Q & A with...

Q&A With Miller & Chevalier's Dave Foster

By Eric Schweibenz
|
Sep
03
Dave Foster, a member of the law firm of Miller & Chevalier, recently shared his insights concerning Section 337 practice at the ITC with the ITC 337 Law Blog.  Dave practices in Miller & Chevalier’s International Trade Department.  From 1973 to 1977, Dave served in the General Counsel’s office and the Chairman’s office of the U.S. International Trade Commission (“ITC”).  From 1977-1981, he served as the International Trade Counsel for the U.S. Senate Finance Committee.  For the last twenty-eight years, Dave has been in private practice, principally representing both U.S. and foreign-based companies in Section 337 cases.  He was involved at the ITC with the rewriting of Section 337 into its current form in the Trade Act of 1974, chaired the ITC committee that prepared the initial implementing regulations, oversaw the statute while on the Finance Committee Staff, and has represented parties in over 60 Section 337 cases while in private practice.   Dave spoke recently to ITC 337 Law Blog. What are some of the most significant changes to Section 337 practice since you started in private practice?  In terms of the practice, the annual number of cases being litigated under Section 337 has tripled or quadrupled, and the number of lawyers and firms participating has risen even more substantially.  The type of case being litigated has also changed, from initially cases mostly involving low-tech products to now cases mostly involving advanced technology products.  The number of foreign-based firms bringing cases has also grown substantially, as the domestic industry requirement has become easier to satisfy.  The target of the cases in terms of the country of the respondents have also changed, progressing from Japan to Taiwan to China, with some upturn in Korean cases also over the last decade.  Finally, the commitment of the ITC to supporting the implementation of Section 337, which has always been there, in recent years has increased even more, particularly in terms of the number of ALJs and staff devoted to implementing the statute. What are some of the advantages of commencing a Section 337 investigation versus a district court action? The advantages of Section 337 over a district court action can be numerous.  First, there is speed to decision.  Section 337 offers the only consistently rapid IP docket in the United States, typically with a final decision in 13-16 months (and an initial determination (“ID”) by the ALJ in 9-12 months), as district court “rocket dockets” often have been a victim of their own success, e.g., the Eastern District of Texas.  Secondly, there are few jurisdictional issues in a Section 337 case; if there is an import, there is jurisdiction.  This avoids the often time consuming and expensive jurisdictional and venue issues encountered in district court.  Third, the usual, statutorily provided remedy under Section 337 is an exclusion order, enforced by the U.S. Customs and Border Protection Agency within DHS, so e-Bay considerations relating to issuance of injunctions, and the necessity of contempt proceedings to enforce an order, do not play a role in Section 337 cases.  Fourth, there are no effective counterclaims in Section 337 cases; while counterclaims are permitted, they are removed to a district court and typically will not be decided, if at all, until well after a Section 337 case is finished.  Indeed, in a Section 337 action, it is usually the case that the Complainant typically puts the respondents at risk of losing 3 times (the ALJ’s ID, the Commissions’ final determination, and CAFC review) before any district court action by a respondent will be decided that may put Complainant at risk.  There are other advantages, such as a judge’s corp second to none in the IP area, but the ones I just mentioned are plainly significant ones. To what do you attribute the steady increase in Section 337 filings at the ITC? The steady increase in my view has been driven by the few rocket dockets in district courts slowing down as previously noted; by foreign-based companies bringing more complaints, avoiding the issues raised by being in front of a U.S. jury and gaining the advantage of being in front of experienced IP judges, as well as benefiting from the other advantages mentioned earlier; the e-Bay decision, which makes Section 337 more attractive in terms of securing an exclusive order versus receiving injunctive relief in the district courts; the expansion of activities which satisfy the domestic industry requirement of Section 337 making it easier to satisfy that requirement; and in general, increasing awareness among companies and their counsel of the benefits of Section 337 compared to the district court. Do you envision more foreign-based companies bringing Section 337 complaints over the coming years? Yes, I do.  Interestingly, several foreign-based companies have actually told us that they are tired of being targets of Section 337, and want to take advantage of it as Complainants.  Especially with the satisfaction of the domestic industry requirement of the statute becoming easier, foreign-based companies are increasingly making consideration of a Section 337 action one of their routine tactical options for defending their U.S. intellectual property. Do you envision more non-practicing patent owners (e.g., patent trolls) bringing Section 337 complaints over the coming years? I think NPE’s will increase their use of Section 337.  The speed of Section 337 cases and hence the avoidance of protracted, expensive litigation which can strain resources, and the avoidance of juries and e-Bay make Section 337 particularly attractive to NPEs.  If there is one thing that you want our readers to know about the ITC and/or Section 337 practice, what is it? Probably the aspect of Section 337 which gives practitioners the most problem is one of its principal advantages -- speed to decision.  Because of the pace it is critical to know Section 337 practice and manage the case well from the start, which means putting together the best team you can from available resources, including firms other than your own, and preparing for trial from day one.  I cannot tell you how many times cases are affected, even to the point of losing, because time was not well-managed and decisions were made that reflected a lack of appreciation for the differences between Section 337 cases and district court cases, and the strategical and tactical differences resulting therefrom.
