.S. International Trade Commission (ITC) can be chaotic. During this period, the Commission “examine[s] the complaint for sufficiency and compliance with” its rules, 19 C.F.R. § 210.9(a), routinely asks the complainant to provide additional information, and typically decides whether to institute an investigation within 30 days after the complaint is filed, see 19 C.F.R. § 210.10(a)(1). The complainant must address the Commission’s requests for additional information while preparing for the coming investigation. The named respondents must scramble to find counsel, assess the allegations, and ready for battle. And all section 337 litigants confront a series of strategic decisions that can send them on the path to success or failure in the investigation.

One set of decisions facing section 337 litigants concerns the filings that the ITC considers when deciding whether to institute an investigation. Two types of filings exist—one addressing the public interest implications of the complaint; the other addressing “other issues.” This article discusses the strategies that come to bear on these submissions. ITC litigants must develop these strategies mere days after a new complaint is filed, and understanding the considerations in advance can help determine the approach that best fits the particular investigation.

The ‘Other Issues’ Filing

We start with the broader class of the pre-institution filings, which concerns “other issues.” While this class of filings appears unbounded, in practice there generally are two purposes for which respondents submit them: (1) requests for the ITC to dismiss all or part of the complaint; and (2) requests for an expedited proceeding as to one dispositive issue in the investigation. The Commission Rules do not expressly authorize these submissions, but they have long formed a standard part of section 337 practice, and the ITC’s notices of receipt of complaint implicitly authorize “written submissions on other issues” within eight days after the notices publish in the Federal Register. See, e.g., Not. of Receipt of Compl., 88 Fed. Reg. 46,182, 46,183 (Int’l Trade Comm’n July 19, 2023).

With respect to the first purpose, although the Commission Rules do not allow motions to dismiss, respondents can effectively seek dismissal via “other issues” submission by asking the ITC to decline to institute all or part of the investigation requested in the complaint. Such attempts usually fail. Section 337 leaves little wiggle room for the ITC to deny institution—it states, “The Commission shall investigate any alleged violation of this section on complaint under oath or upon its initiative.” 19 U.S.C. § 1337(b)(1) (emphasis added). In addition, longstanding precedent requires the Commission to resolve most challenges on the merits. See Amgen Inc. v. ITC, 902 F.2d 1532, 1535–37 (Fed. Cir. 1990).

Non-institution requests therefore should be reserved for extreme edge cases, such as when the complaint states a claim that is not cognizable under section 337. See, e.g., Amarin Pharma, Inc. v. ITC, 923 F.3d 959 (2019) (affirming non-institution of complaint based on FDCA, which did not authorize a private right of action). In all other cases, Respondents should keep their powder dry for the merits phase of the investigation. Doing so preserves resources and credibility, provides greater flexibility to sharpen arguments, and keeps cards closer to the vest, leading complainants less time to develop counters.

“Other issues” submissions can be useful, however, when they seek to narrow the scope of an investigation, rather than to avoid institution altogether. The Commission has narrowed investigations based on pleading deficiencies as to particular respondents, IP rights, or accused product categories. See, e.g., Laerdal Med. Corp. v. ITC, 910 F.3d 1207, 1210 (Fed. Cir. 2018) (noting Commission decision not to institute investigation as to certain IP rights and respondents); Ltr. to C. Lehman, Esq. Re: Compl. Filed by Daedalus Prime LLC (Docket No. 3637), EDIS Doc. ID No. 781870 (U.S. Int’l Trade Comm’n Oct. 7, 2022) (explaining Commission decision to limit scope of accused products and to deny institution as to certain respondents due to inadequate importation allegations). By convincing the ITC to narrow the investigation, respondents can limit their exposure and reduce costs.

The second request frequently made in “other issues” submissions is for the ITC to order the ALJ to issue an initial determination on a “potentially dispositive issue” within 100 days of institution. 19 C.F.R. § 210.10(b)(3). Such expedited “100-day” proceedings have addressed issues such the domestic industry requirement, subject-matter eligibility under section 101, and standing. 100-day proceedings can increase the pressure on complainants by focusing the Commission on a weaker part of their case, with discovery on other issues typically stayed. Further, an adverse decision during a 100-day proceeding is case-dispositive only for the complainant; respondents remain free to litigate the remaining issues in later phases of the investigation.

