On August 17, 2012, Hitachi Metals, Ltd. and Hitachi Metals North Carolina, Ltd. (collectively “Hitachi”) filed a complaint requesting that the ITC commence an investigation pursuant to Section 337.

The complaint alleges that the following entities (collectively, the “Proposed Respondents”) unlawfully import into the U.S., sell for importation, and/or sell within the U.S. after importation certain sintered rare earth magnets and products containing the same or practice methods of making sintered rare earth magnets that infringe one or more claims of U.S. Patent Nos. 6,461,565 (“the ‘565 patent”), 6,491,765 (“the ‘765 patent”), 6,527,874 (“the ‘874 patent”), and 6,537,385 (“the ‘385 patent”):

• Yantai Zhenghai Magnetic Material Co., Ltd. of China
• Ningbo Jinji Strong Magnetic Material Co., Ltd. of China
• Earth-Panda Advance Magnetic Material Co., Ltd. of China
• Skullcandy, Inc. of San Clemente, California
• Beats Electronics, LLC of Santa Monica, California
• Monster Cable Products, Inc. of Brisbane, California
• Bose Corp. of Framingham, Massachusetts
• Callaway Golf Co. of Carlsbad, California
• Taylor Made Golf Co. of Carlsbad, California
• Adidas America, Inc. of Portland, Oregon
• Milwaukee Electric Tool Corp. of Brookfield, Wisconsin
• Techtronic Industries Co., Ltd. of Hong Kong
• DeWALT Industrial Tool Corp. of Towson, Maryland
• Electro-Voice, Inc. of Burnsville, Minnesota
• Shure, Inc. of Niles, Illinois
• AKG Acoustics GmbH of Austria
• Harman International Industries of Stamford, Connecticut
• Maxon Precision Motors, Inc. of Fall River, Massachusetts
• Dr. Fritz Faulhaber GmbH & Co., KG of Germany
• Micromo Electronics, Inc. of Clearwater, Florida
• TELEX Communications, Inc. of Burnsville, Minnesota
• Bosch Security Systems, Inc. of Burnsville, Minnesota
• Electro-Optics Technology, Inc. of Traverse City, Missouri
• Nexteer Automotive Corp. of Saginaw, Missouri
• Bunting Magnetics Co. of Newton, Kansas
• Viona Corp. of Syosset, New York
• Allstar Magnetics LLC of Vancouver, Washington
• Dura Magnetics, Inc. of Sylvania, Ohio
• Integrated Magnetics, Inc. of Culver City, California

According to the complaint, Hitachi is a pioneer in the field of sintered rare earth magnets, relatively small and light but extremely powerful magnets useful in a wide range of applications from power steering motors to speakers.  The ‘565 patent is directed to a method of pressing rare earth allow magnetic powder to make green compacts that are processed further into sintered rare earth magnets.  The ‘765, ‘874, and ‘385 patents are broadly directed to methods for manufacturing alloy powder of a specific type of rare earth magnets.

The complaint divides the Proposed Respondents into groups based on the general category of product they produce.  The general categories include sintered rare earth magnets (one of the largest groups), audio devices (also a large group), and smaller groups including power tools, motors, electronic circuitry components, automobile component assemblies, and sporting accessories and apparel.  The complaint describes the allegedly infringing activity of each Proposed Respondent and lists accused products for each together with comprehensive claim charts matching infringement activity for each respondent to claims from each asserted patent.

The complaint indicates that none of the asserted patents have been the subject of any other litigation proceeding.

Hitachi asserts that it meets both the economic and technical prongs of the domestic industry requirement, emphasizing that it has been at the forefront of the development of sintered rare earth magnets and magnetic materials and the resulting industries for many years.  Hitachi notes it has “made significant investments to ensure it will have sufficient sources of rare earth materials” in order to meet increasing global and domestic demand and has entered into a supply agreement with the “Western hemisphere’s larges producer of rare earth materials.”  With these investments, Hitachi “expects to begin producing sintered rare earth magnets covered by the asserted patents starting in 2013,” meeting the requirement of a domestic industry that is “in the process of being established.”

With respect to potential remedy, Hitachi requests that the Commission issue a permanent general exclusion order and permanent cease and desist orders directed at the Proposed Respondents in relation to products including sintered rare earth metal magnets.