By way of background, the ITC instituted an investigation in February 2003 based on a complaint filed by Deere alleging that Bourdeau and other Deere dealers unlawfully imported and sold Deere’s European-version harvesters in the U.S. in violation of Section 337’s prohibition against importation of products “produced by the owner of the United States trademark or with its consent, but not authorized for sale in the United States,” often called “gray market goods.”  In May 2004, the ITC determined there were material differences between Deere’s North American version and European version harvesters, supporting a finding of trademark infringement and thus a general exclusion order.

In March 2006, the Federal Circuit vacated-in-part and remanded the ITC’s decision based on the additional requirement that Deere also show that all or substantially all of its authorized domestic products (North American version) are materially different from the accused gray market goods (European version).  On remand, in December 2006, the ALJ issued an initial determination of infringement, finding that the original record showed that Deere did not authorize the sales of the European version in the U.S., that new evidence of alleged Deere financing of the European version sold by its dealers did not show authorization, and that the number of sales Bourdeau alleged were authorized was in any event so small that “substantially all” of Deere’s authorized U.S. sales were of the North American version.

In August 2008, the ITC reversed the ALJ, finding substantial evidence that Deere’s U.S. and European dealers had apparent authority to sell the European version, that Deere itself sold and/or facilitated the sale of the European version in the U.S., and that not “all or substantially all” of the authorized harvesters sold in the U.S. were the North American version.  The ITC noted that since the total number of authorized sales of the North American version in the U.S. was approximately only 4400, the introduction of even a small number of the European version could cause substantial consumer confusion.  The ITC then found such confusion based on its determination that at least 141 European version harvesters sold in the U.S. were sold by official Deere dealers.  The ITC considered 141 to be a “substantial quantity” of nonconforming goods because it constituted 40 to 57% of the 247 to 347 European version harvesters sold in the U.S. by both official and independent (in some cases, accused) dealers.  Importantly, the ITC did not use as its denominator the total number of authorized harvesters sold in the U.S., which would have been the number of authorized North American version harvesters (4400) plus the number of authorized European version harvesters (141), or 4541.

In May 2010, the Federal Circuit held that the ITC misapplied the “all or substantially all” test, and that the denominator should have been the total authorized sales in the U.S. in accordance with the court’s remand instructions, not the total European version sales in the U.S.  Using the ratio dictated by its remand instructions as well as the ITC’s lower-end and upper-end findings, the court concluded that a total of 3.1 to 3.4% of the authorized harvesters sold in the U.S. were the European version, or conversely that 96.6 to 96.9% of the authorized harvesters sold in the U.S. were the North American version.  The court observed that those figures may be insubstantial, but that is for the ITC to determine on remand based on all of the relevant facts, noting that “[t]he cutoff as to what is to be considered ‘substantially all’ is a question of fact.”  See our May 27, 2010 post for more details.

According to the January 13 notice, the Commission requested briefing on the merits of the remand, and after examining the record of the investigation, including the parties’ submissions on remand, the Commission determined that Deere established that substantially all of the U.S. sales of the subject harvesters were of the North American version, and Deere therefore met its burden to prove on remand that it satisfied the “all or substantially all” test for gray market trademark infringement.  Accordingly, The Commission reinstated the exclusion order and cease and desist orders with respect to European versions of the subject harvesters issued by the Commission in the original investigation.  Based on the above, the Commission proceeded to terminate the investigation.

By way of background, the Complainants in this investigation are Apple Inc. and NeXT Software, Inc. (collectively, “Apple”) and the Respondents are High Tech Computer Corp., HTC America Inc., and Exedia, Inc. (collectively, “HTC”).  On July 15, 2011, ALJ Charneski determined that HTC violated Section 337 through its infringement of claims 1, 8, 15, and 19 of U.S. Patent No. 5,946,647 (the ‘647 patent) and claims 1, 2, 24, and 29 of U. S. Patent No. 6,343,263 (the ‘263 patent).  The ID found no violation of Section 337 with respect to U.S. Patent Nos. 5,481,721 (the ‘721 patent) and 6,275,983 (the ‘983 patent) because Apple had not demonstrated that HTC infringed the asserted claims of these patents or that Apple had satisfied the domestic industry requirement with respect to these patents.  The ID concluded that HTC had not demonstrated that any of the asserted patent claims are invalid.  See our September 2, 2011 post for more details. 