Respondents nevertheless should think carefully before requesting an expedited proceeding. They can be expensive, as their compressed nature often stretches counsel thin and requires additional resources. Further, expedited proceedings afford parties less time to obtain needed discovery and hone their contentions. This can disadvantage respondents, which are generally less familiar with the facts early in the investigation. Moreover, while expedited proceedings address a single issue, the issues in section 337 investigations intertwine. For example, several expedited proceedings have concerned the domestic industry requirement’s economic prong, which can be difficult to resolve without considering the technical prong, which in turn implicates infringement. A decision on one of these issues during a 100-day proceeding can have unintended consequences for the other issues during the balance of an investigation. Respondents thus should tread lightly when considering expedited proceeding requests.

The Public Interest Submission

The other class of pre-institution filings relates to the public interest implications of the complaint and its requested remedial orders, such as exclusion orders blocking importation of accused products and cease-and-desist orders that apply to U.S. activities. Complainants must file a public interest submission concurrently with their complaint. See 19 C.F.R. § 210.8(b). Respondents may file a public interest submission within eight days after publication in the Federal Register of the ITC’s notice of receipt of the complaint. See 19 C.F.R. § 210.8(c)(1). Complainants may reply to such submissions within three days after their filing. See 19 C.F.R. § 210(8)(c)(2).

Public interest submissions provide ITC litigants two opportunities: (1) to educate the Commission about the market for the products in question and the competitive dynamics of their businesses; and (2) to argue as to whether the Commission should “delegate” public interest to the ALJ for factual development through discovery and an evidentiary hearing. Delegation does not occur in all investigations. Without it, public interest issues remain off-limits during discovery, preventing the parties from submitting evidence and arguments regarding such issues until after the ALJ’s initial determination, during briefing before the Commission.

Several considerations impact public interest delegation requests. Complainants tend to oppose delegation requests. Because public interest concerns require the ITC to consider forgoing or cabining remedial orders, the issue functions as a defense, which development via discovery and trial can strengthen. Public interest discovery can also be used for other issues, such as domestic industry and remedy, so that delegation can ease the path to obtaining evidence more broadly. And as with any expansion of the scope of discovery, public interest delegation can increase costs.

But nondelegation of public interest can adversely affect complainants. Without delegation, complainants can be blindsided by public interest issues first surfaced during the Commission briefing stage, when it is harder to marshal rebuttal evidence. This can be particularly problematic where respondents rely on nonparties, such as business partners, trade associations, and consumer groups, whom complainants will lack the opportunity to cross-examine. Consequently, where investigations are likely to raise meaningful public interest issues, complainants are often best served by supporting delegation requests and developing their positions via discovery.

For respondents, the considerations flip. Public interest delegation can increase their leverage by strengthening a defense, expanding discovery, and increasing costs. Public interest witnesses can also help humanize respondents during the evidentiary hearing, thus delivering an emotional impact missing from drier scientific or financial testimony. Finally, in some circumstances, failing to timely raise public interest issues can risk waiver. See Philip Morris v. ITC, 63 F.4th 1328, 1335 (Fed. Cir. 2023) (affirming ITC finding that respondent forfeited argument that ITC failed to consult with FDA).

There are downsides to delegation, however. Because deferring public interest until the Commission briefing provides respondents a surprise advantage, delegation eliminates that advantage. Delegation also exposes respondents’ witnesses to depositions, whereas their testimony (offered via declaration or affidavit) would otherwise escape cross-examination. And as noted above, delegation typically will increase litigation expenses.

Identifying the Right Move

A party’s strategic decisions after the filing of a section 337 complaint can impact its success before the ITC. With respect to pre-institution filings, rote approaches that fail to account for the particular circumstances at issue can lead to trouble, and the right move in one investigation may lead to checkmate in another. Section 337 litigants should therefore carefully consider what they hope to accomplish through pre-institution filings, determine how such goals would fit into their long-term strategy for the investigation, and weigh the associated downside risks.

Learn more about ITC strategies and developments by joining us at IPWatchdog LIVE on September 18 for  a panel titled “Creating Enforcement Leverage: The ITC Advantage.” Register here. 

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