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The ITC handles IP disputes involving imported goods under Section 337 of the U.S. Tariff Act. These cases have the potential to shut foreign competitors out of the U.S. market or to preserve an importer's continued access to U.S. consumers. Finnegan’s combination of specific ITC litigation experience and deep technical expertise can provide the advantage needed to succeed in this unique forum.
Complex technology, law, and procedures
Litigating in the ITC has a unique set of challenges—presenting technologically complicated cases in a specialized court that can make or break the commercial success of the products at issue. About 95 percent of all Section 337 cases involve patent infringement disputes, and most of them involve complex technology. Like district court patent infringement actions, Section 337 cases require a command of patent law, the engineering and scientific background to evaluate the technology efficiently and knowledgably, a working understanding of the patent prosecution process that produced the patents at issue, and the patent litigation experience to formulate strategies and focus judges on the essential issues.
While similar to district court proceedings, the ITC is an administrative law court with unique jurisdictional authority, governed by different substantive law, which follows its own procedural rules and issues unique remedies. The ITC has in rem jurisdiction over all goods imported into the U.S. and thus can reach companies located abroad that are outside the jurisdiction of district courts. In addition to the substantive elements that must be proven in a district court proceeding, the ITC also requires a technical and economic analysis of the domestic industry and proof that the products are imported at some point in their manufacturing or distribution life cycle. ITC Section 337 cases are also governed by the Administrative Procedure Act and the ITC’s own Rules of Practice and Procedure, as well as the Ground Rules of the individual judges, all differing in many important respects from district court proceedings. And after the satisfying the unique remedy, bonding, and public interest elements of Section 337, only the ITC has the power to issue exclusion orders directing the U.S. Customs and Border Protection to stop further importations of products found in violation of Section 337.
Expedited proceedings
ITC Section 337 cases have expedited procedural schedules. Most district courts provide two or more years to prepare for patent infringement trials (at least a year in the fastest courts), but ITC cases routinely proceed to trial about 10 months after filing the complaint. Since trials trigger settlements, the average time to settlement is fast in the ITC. The administrative law judges announce their initial decisions about three months after trial, the commission issues its final decision and any remedial orders about four months later, and the entire proceeding is typically completed in about 15-18 months.
Unique remedies: post-eBay injunctive relief
When the ITC finds a violation of Section 337, it issues injunctive-type remedial orders. It can issue “exclusion orders” directing U.S. Customs and Border Protection to stop further importations of infringing products. In addition, if there are commercially significant inventories of the respondent’s infringing imported product in the U.S., the ITC has discretion to issue “cease and desist” orders that prohibit various commercial activities, such as further distribution, sales, or upgrades. Although the ITC’s exclusion orders are available only to remedy the importation of goods that infringe an IP right that is also practiced by a domestic industry, the globalization of production, distribution, and marketing has made these remedies increasingly important, particularly in light of the Supreme Court’s 2006 decision in eBay v. MercExchange LLP, which has made injunctions more difficult to obtain in district court proceedings.
Unmatched experience
The ITC practice at Finnegan is one of the most experienced in the U.S. More than a third of the firm’s lawyers have litigated in the ITC, and many have litigated multiple cases; six of the firm’s lawyers have worked at the ITC as either Staff Trial Attorneys or Advisors to the Administrative Law Judges; and over the course of their careers, our ITC litigators have been involved in more than 20 percent of all the ITC cases ever filed.
ITC cases are 10 times more likely to go to trial than a district court patent infringement case. Thus, it is essential to have a firm with ITC trial experience to see clients through from beginning to end. ITC trials typically involve hundreds or even thousands of evidentiary exhibits, and direct testimony is often written instead of oral. The evidentiary record must be crafted to satisfy both the administrative law judge and the ITC commissioners who may later review and revise the decision. Only those litigants that are thoroughly prepared can demand the most favorable settlements on the courthouse steps or proceed with confidence to defend their rights at trial.
Finnegan’s ITC practice draws upon all the firm’s practice groups—Electrical and Computer Technology, Biotechnology/Pharmaceutical, Chemical/Metallurgical, Mechanical, and Trademark—to forge litigation teams with the working knowledge of the law and technology necessary for success. During the past 10 years, more than half of all ITC cases have involved electrical and computer-related technologies and semiconductors. Finnegan has nearly 100 lawyers and another 40 professionals who have at least one degree in electrical engineering, computer science, or some other form of specialized IT technology, and many of them have ITC experience. Finnegan also has practitioners with ITC experience in the chemical, pharmaceutical, and mechanical fields. Our attorneys have even tried ITC cases involving design patents and trademarks.