In sum, the Commission determined that HTC violated Section 337 by importing and selling articles that infringe claims 1 and 8 of the ‘647 patent, but reversed the ALJ’s finding of violation as to claims 15 and 19 of the ‘647 patent and as to the asserted claims of the ‘263 patent.  Lastly, the Commission affirmed the ALJ’s conclusion of no violation as to the ‘721 and ‘983 patents.

The ‘263 Patent

The ‘263 patent relates to a telecommunications interface for real-time processing.  The Commission first interpreted a limitation within claim 1, which required “at least one realtime application program interface (API) coupled between the subsystem and the realtime signal processing subsystem to allow the subsystem to interoperate with said realtime services.”  The parties and the ALJ agreed that “realtime” means “within a defined upper bounded time limit,” and thus the issue was whether the term “realtime” modified each term it precedes in the claims including “API,” as asserted by HTC and the Investigative Attorney (“OUII”), or whether any “API that allows realtime interaction between” subsystems is a “realtime API,” as proposed by Apple and adopted by ALJ Charneski.  The Commission determined that the API itself has defined upper bounded time limits, and that Apple’s and the ALJ’s construction “improperly reads the term ‘realtime’ out of the API limitation,” and renders the term “realtime” at most nominal and without any purpose of its own.  Under this revised construction, the Commission determined there is no genuine dispute that the identified API in both the HTC and Apple products do not operate within a “defined upper bounded time limit.”

The Commission also reviewed the construction of the term “device handler” within claims 1 and 24.  ALJ Charneski adopted Apple and OUII’s interpretation, namely: “software associated with an interface device that sets up dataflow paths, and also presents data and commands to a realtime signal processing subsystem.”  HTC previously sought to add the requirement that the device handler be “specific to the device,” but in its briefing on Commission review, the opinion held that HTC sought instead a different argument that “associated with” in the ALJ’s construction means that “the device handler must know…about the device it supposedly handles,” as opposed to the device “merely be[ing] somewhere in the data path for data that originated at the ‘device.’”  The Commission determined that HTC’s argument concerned the application of claim construction, rather than claim construction itself, and if it were a claim construction argument, it was waived.  The Commission determined that disagreements over an application of construction “do not themselves give rise to opportunities, after the fact, to change the agreed-upon or adopted constructions.”  As to infringement, the Commission agreed with the ALJ’s interpretation and determination that HTC’s accused products contain a device handler.

As to the validity of the ‘263 patent, the Commission agreed with HTC and OUII that the ALJ’s findings constituted legal error.  According to the opinion, in finding that AT&T’s prior art VCOS system did not anticipate the asserted claims, the ALJ appeared to compare the VCOS system to certain prior art central to the ‘263 patent’s prosecution history, essentially assuming that the VCOS system was similar to the prosecution history’s prior art, and if the ‘263 patent were patentable over the prosecution’s prior art, then the ‘263 patent should be patentable over the VCOS system.  However, the Commission found this error rendered moot by the Commission’s revised construction of “realtime API” that required the API itself to operate within a defined upper bounded time limit – a construction under which HTC did not contend the VCOS system anticipates the ‘263 patent’s claims.  Nonetheless, the Commission determined that if “realtime API” were construed as requested by Apple and found by the ALJ, the VCOS system would anticipate the ‘263 patent, because contrary to the ALJ’s findings, the Commission determined the VCOS system indeed would have such a “realtime API” and a claimed “device handler.”

The ‘647 Patent

The ‘647 patent relates to identifying certain “structures” – i.e., names, phone numbers, or email addresses – in a document and then highlighting them on a display so that a user can perform a linked action on the particular structure (for example, dialing a telephone number).  Claim 1 requires “linking actions to the detected structures” while claim 15 requires “linking at least one action to the detected structure.”  The ALJ adopted Apple’s construction of these “linking” phrases, namely: “linking detected structures to computer subroutines that cause the CPU to perform a sequence of operations on the particular structures to which they are linked.” HTC did not challenge this interpretation on review, and the Commission granted review on infringement and invalidity of the ‘647 patent.