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Q & A With Lou Mastriani of Adduci Mastriani & Schaumberg

By Eric Schweibenz
|
Mar
10
Lou Mastriani is a founding partner of Adduci Mastriani & Schaumberg, LLP, an international trade law firm based in Washington, DC with one of the largest and top-ranked Section 337 practices in the United States.  For nearly thirty years, Lou has been in private practice representing both U.S. and foreign-based companies in connection with international trade regulation issues.  Lou has participated in nearly 80 Section 337 cases before the ITC. In addition to litigating Section 337 investigations and disputes in federal district court, Lou has handled a number of antidumping and countervailing duty cases and has argued cases before the Court of International Trade and the U.S. Court of Appeals for the Federal Circuit.  He also was appointed by the U.S. Trade Representative to serve as both a panelist and chairman on bi-national panels convened pursuant to the North American Free Trade Agreement. Prior to entering private practice in 1981, Lou served as legal counsel to an ITC Commissioner before becoming an investigative attorney in the Office of Legal Services (currently known as the Office of Unfair Import Investigations).  As an ITC investigative attorney, Lou also assisted in revising and drafting the Commission’s Rules of Practice and Procedure with respect to Section 337 investigations. Lou spoke recently to ITC 337 Law Blog. What types of companies typically bring Section 337 complaints at the ITC? There have been over 700 cases that have been filed in recent years under this statute by companies that span the spectrum from high tech to industrial products to consumer products.  These also include foreign companies that own U.S. intellectual property which have operations in the U.S. and are therefore eligible to use the statute.  The products involved in these cases run the gamut from Rubik's Cube, the X-Box, and Post-it Notes, to Viagra, other pharmaceuticals and every type of semiconductor device.  What these companies share in common is the recognition that the ITC has become the most effective and efficient forum that is available to owners of U.S. intellectual property to resolve violations of these rights.  Many sophisticated companies such as Intel, 3M, Microsoft and others frequently seek relief at the ITC against these imported infringing products in large part because of the agency's expertise with intellectual property disputes, and the fast track set for these cases.  Individual inventors and entrepreneurs have also availed themselves of the ITC.  Within the past several years, and especially after the eBay decision by the Supreme Court, there has been a significant increase in the number of licensing companies, so called non-practicing entities, that have filed complaints at the ITC. Do you envision more foreign-based companies bringing Section 337 complaints in the future? The amendments to the statute in 1988 that removed the injury requirement for federally recognized intellectual property rights violations, and, furthermore, substantially relaxed the domestic industry requirement for such cases made it easier for non-U.S.-based entities to take advantage of the Section 337.  Statistically speaking, there has been a dramatic increase in the number of non-U.S.-based complainants filed in recent years.  During the period 2000-2009, non-U.S.-based complainants increased their share from zero to a high of 35%.  This trend will certainly continue. Are Section 337 investigations more or less expensive to litigate than district court actions? In my experience, Section 337 cases are less expensive overall than a district court to litigate an intellectual property infringement claim.  There are no Hague Convention requirements for service of the complaint and taking of evidence in foreign countries, and the ITC has nationwide subpoena power.  Likewise, motions practice is more reduced and controlled than in district court actions.  One very significant advantage is that Section 337 investigations are completed in far less time than a district court action, which are frequently interminably long with respect to resolutions of dispositive motions, getting to trial, and resolving post-trial motions.  However, the rapidity of ITC cases translates into the costs of prosecuting or defending the case being incurred in this highly compressed schedule.  Nonetheless, the swift resolution of the dispute results in significant benefits to the business and positions of the winning parties. How long does it take to complete a typical Section 337 investigation? From institution of the complaint to issuance of the exclusion order, Section 337 investigations usually run about 18 months, which is half the time of the typical district court litigation.  