Of course, large-scale litigation often involves multiple proceedings. The patents at issue in ITC proceedings are sometimes attacked in reexamination proceedings at the U.S. Patent and Trademark Office. This process is regularly handled by our patent prosecutors, many of whom are former PTO patent examiners. Those patents are often asserted in counterpart district court actions where we call on our jury trial lawyers. And nearly all ITC patent-related decisions are appealed. Finnegan’s trial teams are backed by one of the country’s leading appellate practices. Our attorneys have briefed and argued more cases before the U.S. Court of Appeals for the Federal Circuit than any other law firm.
Global capabilities
ITC Section 337 cases involve the full range of formal discovery, motions, trials, and appeals, but with the additional challenges of operating in the technology, manufacturing, and marketing capitals around the world. Finnegan is proud of our highly diverse attorneys and staff—we have dozens of professionals who speak over 25 languages and have working knowledge of foreign cultures and business practices. The ITC’s procedures put those resources to work every day: documents are reviewed in their native language, depositions take place around the world, and our attorneys prepare witnesses for testimony that will be translated at trial. While ITC cases are filed and tried in Washington, the proceedings involve parties from around the globe. Finnegan’s U.S. and internationals offices are well positioned to serve the needs of the firm’s clients and lawyers in our ITC practice.
- Nearly 25 percent of all ITC cases involve products and parties from Taiwan. In 2003, we were the first U.S. firm with a significant IP capability to open a Taipei office.
- Another 20 percent involve Japanese products—and Finnegan has had an office in Tokyo since 1988.
- 33 percent of the cases involve Chinese companies, and we established our Shanghai office in 2008.
- Our Palo Alto office is also advantageously positioned, as many ITC cases involve Silicon Valley companies.
- Our Cambridge office services information and biotechnology innovators in the northeast United States.
- European companies are high-stakes complainants and respondents in the ITC, and our Brussels office puts us in the center of Europe.
- And back in Washington, DC, our home office is minutes from the ITC, where we litigate every day.
Representative Engagements
A complete ITC victory for Halliburton
Petredat sought an ITC order excluding Halliburton’s petroleum well-data recorders from importation and sale in the U.S. Early in the proceedings, we showed Petredat why Halliburton’s products were not covered by the Petredat patent, why the Petredat patent was invalid, why Petredat lacked a good-faith basis for filing its complaint, and after we identified counterclaims that Halliburton could assert against Petredat, the ITC case was promptly settled without trial.
A fast-track trial and settlement for Integri-Test
We filed an ITC patent infringement action for Integri-Test with a request for a temporary exclusion order against circuit-board testing equipment imported into the U.S. by Bath Scientific and BSL North America. A five-day trial was held one month after the case began, and a settlement was reached before a final decision on the merits.
A series of victories for Zoran results in a favorable settlement
We represented Zoran in two ITC investigations against MediaTek involving optical disk controller chips, acting as co-counsel with another firm. In Zoran’s affirmative case against MediaTek, the administrative law judge found in favor of Zoran after trial, and the commission ultimately entered an exclusion order against MediaTek’s infringing chips and products of many of its customers. In MediaTek’s case against Zoran, the judge exonerated Zoran’s products after a trial and found one of the two asserted patents invalid. Following issuance of the exclusion order in the first case, we also obtained a favorable ruling before the Customs Service excluding MediaTek’s supposed design-around chip. That series of victories resulted in a very favorable settlement.
Broadcom and Altima Communications–successfully defending four separate patents in a complex case
Finnegan defended Broadcom’s Altima subsidiary against Intel’s patent infringement allegations based on four separate patents in two different ITC actions and two different district court cases. Intel withdrew the first patent before trial when we found invalidating prior art. The second patent we proved invalid at trial, and Intel did not seek an appeal. For the third patent, we proved that 14 of 18 claims were invalid and our clients were entitled to use any pattern of solder balls other than a “bulI’s-eye” pattern. And the ITC’s decision in Intel’s favor on the fourth patent was later rejected in the district court case when the judge issued a published decision in Altima’s favor on all claim construction issues.
Defending ADT, Actron AG, and Tokai Denshi against attempt to block importation of resonate tags
We defended ADT, Actron, and Tokai Denshi against Checkpoint Systems’ attempt to block their importation of resonate tags used to detect merchandise theft. At trial before the ITC judge, we proved that Checkpoint’s patent was invalid on an unusual basis: another Checkpoint employee had conceived and reduced to practice the claimed invention before the work of the inventor named in the patent. The full commission agreed. We then successfully defended that decision on appeal, where the Federal Circuit not only affirmed the decision, but also bestowed a “chutzpah” award on our adversary.