The Commission first determined that the ALJ’s invalidity analysis for the ‘647 patent erroneously relied upon the ‘647 patent’s alleged use of the term “structure,” rather than an agreed-upon construction by the parties, namely, “an instance of a pattern, where a ‘pattern refers to data, such as grammar, regular expression, string, etc., used by a pattern analysis unit to recognize information in a document, such as dates, addresses, phone numbers, etc.”  The ALJ determined that the mere search of a database of contact names and subsequent comparison to entered text cannot constitute detecting a “structure,” and at least on that basis determined that a so-called “Perspective” prior art system did not invalidate claims in the ‘647 patent.  The Commission determined that the ALJ’s invalidity analysis was incorrect (1) for not relying upon the construction of “structure” agreed-upon by the parties and used in the ALJ’s infringement analysis, and (2) because the specification and preferred embodiment of the ‘647 patent did not support the ALJ’s narrow interpretation used in the invalidity analysis.  The Commission determined that the prior art “Perspective” system automatically linked contact information to a contact by recognizing that a contact exists and putting the name in bold – and on that basis, the Commission determined that independent claim 15 and its dependent claim 19 were invalid, since each of those claims required only one action.  Claim 1, and its dependent claim 8, however, were determined by the Commission not to be invalidated by the “Perspective” system because claims 1 and 8 require multiple linked actions, and HTC was unable to show that this prior art contained an “analyzer server” for “linking actions to the detected structures,” or a “user interface” for enabling the selection of a “linked action.”

As to infringement of claims 1 and 8, the Commission summarily affirmed the ALJ’s determination for the reasons set forth in the ID.  As to claim 15 (and dependent claim 19), HTC argued that the steps of method 15 must be performed exactly in order, but the Commission determined that the “Perspective” system invalidates claim 15 regardless whether the steps must be performed in the order in which they appear, or whether the enabling section to claim 15’s selection of the structure is one or two steps, and so the Commission deemed these infringement defenses moot, and did not reach them.

After the Commission determined to review the ALJ’s ID, HTC filed a motion for summary determination with the Commission on October 17, 2011, wherein HTC argued that reexamination proceedings concerning the ‘647 patent provided HTC with intervening rights that precluded the issuance of an exclusion order against HTC as to the ‘647 patent.  In an order to show cause why HTC’s motion was procedurally permitted, the Commission observed that Rule 210.18 required filing a motion for summary determination “at least 60 days before the date fixed for any hearing,” and any motion for termination (not involving settlement, consent order, or arbitration agreement) under Rule 210.21(a) must be made “prior to the issuance of an initial determination on violation of Section 337.”  HTC asserted in response that Rule 210.18(a) allows late filing for summary determination under exceptional circumstances when “good cause” exists, and Rule 201.4(b) provides the Commission with authority to waive or suspend a procedural rule when the Commission finds “good and sufficient reason therefore, provided the rule is not a matter of procedure required by law.”  The Commission rejected HTC’s arguments, determining that Rule 210.18(a) specifically cites that the “presiding administrative law judge” (rather than Commission) determines whether good cause exists to permit a tardy motion for summary determination, and Rule 201.4(b)’s authority for the Commission to waive or suspend procedural rules does not “provide a basis for permitting the substantive filing HTC seeks to make.”  The Commission additionally denied intervening rights on the grounds that (1) no reexamination certificate had issued yet, and thus HTC’s argument was premature; (2) the basis for the alleged intervening rights – an Apple statement that the ‘647 patent describes linking an action directly to the detected structure – is not different from the position taken by Apple during the ITC proceedings; and (3) the September 21, 2011 Federal Circuit Marine Polymer Technologies, Inc. v. Hemcon Inc. decision relied upon by HTC was inapposite, since unlike in this proceeding, in Marine Polymer the patentee made arguments and claim withdrawals amounting to narrowed claim scope.

The ‘721 Patent

The ‘721 patent is directed to facilitating object oriented messaging with a procedural operating system, and of the three asserted claims, independent claim 1 recites a method, and dependent claims 5 and 6 add more steps to the method. 

The Commission first addressed the construction of “processing means” – specifically, “first processing means” and “second processing means” included in each of the asserted claims.  ALJ Charneski adopted HTC’s and OUII’s arguments that “processing means” invoked 35 U.S.C. §112 ¶ 6, and the ALJ determined that the method steps of the claims were recited functions of the “processing means” and further agreed with HTC’s identified corresponding structures from the specification.  Before the ALJ, Apple argued that the claims should not be construed under 35 U.S.C. §112 ¶ 6, and before the Commission, Apple argued that if the claims are to be construed under 35 U.S.C. §112 ¶ 6, then the function should be “processing” and that a general purpose computer performs that function.  The Commission disagreed with the ALJ’s construction and agreed instead with Apple’s argument that “processing means” should be construed under 35 U.S.C. §112 ¶ 6, the function should be “processing” and that a general purpose computer performs that function.  The Commission determined that Apple’s construction more closely aligns with the prosecution history and preserves the claims as methods, rather than converting the claims to apparatuses, which was a concern for the Commission under the ALJ’s analysis.

