Wednesday, June 5, 2013

U.S. ITC to Exclude Apple Devices Incorporating Patent Subject to FRAND Obligation

As reported yesterday on the Essential Patents Blog and the Wall Street Journal, the ITC has ruled in Investigation No. 337-TA-794 to issue a limited exclusion order prohibiting Apple from importing certain models of its iPhone and iPad (though not the latest-generation products) into the United States.  Here's a copy of the four-page Notice of Final Determination.  (It doesn't appear that there is a publicly available opinion yet.)  The interesting part, from the standpoint of patent remedies, is this:
The Commission has determined that the appropriate remedy is a limited exclusion order and a cease and desist order prohibiting Apple from importing into the United States or selling or distributing within the United States wireless communication devices, portable music and data processing devices, and tablet computers that infringe claims 75-76 and 82-84 of the ’348 patent. The Commission has determined that the public in terest factors enumerated in section 337(d)(1) and (f)(1) do not preclude issuance of the limited exclusion order and cease and desist order. The Commission has determined that Samsung’s FRAND declarations do not preclude that remedy.  
Finally, the Commission has determined that a bond in the amount of zero percent of the entered value is required to permit temporary importation during the period of Presidential review (19 U.S.C. § 1337(j)) of wireless communication devices, portable music and data processing devices, and tablet computers that are subject to the order. The Commission’s order and opinion were delivered to the President and to the United States Trade Representative on the day of their issuance.
Commissioner Pinkert dissents on public interest grounds from the determination to issue an exclusion order and cease and desist order.
As I have discussed elsewhere, I think that a FRAND declaration generally should preclude entry of an exclusion order.  I'll be interested to read the Commission's opinion and Commissioner Pinkert's dissenting opinion when public versions become available.

Further to the above.  The president has the authority to veto a Commission's exclusion order.  As others have pointed out, this hasn't actually happened since the 1980s.  But yesterday President Obama issued a series of executive orders and recommendations to Congress on patent litigation, see coverage in WSJ here and the White House's fact sheet here.  One of the recommendations is that Congress should "Change the ITC standard for obtaining an injunction to better align it with the traditional four-factor test in eBay Inc. v. MercExchange, to enhance consistency in the standards applied at the ITC and district courts."  At the same time, though one of the executive orders is:
Strengthen Enforcement Process of Exclusion Orders. Once the U.S. International Trade Commission (ITC) finds a violation of Section 337 and issues an exclusion order barring the importation of infringing goods, Customs and Border Protection (CBP) and the ITC are responsible for determining whether imported articles fall within the scope of the exclusion order. Implementing these orders present unique challenges given these shared responsibilities and the complexity of making this determination, particularly in cases in which a technologically sophisticated product such as a smartphone has been successfully redesigned to not fall within the scope of the exclusion order. To address this concern, the U.S. Intellectual Property Enforcement Coordinator will launch an interagency review of existing procedures that CBP and the ITC use to evaluate the scope of exclusion orders and work to ensure the process and standards utilized during exclusion order enforcement activities are transparent, effective, and efficient.
 We are living in interesting times . . . 

No comments:

Post a Comment