09
Jun
By Eric Schweibenz
On June 7, 2010, ALJ E. James Gildea issued the public version of Order No. 20 (dated May 20, 2010) in Certain Video Displays, Components Thereof, and Products Containing Same (Inv. No. 337-TA-687) granting a motion for summary determination filed by Complainant LG Electronics, Inc. (“LG”).

In support of its motion that it satisfied the economic prong of the domestic industry requirement, LG argued that it made significant investments in post-sale service and engineering for certain LG LCD and plasma televisions covered by the four patents-in-suit.  Respondents Vizio, Inc., AmTran Technology Co., Ltd., and AmTran Logistics, Inc. (collectively, “Respondents”) opposed the motion arguing that LG’s activities supporting its economic domestic industry argument were not substantial and that genuine issues of material fact prevented a grant of summary determination on this issue.  The Commission Investigative Staff (“OUII”) filed a response in support of LG’s motion arguing that “there is no genuine issue of material fact that LGE through certain expenditures of its wholly owned U.S. subsidiary LG Electronics, Inc. Alabama (‘LGE-AL’), has demonstrated that it has made a substantial investment in the exploitation of the four patents in suit, thus satisfying the requirements of 19 U.S.C. § 1337(a)(3)(C).”

In the Order, ALJ Gildea rejected Respondents’ arguments that (i) a selection of representative products is insufficient to demonstrate an economic industry with respect to the asserted patents, (ii) Respondents have not had sufficient time for discovery with respect to economic domestic industry, and (iii) LG’s evidence involving service of the LG products, such as phone calls, repair orders, warranty claims, or return authorizations, “is objectionable merely because LG’s witness was unable to allocate what percentage of each LG’s employee’s work time related directly to the LG products.”  Further ALJ Gildea disagreed with OUII’s argument that LG’s figures relating to customer calls, return authorizations, technician calls, and product repairs and refurbishments for the LG products cannot support an economic domestic industry finding.  Specifically, ALJ Gildea determined that:
While it is true that there does not appear to be associated cost information for these service activities, it is possible to make a showing of economic domestic industry based on significant employment of labor and capital.  19 U.S.C. § 1337(a)(3)(B).  This portion of the statute does not appear to be as strictly tied to monetary expenditures, as [OUII] seems to suggest, because the wording (‘employment’) differs from sections (A) and (C) (‘investment’).  Domestic activities relating to customer support, quality control, and repairs for similar products/industries have supported a finding of economic domestic industry under either section (B) or (C).

(Citations and emphasis omitted).

Accordingly, ALJ Gildea granted LG’s motion and held that “[e]ven viewing all evidence in the light most favorable to Respondents and drawing all justifiable inferences in favor of Respondents, it is clear that LG has made a substantial investment in the exploitation of articles protected by the asserted patents based on its post-sale service and engineering activities (Warranty Activities), and has made significant employment of labor and capital in the United States (Call Center, Return, Technician, and Repair Activities) with respect to the representative LG Products alleged to practice the asserted patents.”
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