As to validity, HTC argued the ‘721 patent was anticipated by a 1988 Ph.D. thesis by John Bennet (“Bennet”), or in the alternative, rendered obvious by a combination of Bennet and prior art called “Mach messages.”  The ALJ did not address the validity question because of his means-plus-function construction of the “processing means” limitations.  One issue was whether Bennet was “based on an operating system,” as required by the claims, and the Commission determined that Bennet could not anticipate, because HTC had not shown that “the pertinent messages are specific to any particular operating system.”  However, the Commission did find the asserted claims of the ‘721 patent obvious over the combination of Bennet and “Mach messages,” which in turn was operating-system based.  Although Apple pointed to certain compatibility issues between the two systems, the Commission rejected Apple’s arguments, determining instead that Apple had not demonstrated that choosing one protocol over another, “is anything more than a design choice.”  

The Commission also reviewed the construction of “dynamic binding,” which the ALJ had construed by combining aspects of HTC’s and the OUII’s proposed constructions, such that the term was defined as: “permitting messages to be bound to the actual methods to be invoked depending on the class of the receiver, allowing objects of any classes that implement a given method to be substituted for the target object at run time.  Apple proposed a broader definition, and the dispute revolved around whether dynamic binding requires, as set forth in the specification of the ‘721 patent, that the “actual method corresponding to the class of target object does not need to be determined until the message must be sent.”  The Commission agreed with the ALJ’s construction, and determined that the description of dynamic binding used in the specification was definitional, and did not merely describe aspects of a preferred embodiment.  The Commission also determined that the ALJ’s construction was supported by a similar definition of dynamic binding recited in a NeXTSTEP manual, a public document by NeXT, the assignee listed on the face of the patent.

As to infringement of the ‘721 patent, the Commission determined that Apple had waived its infringement claims, because it advanced new infringement theories for the first time on review.  The Commission determined that simply because the ID departed slightly from HTC’s proposed construction does not permit new infringement theories, and that “Apple bore the burden of demonstrating infringement and with it the risk that its theories would not result in infringement under all possible constructions of disputed claim terms.”

The ‘983 Patent

Apple asserted claims 1 and 7 from the ‘983 patent, which involves subject matter similar to the ‘721 patent.

The Commission first reviewed the construction of the term “loading,” which the ALJ had construed after adopting Apple’s contentions, to mean “loading is not limited to physical copying, but includes virtual copying as well.”  The opinion referred to the ID to define “virtual copying” of a method as “a process of putting into executable program memory a pointer to the method’s existence elsewhere.”  HTC argued for a construction that excluded such virtual copying, and on review pointed to the plain meaning of “load” and additionally argued that the ‘983 patent’s prosecution history disclaimed virtual copying.  Although the Commission rejected HTC’s plain meaning argument due to the specification’s use of “copying” to include virtual copying, the Commission agreed that Apple indeed disclaimed “virtual loading” by distinguishing the virtual copying of prior art.  The Commission acknowledged that this construction possibly excludes Apple’s preferred embodiment, but the preference to avoid doing so is not absolute.

The Commission also reviewed the term “selectively load required object-oriented methods.”  The ALJ had rejected Apple’s arguments to construe the term as requiring loading a “class” of methods rather than just the required methods themselves.  The Commission affirmed the ALJ’s construction as supported by the plain meaning of the claims, and the prosecution history of the ‘983 patent. 

As to invalidity, the Commission determined that HTC demonstrated the prior art loaded classes, but did not offer an invalidity analysis under the Commission’s construction of “selectively,” which excludes class loading.  The Commission determined that but for this particular requirement, the claims of the ‘983 patent would be invalid.

With respect to infringement, the Commission determined summarily that HTC’s accused products did not meet the “loading” and “selectively load” limitations construed above.  The Commission additionally determined that HTC’s products did not practice claim limitations calling for “executable program memory.”  Based on the Commission’s prior determination that Apple disclaimed pointing to a method already in executable program memory, the Commissioned determined that the issue is whether the accused products (i) “determine during runtime” if object oriented methods are already in executable program memory, and (ii) whether methods are loaded “into” the executable program memory at runtime as called for by claims 1 and 7.  The Commissione determined that the accused products do not infringe the executable program memory” limitations at least because as found by the ALJ, all methods in the accused devices are loaded into the task address space at startup and are therefore loaded prior to runtime.  The Commission took no position on whether Apple’s domestic industry product practices this claimed limitation.

