Posts Tagged: "International Trade Commission"

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.

In late August, the U.S. International Trade Commission published a notice of institution of a Section 337 investigation on behalf of the Regents of the University of California, which is now underway. The University filed a complaint in July alleging that a series of major retailers including Amazon.com, Bed Bath & Beyond, IKEA, Target and Walmart have infringed patents through the importation of certain filament light-emitting diodes (LEDs) and products containing the same. The ITC action is part of an enforcement campaign that is being hailed by the firm representing the university as a “first-of-its-kind university-led effort” to vindicate patent rights owned by the institution.

This week in Other Barks & Bites: WIPO launches dispute resolution service for Chinese domain names; Morrison Foerster report shows that IP litigation costs are increasing as the number of IP matters being handled are decreasing; the Federal Circuit issues precedential decisions upholding claim construction findings at the ITC and overturning a district court jury verdict finding invalidity for being unsupported by record evidence; the Second Circuit clarifies when profits can be awarded in trademark cases; Uber IP transfer creates $6.1 billion tax break for the company; major football associations call for crackdown on Saudi piracy service; OPPO inks patent agreements with Intel and Ericsson; and Broadcom acquires Symantec’s enterprise security business.

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.

On March 20, U.S. District Judge Gonzalo Curiel of the Southern District of California issued an order denying a motion by Apple, which was seeking partial judgment against Qualcomm on that company’s claim that it had fulfilled its fair, reasonable and non-discriminatory (FRAND) obligations for licensing its standard-essential patents (SEPs). As a result, Qualcomm can move ahead with its efforts to prove that its SEP portfolio licensing activities have met the company’s FRAND obligations and that Apple has forfeited its right to FRAND licensing because it hasn’t been a willing licensee.The court sided with Qualcomm in finding that Apple’s arguments regarding the unsuccessful licensing negotiations presented a definite and concrete controversy. Qualcomm had cited to a 2017 Eastern District of Texas case, Huawei Techs. Co. v. T-Mobile US, Inc., to show an instance where a court had found subject-matter jurisdiction in a case where a patent holder sought a declaration that it had complied with FRAND obligations. In the current case, Apple hadn’t stated unequivocally that it wouldn’t pursue a stand-alone breach of contract action, giving rise to a substantial controversy with sufficient immediacy and reality to justify declaratory relief. A favorable outcome to Qualcomm on this claim would afford additional relief, as Qualcomm could demonstrate that Apple had engaged in unreasonable holdout behavior, relieving Qualcomm of further FRAND obligations towards Apple.

n an age with instantaneous commentary on social media, the wheels of justice in courts seem to move at a glacial pace, especially in patent infringement lawsuits in the fast-paced smartphone industry. Yet, courts have been methodically receiving and meticulously reviewing the evidence in Qualcomm’s lawsuits against Apple Computer for infringing its patents. And, like the tortoise who eventually wins over the speedy hare, the judgments are just now coming out against Apple. This past December, a Chinese court issued a preliminary injunction against Apple selling iPhones that infringed Qualcomm’s patents. A week later, A German court issued an injunction against Apple selling iPhones in that country that infringed Qualcomm’s patents. Last week, a jury in the United States found Apple liable for infringing Qualcomm’s patents and awarded Qualcomm $31 million in damages.

A number of organizations, including Ericsson, Nokia, Philips, Qualcomm, the Innovation Alliance and the Licensing Executives Society, have sent two separate letters to U.S. Attorney General William Barr, USPTO Director Andrei Iancu, and Secretary of Commerce Wilbur Ross stating their support for the United States’ decision to withdraw the Department of Justice, Antitrust Division’s assent to the 2013 joint DOJ-U.S. Patent and Trademark Office “Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments” (the 2013 Joint Policy Statement). The letter sent by Ericsson, Nokia, Philips, and Qualcomm begins by explaining that those signing the letters collectively spend many billions of dollars annually to “the development of cutting-edge that substantially contribute to the social welfare and quality of life of U.S. consumers,” and “and employ tens of thousands of people in the U.S.” The letter goes on to explain that injunctions are necessary to address the widespread patent infringement that has occurred in recent years; infringement that risks innovators’ ability to continue to innovate and create next generation technologies. Without property protections it is economically irrational to invest the billions of dollars required to create cutting-edge technologies.