The parties are in trial within 8-9 months, with an Initial Determination issued by the Administrative Law Judge within 11-12 months, and a Final Determination by the Commission within 15-16 months. What is the Office of Unfair Import Investigations (OUII) and how does the role of this office change as a Section 337 investigation proceeds? The Office of Unfair Import Investigations plays a vital role both in the pre- and post-initiation stages of a Section 337 proceeding.  Before a complaint is filed with the Commission, it is typical for the prospective complainant to confer with OUII to ensure that the complaint will be properly filed.  Once a Section 337 investigation has been instituted, OUII becomes a neutral third party whose primary purpose is to protect the public interest throughout the proceedings.  OUII participates as a full and active party to the proceeding and can initiate discovery, file motions, respond to motions by the other parties, and examine witnesses at depositions and the hearing.  OUII will take a formal position on the merits of the case in its pre-hearing and post-hearing briefs.  It should be noted that the pre-institution reviewing OUII attorney is typically not assigned to the case after institution to avoid any appearance of prejudice. What impact have you seen to Section 337 practice since the Federal Circuit’s 2008 Kyoceradecision? Post-Kyocera, we are seeing more respondents involved in each investigation since 337 complainants now are required to name all the producers and suppliers of downstream products whose products they might want to bar from importation.  These additional respondents are typically product manufacturers, service providers and retailers.  My partner, Tom Schaumberg is actively working with the ITC Trial Lawyers Association on post-Kyocera legislation. Some of the recently appointed ALJs appear to favor Markman hearings.  Do you think this trend will continue, and, if so, how will it affect Section 337 practice? Some of the recently appointed ALJs have held Markman hearings, and ALJ Bullock has also held them, as well.  These ALJs do not always hold Markman hearings, but generally do so when the parties agree that it would be beneficial to do so.  Chief ALJ Luckern has never held a Markman hearing, although he recently stated that he is not opposed to holding them if the circumstances warrant it.  For this reason, Markman hearings are the exception and not the norm. Why do patent infringement cases comprise the vast majority of Section 337 investigations? Patent suits have become part of the licensing negotiation process.   Many complainants litigate as a standard negotiating tool when seeking licensing arrangements with the defendant, and defendants often countersue for the same reason.  The extensive use of lawsuits as part of the negotiation process is particularly pronounced in patent law.   Section 337, because it is such a rapid process, can be a particularly useful and high-pressure tool for companies involved in such negotiations (district court actions, in contrast, proceed glacially and may exert less pressure on the parties to negotiate).  The fact that many patent-based 337 cases settle out with licensing agreements is testament to this aspect of 337 patent litigation.  Additionally, awareness of the statute outside of the patent bar is negligible.  Section 337 is known as a patent statute, even though its older provisions are much broader and encompass a broad array of unfair acts, such as trade secret misappropriation and antitrust violations.  Finally, the statute's patent provisions are equally useful to U.S.-based and non-U.S. based companies.  Complainants at the ITC in patent-based cases are almost as likely to be foreign-based as they are to be U.S.-based.  In a sense, the ITC has become a global forum for patent adjudication, due to the importance of the U.S. market for companies around the world.  It is not unusual for both the complainant and the respondent in ITC investigations to be foreign-based -- and sometimes even to be located in the same foreign country. Do you envision Section 337 filings at the ITC increasing in the future? Use of Section 337 has risen sharply in recent years for the following reasons.  1) The remedy that's available through the ITC is unique.  It authorizes the Commission to actually exclude all infringing products, all copies, from entering the United States market.  It also prohibits the sale of those products that have already come into the United States market.  2) The other factor that's important is the speed with which these cases move through the ITC.  Unlike a patent infringement case in Federal District Court, for instance, which can take several years, the average ITC case is completed within 18 months. If there is one thing that you want our readers to know about the ITC and/or Section 337 practice, what is it? The ITC exclusion order is the most effective weapon for protecting your intellectual property rights, and the corollary for resolving unfounded claims of intellectual property right infringement.  I would also note for those who are interested that, the American Bar Association is now offering a book entitled, “A Lawyer’s Guide to Section 337 Investigations Before the U.S. International Trade Commission.”  Click here to view link.
