By Eric Schweibenz
On July 13, 2012, ALJ David P. Shaw issued Order No. 19 denying Respondent Yue Qiu Sheng aka Jason Yue’s (“Yue”) motion for summary determination that Complainants Twin-Star International, Inc. and TS Investment Holding Corp.’s (collectively, “Complainants”) breach of stockholder agreement claim is outside the scope of the investigation in Certain Electric Fireplaces, Components Thereof, Manuals for Same, and Products Containing Same, Certain Processes for Manufacturing or Relating to Same, and Certain Products Containing Same (Inv. No. 337-TA-791/826).

According to the Order, Yue argued that the notice of investigation does not include Complainants’ breach of contract claim, nor does that claim state a violation of Section 337.  The Commission Investigative Staff supported the motion.  Complainants opposed the motion.

ALJ Shaw denied the motion, finding that it was unclear whether the alleged breach of contract could not be shown to constitute or be part of an act of unfair competition, noting that:  (1) the notice of investigation covers acts of copyright violation, trade secret misappropriation, and “unfair competition” prohibited by Section 337; (2) the Commission consolidated Investigation No. 337-TA-791 with Investigation No. 337-TA-826, and in doing so issued a notice of investigation that included Yue as a respondent and specifically directed that the investigation cover “misappropriation of trade secrets, breach of contract, or tortuous interference with contract” prohibited by Section 337; and (3) it has not been shown that breach of contract, including the breach alleged by Complainants, cannot constitute an unfair act cognizable under Section 337.