Remedy

The Commission determined that the appropriate remedy is a limited exclusion order prohibiting the entry of HTC’s personal data and mobile communications devices and related software into the U.S. that infringe claims 1 or 8 of the ‘647 patent.  The Commission also determined that the public interest factors enumerated in Section 337 do not preclude the issuance of the limited exclusion order.  With respect to U.S. consumers, and public health and welfare effects, the Commission rejected many of HTC’s arguments as applying to Android phones generally, rather than just HTC’s Android phones.  The Commission determined that the relief to be granted by the Commission would be directed solely to HTC’s Android smartphones, and ample substitutes exist for these HTC phones.

Notwithstanding the foregoing, the Commission determined that in light of competitive conditions in the U.S. economy, and submissions by T-Mobile that it would have difficulty substituting HTC’s Android smartphones in the short term, the exclusion of HTC devices subject to the order would be delayed for approximately four months, and will commence on April 19, 2012, to provide a transition period for U.S. carriers.  Moreover, the Commission determined that HTC may import refurbished handsets to be provided to consumers as replacements under warranty or an insurance contract (whether the warranty or contract is offered by HTC, a carrier, or by a third party) until December 19, 2013.  The Commission further emphasized that “[t]his exemption does not permit HTC to call new devices ‘refurbished’ and to import them as replacements.”

The Commission agreed with the ALJ’s recommendation that no cease-and-desist order against HTC is needed, citing evidence that “HTC surrenders all title and interest to its commercial products when they arrive and are warehoused in the United States.”  The Commission further agreed that Apple failed to satisfy its burden that a bond is required during the Presidential review period, in view of evidence “that the HTC and Apple products are similarly priced (before carrier subsidies).”

Commissioner Pinkert concurred with his colleagues as to the appropriate remedy, but wrote separately to express his additional views.  In this respect, Commissioner Pinkert “emphasize[d] that the existence of substitutes for the infringing devices does not obviate consideration of the likely impact of exclusion on the range of choices available to consumers.”  Commissioner Pinkert added: “Such impact may warrant more searching inquiry in other investigations.”

By way of background, this investigation is based on a July 12, 2011 complaint filed on behalf of Intellectual Ventures Management, LLC, Invention Investment Fund I, L.P., Invention Investment Fund II, LLC, Intellectual Ventures I LLC, and Intellectual Ventures II LLC, against several manufacturers, distributors, and retailers of DRAM and NAND Flash memory devices by Hynix Semiconductor Inc. and Hynix Semiconductor America, Inc. and Elpida Memory, Inc. and Elpida Memory (USA) Inc., for alleged infringement of U.S. Patent Nos. 5,654,932; 5,963,481; 5,982,696; 5,500,819; and 5,687,132.  See our July 13, 2011 post for more details.

As an initial matter, ALJ Gildea ordered Complainants to re-file revised public versions of all three settlement agreements because two were so heavily redacted that the requirement to file non-confidential versions was rendered “meaningless,” and the third agreement was not submitted at all.  ALJ Gildea stated that Complainants may only redact “the minimum required to protect confidential business information, even if that means only redacting single words or portions of a sentence.”

ALJ Gildea set the hearing so that “the parties, and any interested non-parties, may provide argument and relevant evidence regarding the effect of the proposed settlement on the public health and welfare, competitive conditions in the U.S. economy, the production of like or directly competitive articles in the United States, and U.S. consumers.”  ALJ Gildea further determined that the parties or interested non-parties were permitted to submit pre-hearing briefs of no more than twenty-five pages, and that the procedures for this hearing on the public interest would be modeled after the procedures set forth in the Ground Rules for an evidentiary hearing.  ALJ Gildea further determined that nonparties who wished to participate in the hearing, and who had argument or evidence relevant to this specific settlement, should contact the ALJ’s assistant, but that since many of the settlement terms are not public, any nonparty’s input on the public interest would be limited.

The investigation is based on a November 4, 2011, complaint filed by VirnetX, Inc., of Zephyr Cove, Nevada alleging violation of Section 337 in the importation into the U.S. and sale of certain devices with secure communications capabilities, components thereof, and products containing the same, and cameras that infringe one or more claims of U.S. Patent No. 8,051,181.  See our November 8, 2011 post for more details.