Defending First International Computer, FIC America, and Everex’s right to import chips and motherboards
Finnegan defended First International Computer (FIC), FIC America, and Everex against an ITC case brought by Intel Corporation concerning personal computer motherboard chipsets.
Gold Peak Battery Company avoids trial and maintains a competitive position
Finnegan defended four different affiliates of GP Batteries International Ltd. in an alkaline battery patent infringement case filed by Eveready at the International Trade Commission against 26 respondents. SEC records indicated that Duracell had previously paid Eveready $20 million for a license under the Eveready patent and that Rayovac and Panasonic had also been forced into paying Eveready a royalty for their alkaline batteries. Working closely with the Chairman of the Board, we devised a defense that resulted in a settlement agreement prior to trial that other respondents characterized as a "walk-away" deal.
ITC victory for Toyota keeps U.S. market open for hybrids
Since 2000, Toyota has sold over 500,000 hybrid vehicles in the U.S. When its right to bring certain vehicles into the U.S. was challenged, the company needed fast and decisive relief. We represented Toyota before the ITC and argued that there was no violation of Section 337 or patent infringement.
Organon Teknika–U.S. market remains open for virus diagnosis and quantification kits
We represented Organon Teknika against Hoffman-La Roche’s patent infringement claims in the ITC. Hoffman-La Roche asserted that its patents for polymerase chain reaction (PCR) were infringed by Organon’s nucleic acid sequence-based amplification (NASBA) kits for diagnosis and quantification of certain viruses. We reached a favorable settlement agreement without trial, thereby permitting Organon to market its NASBA kits in the U.S.
Protecting Crucible Materials Corporation from eight competitors
On behalf of Crucible Materials, we filed an ITC patent infringement case involving industrial neodymium-iron-boron magnets and prevailed against all eight respondents. We obtained a combination of consent orders, cease and desist orders, limited exclusion orders, and general exclusion orders against Chinese competitors. The general exclusion order prohibits all of Crucible’s foreign competitors from importing infringing magnets, regardless of whether they were parties to the ITC case. We later brought an enforcement action that resulted in civil penalties of $1.5 million against several respondents. The civil penalty was affirmed on appeal.
Protecting System General’s product line
Finnegan represented System General as a respondent in an investigation involving power supply controllers found in many modern electronic devices. Complainant Power Integrations asserted infringement of four patents against System General’s entire product line. But the patent that threatened all of System General’s products was withdrawn when we found invalidating prior art, and another patent was withdrawn before trial.
Success for Tyco in fast-moving case
We represented Tyco Healthcare in bringing a complaint against Absormex for importation of infringing absorbent garments from Mexico. The investigation was one of the fastest ITC cases to get to trial, with a trial date less than six months from the start of the investigation. On the last day before the trial was to begin, a favorable settlement was reached, and the case was terminated.
Successfully defending Fujitsu in the largest-ever ITC investigation
We defended Fujitsu in the largest-ever ITC investigation involving 10 different Texas Instruments’ DRAM patents. More than 450 motions were decided by the ITC judge, and there were three separate trials. The claims against Fujitsu were settled before a final decision on the merits.
Successfully proving noninfringement for Topcon Instrument’s glaucoma device
We defended Topcon Instrument against a multipatent ITC case brought by Cambridge Instruments involving devices for diagnosing glaucoma. In a one-week trial held just two months after the case began, we established that Topcon’s instruments were not covered by the patents, and the ITC judge thus denied Cambridge Instruments’ motion for temporary relief.
U.S. market remains open for TEAC Corporation
We defended TEAC in an ITC case brought by Tandon Industries involving the head assemblies in floppy disk drives. While a temporary exclusion order was granted against all respondents, we later established that TEAC's head assemblies were not covered by the patent. The matter was favorably settled on behalf of TEAC before the hearing on permanent relief, and the noninfringement position we devised was successfully asserted by the remaining respondent. That noninfringement defense was adopted by the judge, the full ITC, and ultimately, the Federal Circuit.
Victory at the ITC and Federal Circuit keeps the U.S. market open for Hoechst AG
Finnegan successfully defended Hoechst against patent infringement claims by Kaken Pharmaceuticals in the ITC. Kaken sought to exclude Hoechst’s agricultural feed products containing salinomycin, an antibiotic, from U.S. markets. We persuaded the ITC that the Kaken patents were invalid and unenforceable on the grounds of inequitable conduct.
Winbond Electronics prevails in complex ITC case
We defended Winbond against Oak Technology’s patent infringement claims concerning controller chips for optical disks. After we successfully defended against Oak’s motions for summary judgment, we filed a motion to compel production of Oak’s attorney-client communications based on the crime/fraud exception, and the case was promptly settled without a trial.
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