This week in Other Barks & Bites: the USPTO appoints a new Chief Information Officer; Apple uses Qualcomm chips in Germany while American professors urge the ITC to deny exclusion of iPhones found to infringe Qualcomm patent claims; two important IP cases will be heard by the U.S. Supreme Court next week; the EU approves copyright reforms, including the hotly-debated Article 13; Fresh Prince of Bel-Air star Alfonso Ribeiro runs into issues at U.S. Copyright Office; Facebook could owe billions in fines for consumer data practices; a jury verdict dings Walmart for nearly $100 million in trademark infringement case; and Google announces multi-billion dollar plan to expand offices and data centers across the United States.

5G, or 5th generation wireless communication, has reached the point of determining which core technologies will be used. Suddenly, decisions about which companies will be picked are upon us. And the stakes could hardly be higher — for the companies and for our national (and American citizens’) security. The two businesses in the ring, Qualcomm and Huawei, each find themselves in a tough fight to dominate the IP-based 5G technology on which countless devices—from automobiles to mobile phones to who-knows-what—will interoperate. The 5G platform will empower the Internet of Things, artificial intelligence writ large and more—a technological advance with tremendous potential as well as tremendous risk exposure to spies, hackers and such. Both companies face hurdles from the U.S. government. One makes sense. The other makes no sense.

Standard Essential Patents (SEPs) are patents that are unavoidable for the implementation of a standardized technology. They represent core, pioneering innovation that entire industries will build upon. These patents protect innovation that has taken extraordinary effort to achieve. Standard Development Organizations (SDOs) exist as a mechanism for industry innovators to work together to collectively identify and select the best and most promising innovations that will become the foundation for the entire industry to build upon for years to come. Those contributing patented technologies to the development of a standard are asked to provide a FRAND (which stands for Fair, Reasonable and Non-Discriminatory) assurance, in essence committing to providing access to patents that are or may become essential to the implementation of the standard.

In devices such as the iPhone, Apple and Intel merely operate on the technological connectivity platform Qualcomm created. In short, what Intel does well doesn’t compete meaningfully with Qualcomm where American 5G leadership is concerned… Apple’s cavalier conduct toward other people’s intellectual property should run into a red, white and blue brick wall at the American border, courtesy of the ITC, in the form of immediately effective exclusion and cease-and-desist orders, keeping iPhone imports that infringe Qualcomm’s patents out of the United States.

Although many readers might be more familiar with patent infringement claims asserted in Section 337 actions at the ITC, BIC Vice President and General Counsel Steve Burkhart notes that trademark and trade dress infringement claims in a Section 337 context aren’t terribly different. “We’ve had our three-dimensional trademark registration for decades,” Burkhart said, adding that one of the defendants in the ITC action was familiar with BIC’s trademark because it was cited as a basis for denying their own trademark application filed with the U.S. Patent and Trademark Office. “Quantitatively, you may see more Section 337 filings on the patent side but there are many examples in the patent and trademark areas where filings encounter denials because of prior art,” Burkhart said.

The Federal Circuit panel of Chief Judge Sharon Prost and Circuit Judges Jimmie Reyna and Kimberly Moore determined that the ITC erred in applying res judicata to deny the petition without considering the effect of district court litigation which invalidated the claims asserted in the Section 337 proceeding… Ultimately, the Federal Circuit ruled that the ITC is not barred from reassessing the EPROM factors and determining whether to modify or rescind the civil penalty based on the final judgment of invalidity. The ITC’s decision was, therefore, reversed and the case remanded for the Commission to consider whether to rescind or modify the civil penalty in light of the final judgment of invalidity of the relevant claims.

On October 30, the Federal Circuit Court of Appeals reversed a decision from the International Trade Court invalidating the Converse Chuck Taylor sneaker design trade dress.  Converse Inc. v. ITC, No. 2016-2497, 2018 WL 5536405 (Fed. Cir. Oct. 30, 2018).  At first glance, this appeared to be great news for Converse.  However, the decision highlights multiple obstacles that Converse, and other brand owners, will continue to face as they seek to enforce product design trade dress in the US.

An administrative law judge at the U.S. International Trade Commission recently found patent infringement in Qualcomm’s case against Apple, but then inexplicably refused to recommend that the commission issue an exclusion order against infringer Apple. Is there some new standard that “established and profitable companies” are no longer deserving of ITC action?  The International Trade Commission is in danger of causing the same harm to patent rights as the U.S. Supreme Court has inflicted on patent owners with the court’s lame-brained eBay decision.