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Q & A With Administrative Law Judge Theodore R. Essex

By Eric Schweibenz
|
Jun
04
ALJ Theodore R. Essex spoke recently to ITC 337 Law Blog.  The answers he has provided here are strictly his own, and do not represent the position of the ITC or any other member of it. What interested you in becoming an ALJ at the ITC? There were two factors that interested me in coming to the ITC, the first being geographical.  Having said that, when I saw the opening for a judge at the ITC, I studied the agency, reading its website, including the section on 337, the Commission rules, the CFR sections that applied to the ITC, and it was very clear that the work here was challenging at a number of levels.  I was impressed with the type of hearings that the ITC conducted, and with the length and complexity of the IDs that were produced.  I thought at the time that the work would be interesting and challenging, and so it has been. How did your prior military experience prepare you for your current job as an ALJ at the ITC? In my career with the USAF, I worked in a number of fields and areas of law that I believe were superb training for the ITC.  I spent many years as a trial attorney, as a defense and prosecuting attorney in criminal law, worked in international law, and finally tort law.  As a trial attorney, I learned to study cases and know them well, from complex medical issues, to detailed factual determinations.  I spent three years as the chief accident investigator for Air Education and Training Command, studying in detail the systems and human factors in aircraft mishaps.  In each investigation, there are a number of scientific details to study, broken down by systems.  In international law, I worked on the training for the INF Treaty and negotiated SOFA [Status of Forces Agreements] supplements, which involved complex and highly detailed reports and products.   So on a whole, my career involved learning complex and detailed subject areas, and working with evidence and witnesses to produce coherent reports.  I think it was great training for this job. What is a typical work day like for you as an ALJ at the ITC? Obviously the days are very different when we are in hearing, but when we are not, the bulk of the time is spent reading the information submitted by counsel, and trying to get orders out the door.  The attorneys that practice in the ITC are prolific, and there is no shortage of filings to get through. Generally, do you have any practice pointers for attorneys who appear before you at the ITC?  More specifically, are there things you wish lawyers did differently, particularly with respect to presenting sometimes complex technological issues? I hope I have been clear in getting practice pointers out in other forums, but I am happy to repeat the basics here.  Remember that you have only your reputation and integrity as an attorney to fall back on.  Treat everyone, including witnesses, with respect, unless and until you have proven they do not deserve it.  Be clear and honest in all you do.   One of the most important things that firms and attorneys can do in practicing before the ITC is remember the speed at which we function, and cooperate in getting things done, particularly in discovery.  While there are often legitimate issues that should be brought to the judge, it is frustrating when it appears the parties are unable to work out matters that ought to be worked out with cooperation. The attorneys that appear in our court are doing a very good job, and I would not presume to tell them how to do things differently.  With regard to the complex technological matters, the attorneys and experts are doing fine, and I don’t know how they could do it differently in most cases.  I think long term we ought to look at a couple of factors.  First, I think we do spend a great deal of time on issues about which there is no real dispute.  Often I will see evidence on matters such as domestic industry, or importation where the actual crucial point of the case is elsewhere.  I would like to see if we can focus more on the disputed matters and do less on issues that will not impact the decision. What do you enjoy most about being an ALJ at the ITC? I think the fact that every case has new information, technology and challenges makes it fresh everyday.  I enjoy the people here, and the fact the companies and attorneys are on the cutting edge of industry and law.  I recall in one of my first cases listening to the experts, and thinking how much the education I was getting there would have cost if I had tried to go find it in the market.  I had some of the world’s leading professors and scientists in court to explain the technology to me, and to underline the disputes.  I find that exciting and enjoyable.  Finally, the ITC trial bar is a relatively small community, and I have enjoyed meeting the members at the functions very much. Can you generally describe the professional interaction among the ALJs at the ITC? When I arrived here the judges welcomed me warmly, and have helped me very much in finding my feet and learning what I needed to know.   