According to the Notice of Investigation, the ITC has identified Apple, Inc. of Cupertino, California as the respondent in this investigation.

Further, Chief ALJ Charles E. Bullock issued a notice indicating that ALJ David P. Shaw will be the presiding Administrative Law Judge in this investigation.

The investigation is based on a November 1, 2011 complaint filed by ChriMar Systems, Inc. d/b/a CMS Technologies of Farmington Hills, Michigan alleging violation of Section 337 in the importation into the U.S. and sale of certain communication equipment, components thereof, and products containing same, including power over Ethernet telephones, switches, wireless access points, routers and other devices used in WLANs, and cameras that are compliant with the IEEE 802.3af and/or IEEE 802.3at amendments to the IEEE 802.3 standard and that infringe one or more claims of U.S. Patent No. 7,457,250.  See our November 3, 2011 post for more details.

According to the Notice of Investigation, the ITC has identified the following entities as the respondents in this investigation:

• Cisco Systems, Inc. of San Jose, California
• Cisco Consumer Products LLC of Irvine, California
• Cisco Systems International B.V. of the Netherlands
• Cisco-Linksys LLC of Irvine, California
• Hewlett-Packard Co. of Palo Alto, California
• 3Com Corporation of Marlborough, Massachusetts
• Avaya Inc. of Basking Ridge, New Jersey
• Extreme Networks, Inc. of Santa Clara, California

Further, Chief ALJ Charles E. Bullock issued a notice indicating that ALJ Theodore R. Essex will be the presiding Administrative Law Judge in this investigation. 

According to the press release:

David S. Johanson, a Republican of Texas, was sworn in today as a Commissioner of the U.S. International Trade Commission. He was confirmed by the U.S. Senate on October 31, 2011, for the term expiring on December 16, 2018.

Commissioner Johanson served as International Trade Counsel on the Republican staff of the Committee on Finance of the U.S. Senate from 2003 until his appointment. Prior to his employment at the Committee on Finance, he practiced international trade law for six years at the law firm of Stewart and Stewart in Washington, D.C. Earlier in his career, Commissioner Johanson worked for Senator Phil Gramm (R-TX), Representative Wally Herger (R-CA), and Representative George Radanovich (R-CA).

Commissioner Johanson holds a Bachelor of Arts degree from Stanford University, a Master of Philosophy degree from Cambridge University, and a Juris Doctor degree from the University of Texas School of Law.

The U.S. International Trade Commission is an independent, nonpartisan, factfinding federal agency that provides trade expertise to both the legislative and executive branches of government, determines the impact of imports on U.S. industries, and directs actions against certain unfair trade practices, such as patent, trademark, and copyright infringement.

The complaint alleges that Analog Devices Inc. of Norwood, Massachusetts (“ADI”), Amkor Technology, Inc. of Chandler, Arizona (“Amkor”), and Avnet, Inc. of Phoenix, Arizona (“Avnet”) unlawfully import into the U.S., sell for importation, and/or sell within the U.S. after importation certain silicon microphone packages and products containing the same that infringe, or that are made by a process that infringes, one or more claims of U.S. Patent Nos. 7,439,616 (the ‘616 patent) and 8,018,049 (the ‘049 patent) (collectively, the “asserted patents”).

According to the complaint, the asserted patents generally relate to silicon microphone package technology.  In particular, the ‘616 patent relates to a package that contains a silicon microphone die.  The ‘049 patent relates to a package that contains a silicon microphone die and a method for manufacturing the package.

In the complaint, Knowles states that ADI, Amkor, and Avnet import and sell products that infringe the asserted patents.  The complaint specifically names a number of ADI silicon microphones and evaluation boards containing silicon microphones as infringing products.  According to the complaint, Amkor manufactures these ADI products pursuant to ADI’s specifications and requirements and provides them to ADI and Avnet, among others.

Regarding domestic industry, Knowles states that it practices the asserted patents in the U.S. through its manufacture, research and development, and application support for its SiSonic MEMS silicon microphone packages.  According to the complaint, Knowles’s domestic facility includes salaried research and design engineers, salaried administrative employees, tens of millions of dollars’ worth of equipment, and other assets allowing for the research, development, production, and sales of its acoustic products.

