by Dennis Crouch
The U.S. International Trade Commission is a branch of the U.S. government designed to protect and serve U.S. interests. The ITC handles a variety of international trade issues, including passing judgment on whether importation of accused products constitutes actionable patent infringement. These Section 337 disputes have become more important as more expensive and high-technology products are being imported rather than being manufactured in the US and because of legal changes that have made injunctive relief relatively more likely in an ITC proceeding as compared with federal court litigation.
Although both the patentee and accused infringers have standing to argue their respective cases, ITC proceedings are administrative in nature with a focus on whether a domestic industry deserves protection. Thus, rather than being captioned Apple v. HTC, the recent dispute between the two parties has the title: In the Matter of CERTAIN PERSONAL DATA AND MOBILE COMMUNICATIONS DEVICES AND RELATED SOFTWARE, 337-TA-710.
In its decision on the case, the Commission concluded that HTC’s Android phones violated Apple’s Patent No. 5,946,647 (Claims 1 and 8) and that the HTC phones do not infringe the asserted claims of Apple’s Patent Nos. 5,481,721, 6,275,983, or 6,343,263. Commentators have noted that HTC should have little trouble designing around the the ‘647 patent. This is especially true because the Commission gave HTC four–months to alter its product before injoining further importation.
In federal court litigation, a court can only award injunctive relief after considering teh four equitable factors outlined in eBay v. MercExchange. The ITC is not bound by eBay, but is required to consider the impact that an injunction (or “exclusion order”) would have on competition and consumers. Interestingly, the ITC order follows a recent NYTimes editorial, by Professors Mark Lemley and Colleen Chien who argued for delay in exclusion orders in order to serve the public interest.
If the ITC continues to give more weight to the public interest factor, the result is that ITC exclusion orders may begin to parallel the injunction that a court would have ordered under eBay. Although the ITC still does not directly consider the first three eBay factors, it does require a domestic industry being harmed by the alleged importation. That harm is often the type of harm that would help a patentee prove its case under eBay.
- The ITC does not have power to award damages. This could suggest that the ITC decisions automatically satisfy the first-two eBay factors.
- In the Apple v. HTC case, the full decision on the merits that discusses the public interest factors has apparently been held as classified (or at least under seal). The US President has the statutory right to disapprove of the decision within the next 60 days.
- Claim 1 of the infringed ‘647 patent is the broadest of the infringed claims and is directed to a system of detecting structures in data and then performing some action on the structures. The claim reads as follows: 1. A computer-based system for detecting structures in data and performing actions on detected structures, comprising: an input device for receiving data; an output device for presenting the data; a memory storing information including program routines including an analyzer server for detecting structures in the data, and for linking actions to the detected structures; a user interface enabling the selection of a detected structure and a linked action; and an action processor for performing the selected action linked to the selected structure; and a processing unit coupled to the input device, the output device, and the memory for controlling the execution of the program routines.
- These patents were all filed in the mid-1990’s and no, Steve Jobs is not listed as an inventor of any of them.