While each judge maintains his independence in decision making, I have found all of them willing to discuss cases and law as questions arise, though we are all relatively active with our own case loads. How does your current ALJ position at the ITC differ from your prior ALJ position at the Office of Medicare Hearings and Appeals? Here at the ITC we have far fewer cases, but the complexity of the cases, and the volume of material in each is very high; often exhibits will number in the hundreds and pages in the hundreds of thousands or more.  All the litigants are represented by counsel of the highest caliber, and each side is well represented.  At OMHA, we usually had pro se appellants, and frequently there was only one party in the appeal.  While the cases were less complex, the volume of cases was much higher, and the appellant had a personal stake in the outcome.  Often the first individual that would actually sit in front of them and listen was the ALJ, and the hearing was important to them personally. You have dedicated your legal career to public service.  For those lawyers who have not worked in the public sector, could you comment on how you see the role of attorneys who work for government entities? I have been very fortunate in the career positions I have had.  In the military I had a great sense of purpose, as I was able to work with and help the service members who were dedicated to protecting the country and its allies.  I enjoyed working with the men and women in the armed forces very much, and some of the things we accomplished still impress me to this day.  In addition to the service I was able to give to the individuals, working in the government is a trust, and each public servant should try to conduct him or herself with an awareness of that.  I take great pride in some of the things we were able to do over the years for both the US and individuals.  Attorneys that work for the government have an opportunity to do work that impacts society as a whole, and to feel that they are doing something that will help others. What is the most memorable moment that has occurred at an evidentiary hearing that you presided over (you can be generic if you want to protect identities of the parties involved!)? So many of the moments were memorable at the time, and have faded it is hard to say.  I recall in one case we had a Lexus with an anti-collision system that CARFAX had reported as having been in three collisions.  I thought the system wasn’t working very well. If there is one thing that you want our readers to know about the ITC, what is it? I think it is a terrific place to be right now.  We have been getting some of the most interesting cases in the country, we have great people and I think from the Commissioners to the Staff it is a wonderful place to work.  Right now we are on track for another record number of cases, and we are getting the resources to handle the case load.  I think this is as exciting a place to practice law as there is in the country right now.
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Q & A With T. Spence Chubb of WilmerHale

By Eric Schweibenz
|
Aug
27
T. Spence Chubb is a Special Counsel with the law firm of WilmerHale in Washington, D.C.  Spence joined the firm in 2010 after leaving his long-time post at the U.S. International Trade Commission.  From 1989 to 2010, Spence served as a Supervisory Attorney in the Office of Unfair Import Investigations (“OUII”) at the ITC, where he handled litigation involving  patent, trademark, trade secret, and unfair competition claims under Section 337 of the Tariff Act of 1930 and supervised Commission investigative attorneys.  Spence served as a Commission Investigative Attorney from 1986 to 1989.  During his time with the ITC, Spence participated in more than 85 trials and 186 cases. Spence spoke recently to ITC 337 Law Blog. What are some of the most significant changes to Section 337 practice since you started as an ITC attorney in the 1980s? Your question is a challenge because so many changes have taken place that it is almost easier to think about what’s still the same.  Certainly some of the biggest changes from when I first appeared before the Commission while I was in private practice in 1984 and then started working at the Commission in 1986 stem from the elimination of the injury requirement for statutory intellectual property cases. (As everyone familiar with Section 337 practice knows, “statutory IP cases” means for the most part patent infringement cases.)  What occurred subsequently was a sea change in the number and mix of cases being brought under Section 337.  Ironically, despite the fact that the Omnibus Trade and Competitiveness Act changes of 1988 were primarily meant to make Section 337 an easier forum for the use of companies with patent-based complaints while keeping the statute basically the same for complainants with non-statutory-based complaints, the level of utilization of the statute by patent-based  complainants remained basically unchanged while the number of non-patent-based cases dropped off significantly.  