As to related litigation, Knowles states that on November 14, 2006, it filed a complaint against various entities and individuals in the U.S. District Court for the Northern District of Illinois alleging misappropriation of trade secrets related to silicon microphones.  Knowles states that the resulting action was settled by the parties and dismissed with prejudice.  Additionally, Knowles states that on December 13, 2006, it filed a complaint against Akustica, Inc. in the U.S. District Court for the Eastern District of Texas, alleging infringement of U.S. Patent No. 6,781,231 (the ‘231 patent).  Knowles states that this action was settled by the parties and dismissed without prejudice.  Knowles further states that on October 6, 2009, it filed a complaint against ADI in the U.S. District Court for the Northern District of Illinois, alleging infringement of the ‘231 patent and U.S. Patent No. 7,242,089 (the ‘089 patent).  Knowles states that this action was voluntarily dismissed without prejudice on October 5, 2011.  However, Knowles states that on September 27, 2011, it filed another complaint against ADI in the U.S. District Court for the Northern District of Illinois alleging infringement of U.S. Patent No. 7,537,964 and the ‘049 patent.  Knowles also refers to Inv. No. 337-TA-629 at the ITC, where it accused MEMS Technology Berhad (“MemsTech”) of violating Section 337 through its alleged infringement of the ‘231 and ‘089 patents.  See our October 31, 2011 post for more details.  Please note that Oblon Spivak represents MemsTech in the 629 investigation.  Knowles further refers to Inv. No. 337-TA-695, where it accused ADI of violating Section 337 through its alleged infringement of the ‘231 and ‘089 patents.  See our January 3, 2011 post for more details.  Lastly, Knowles refers to various inter partes and ex parte reexaminations of the ‘231, ‘089, and ‘616 patents.

With respect to potential remedy, Knowles requests that the Commission issue a permanent limited exclusion order and a permanent cease and desist order directed at ADI, Amkor, Avnet, and related companies.

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 portable communication devices that infringe one or more claims of U.S. Patent Nos. 5,926,636 (the ‘636 patent), 5,929,655 (the ‘655 patent), 6,208,879 (the ‘879 patent), and 6,456,841 (the ‘841 patent) (collectively, the “asserted patents”):

• Research In Motion Ltd. of Canada
• Research In Motion Corp. of Irving, Texas
• HTC Corporation of Taiwan
• HTC America, Inc. of Bellevue, Washington
• LG Electronics, Inc. of South Korea
• LG Electronics U.S.A., Inc. of Englewood Cliffs, New Jersey
• LG Electronics MobileComm U.S.A., Inc. of San Diego, California
• Motorola Mobility Holdings, Inc. of Libertyville, Illinois
• Samsung Electronics Co., Ltd. of South Korea
• Samsung Electronics America, Inc. of Ridgefield Park, New Jersey
• Samsung Telecommunications America, LLC of Richardson, Texas
• Sony Corporation of Japan
• Sony Corporation of America of New York, New York
• Sony Electronics, Inc. of San Diego, California
• Sony Ericsson Mobile Communications AB of Sweden
• Sony Ericsson Mobile Communications (USA) Inc. of Research Triangle Park, North Carolina
• Amazon.com, Inc. of Seattle, Washington
• Nokia Corporation of Finland
• Nokia Inc. of Irving, Texas

According to the complaint, the asserted patents generally relate to portable communication technology.  In particular, the ‘636 patent relates to a remote procedural call component management method for a heterogeneous computer network.  The ‘655 patent relates to methods and apparatuses for providing dual-purpose I/O circuits, wherein each of the dual-purpose I/O circuits can be configured to support either one, or both, single-ended and differential I/O signaling modes.  The ‘879 patent relates to a mobile information terminal that has more than one mode, such as a telephone mode and an information terminal mode.  Lastly, the ‘841 patent relates to a mobile communication apparatus capable of notifying a user of the presence of unopened message information, such as a text message or voice mail.

In the complaint, Digitude states that the Proposed Respondents import and sell products that infringe the asserted patents.  The complaint specifically identifies a number of allegedly infringing products associated with the various Proposed Respondents.

Regarding domestic industry, Digitude states that it maintains a domestic industry through the activities of a domestic licensee.  According to the complaint, the domestic licensee practices at least one claim of each of the asserted patents in the U.S.  The details of the domestic licensee’s activities are provided in Confidential Exhibits and are not discussed in the body of the complaint.

With respect to potential remedy, Digitude requests that the Commission issue a limited exclusion order and a cease and desist order directed at the Proposed Respondents.

