By Eric Schweibenz and John Presper
Further to our February 13, 2017 post, on March 1, 2017, ALJ MaryJoan McNamara issued the public version of Order No. 13 containing an early Initial Determination (“ID”) that Complainant Silicon Genesis Corporation (“SiGen”) satisfied the economic prong of the domestic industry requirement in Certain Silicon-On-Insulator Wafers (Inv. No. 337-TA-1025).

By way of background, this investigation is based on a May 26, 2016 complaint filed by Silicon Genesis Corporation alleging violation of Section 337 by way of unlawful importation into the U.S., selling for importation, and/or selling within the U.S. after importation certain silicon-on-insulator wafers that infringe one or more claims of U.S. Patent Nos. 6,458,672 and 6,171,965. See our May 27, 2016 and October 20, 2016 posts for more details on the complaint and Notice of Investigation, respectively.

According to the ID, SiGen established a domestic industry under 19 U.S.C. § 1337(a)(3)(A), (a)(3)(B), and (a)(3)(C) through the activities of its licensee, SunEdison Semiconductor Limited (“SunEdison”). As a threshold matter, ALJ McNamara found that SiGen’s reliance on the activities of its licensee to prove domestic industry follows “well-established practice” and is consistent with Commission Rule 210.12, and rejected Respondent Soitec, S.A.’s (“Soitec”) argument that SunEdison should have been a co-complainant in this investigation because SiGen is a “non-practicing” entity. The ALJ also found no support in the record for Soitec’s assertion that SiGen’s license with SunEdison’s predecessor-in-interest, MEMC Electronic Materials, Inc., was not properly transferred to SunEdison. In addition, ALJ McNamara determined that the current legal status of SunEdison—which was acquired by GlobalWafers Co. Ltd. after the complaint was filed—is “largely irrelevant” since the appropriate date for determining whether a domestic industry exists or is being established is the date of the filing of the complaint.

As an evidentiary matter, the ALJ determined that the fact witness testimony of Dr. Graham Fisher pertaining to SunEdison’s investments was proper even though he relied on late-produced documents that had been previously excluded because both the Administrative Procedures Act and Fed. R. Evid. 612 provide latitude in the use of documents to refresh the recollection of a witness. ALJ McNamara further noted that Dr. Fisher had extensive foundational and personal knowledge of SunEdison’s operations, consistent with Fed. R. Evid. 602 and 612.

With respect to SunEdison’s domestic industry operations, the ALJ determined that Dr. Fisher’s unrebutted testimony established SunEdison’s significant investments in plant and equipment from 2010 through September 2016, as evidenced by, inter alia, SunEdison’s facility in St. Peters, Missouri housing its corporate headquarters and serving as its primary research and development facility. The ID also mentioned a video showing SunEdison’s manufacturing process conducted in the St. Peters facility. Further, because Dr. Fisher’s testimony reflects SunEdison’s domestic investments related to the silicon-on-insulator (“SOI”) products, and SiGen asserts that all of SunEdison’s SOI investments are relevant domestic industry investments, ALJ McNamara found that “no additional allocation seems to be either possible or necessary.”

ALJ McNamara also determined that Dr. Fisher’s testimony established SunEdison’s substantial investments in research and development between 2010 and 2016. The ALJ noted, however, that Dr. Fisher’s “momentary ‘doubt’” with respect to the SOI products and the practice of at least one of the claims of each asserted patent raised enough of an issue “to reserve the question either to obtain additional evidence, or to clarify the evidence on this point, if possible.”

Moreover, the ALJ determined that Dr. Fisher’s testimony established that SunEdison’s expenditures for labor related to SOI manufacturing between 2010 and 2016 are significant and satisfy Section 1337(a)(3)(B).

ALJ McNamara did not make a determination in the ID of whether SiGen, through SunEdison, satisfied the technical prong of domestic industry, as “there appear to be disputes of fact that preclude a technical prong determination at this time.” The ALJ further noted, “[o]ut of an abundance of caution, it also appears that there is an issue of claim construction that warrants reserving the technical issue to the remainder of the Investigation for additional development.”

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