In the Order, ALJ Rogers granted a joint motion filed by Complainant Technology Properties Limited LLC (“TPL”) and Respondent Circus World Displays Ltd. (“CWD”) to terminate the investigation based on a settlement agreement.  After reviewing the confidential and non-confidential versions of the agreement, ALJ Rogers granted the joint motion filed by TPL and CWD.

The Investigation remains pending against several other Respondents.

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 kinesiotherapy devices and components thereof that infringe one or more claims of U.S. Patent Nos. 7,931,605 (the ‘605 patent) and D605,779 (the ‘779 patent):

• LELO Inc. of San Jose, California
• LELOi AB of Sweden
• LELO of China
• Natural Contours Europe of The Netherlands
• Momentum Management, LLC a.k.a Bushman Products of Torrance, California
• Evolved Novelties of Canoga Park, California
• Nalpac Enterprises, Ltd. d/b/a Nalpac, Ltd. of Ferndale, Michigan
• E.T.C., Inc. d/b/a Eldorado Trading Company, Inc. of Broomfield, Colorado
• Williams Trading Co., Inc. of Pennsauken, New Jersey
• Honey’s Place, Inc. of San Fernando, California
• Lover’s Lane & Co. of Plymouth, Michigan
• PHE, Inc. d/b/a Adam & Eve of Hillsborough, North Carolina
• Castle Megastore Group, Inc. of Tempe, Arizona
• Shamrock 51 Management Company, Inc. d/b/a Fairvilla.com of Maitland, Florida
• Paris Intimates, LLC of West Bloomfield, Michigan
• Drugstore.com, Inc. of Bellevue, Washington
• Peekay Inc. of Auburn, Washington
• Mile Inc. d/b/a Lion’s Den Adult of Worthington, Ohio
• Marsoner, Inc. d/b/a Fascinations of Chandler, Arizona
• Love Boutique-Vista, LLC d/b/a Déjà vu of Vista, California
• Toys in Babeland LLC of Seattle, Washington

 According to the complaint, the ‘605 patent is directed to “a sexual stimulation device worn by a woman during intercourse that includes an arm dimensioned for placement inside a vagina and an arm dimensioned for placement against a clitoral area.” The device has arms tapering down toward a connecting portion that connects the two arms, and at least one of the arms has a tear-drop shape.  The patent is also directed to the construction of the asserted devices, which include vibrators.  The ‘779 patent is a design patent directed to the ornamental design for a vibrator.

The complaint defines LELO Inc., LELOi AB, LELO, Natural Contours Europe, Momentum Management, and Evolved Novelties as “Manufacturer Respondents,” who manufacture, design, sell for importation, import, and/or sell after importation infringing kinesiotherapy devices and components thereof that use Standard Innovation’s patented technologies.  The complaint further defines Nalpac Enterprises, Ltd., E.T.C., Inc., Williams Trading Co., Inc., and Honey’s Place, Inc. as “Distributor Respondents,” who import, and/or sell after importation infringing kinesiotherapy devices and components thereof.  The remaining respondents are defined as “Retail Respondents,” who import, and/or sell after importation infringing kinesiotherapy devices and components thereof.  The complaint specifically identifies a number of allegedly infringing products associated with the various Proposed Respondents.

As to related litigation, the complaint states that Standard Innovation is contemporaneously filing a complaint in the U.S. District Court for the Southern District of Texas asserting infringement of the ‘605 patent against LELOi AB, LELO Inc., and LELO.

Regarding the technical prong of the domestic industry requirement, Standard Innovation asserts that its We-Vibe ® family of products (We-Vibe, We-Vibe II and We-Vibe 3) practices the ‘605 and ‘779 patents.  As to the economic prong, Standard Innovation points to millions of dollars in U.S. sales of We-Vibe ® products, its U.S. supply contracts, research and development activities in the U.S., warehousing of products in the U.S., employees in the U.S., and educational training, seminars, distribution, administrative activities, marketing, its U.S. webstore (accessible only in the U.S.), and its regular participation in U.S. tradeshows.

With respect to potential remedy, the complaint requests the Commission to issue a general exclusion order, in view of alleged widespread patterns of infringement by numerous unknown entities and from numerous origins, the ease of manufacturing infringing kinesiotherapy devices, and the likely ease with which new companies and brands would replace domestic companies affected by a limited exclusion order.  In the alternative, the complaint requests a limited exclusion order.  The complaint further requests a permanent exclusion order forbidding entry into the U.S. of infringing kinesiotherapy devices, and permanent cease and desist orders directed at the Proposed Respondents, their affiliates, and others acting on their behalf.