Overall, this reduced the numbers of new complaints being brought every year from the 30s and 40s prior to the 1988 Act to the low to mid-teens for most years for the rest of the 1980s and throughout the 1990s.  On the other hand, the caseload became more and more dominated by high tech, high stakes technologies.  For example, I recall that around the time I started at the ITC, cases involving semiconductor chips would trickle in at about one a year.  Before too long integrated circuit cases had become one of the most popular, if not the most popular, types of cases that were being brought. In addition to the increasingly sophisticated technology at issue in the cases and their increasing stakes, Section 337 litigation like all complex litigation was undergoing the transition to the world of email and the internet, electronic discovery, the use of cell phones and remote computer access, and the use of more expensive and intricate graphics in trials. So, basically, Section 337 practice has evolved from an area that tended to be concentrated on low-tech, inexpensive imports to a practice that focuses on sophisticated and complex technologies and cutting edge legal issues. What is the purpose of the Office of Unfair Import Investigations (OUII)? The Trade Act of 1974 made many fundamental changes to Section 337 and to the U.S. International Trade Commission in general (including changing the name from the U.S. Tariff Commission).  Perhaps the most significant was requiring that Section 337 cases be conducted as full due process, adversarial proceedings under the formal adjudication provisions of the Administrative Procedure Act.  As I understand it, in making the necessary rule changes to adjust to the new procedures, the Commission determined that assigning an attorney in its employ to represent the public interest would help to insure that public interest issues would not get lost sight of in the conduct of these newly adversarial inter partes proceedings.  The original group of these public interest attorneys was a part of the ITC General Counsel’s office, but it was soon realized that such an arrangement was unworkable if the public interest attorney was to be a full party to the case with the same restrictions on ex parte contacts with decisionmakers (i.e., the Administrative Law Judges and the Commission and their legal advisors) as the private parties.  Accordingly, the division that became OUII was spun off as a separate office under the ITC’s Director of Operations rather than under the General Counsel. It is the practice of OUII to designate one (or occasionally two) of its attorneys to represent the public interest in every single Section 337 investigation.  (OUII also has the power to file a Section 337 complaint on behalf of the public interest, but that power has only been utilized once for a regular Section 337 investigation, and only a few times for “enforcement proceedings” related to outstanding remedial orders.)  The OUII attorney is a full party to the investigation with the same abilities as the attorneys for the private litigants (although almost invariably with far fewer resources!).  This means that the “investigative attorney” (or IA) will conduct written discovery, seek the production of documents, participate in depositions, and engage in motions practice.  Ultimately, the IA will take positions on the merits of all the technical and legal issues and argue those positions in his or her pre-trial brief and at trial before the Administrative Law Judge.  Following the Judge’s decision on the merits, OUII will continue to participate as an independent party in the review proceedings before the Commission, again arguing the positions it has taken previously. It should be kept in mind that OUII makes a decision on how to argue the merits based upon how it views the evidence and the law, not based upon any political considerations or any protectionist or pro-patent leanings.  In reality, because OUII takes a position on all of the issues on an issue by issue basis (down to the level of the individual elements of a patent claim), OUII’s positions are usually not entirely on the side of one of the private parties or the other, but are instead a “mixed bag.” Prospective complainants can meet with OUII before filing a Section 337 complaint.  In practice, how does that work, and what are the benefits in doing so? I can speak to this question as a former OUII supervisory attorney, and less so from my new perspective as a private practitioner.  Attorneys for the prospective complainant will contact OUII a few weeks in advance of completing their draft complaint to let the OUII supervisory staff know that there is a potential new case in the works.  When a draft is ready for review, a meeting or conference call can be set up with OUII.  These days, with the very high caseload level, OUII generally prefers to set the meeting with counsel for prospective complainants to take place a full week to ten days after delivery of a copy of the final draft complaint.  OUII rarely meets with counsel for the prospective complainant without first receiving the draft complaint, with the exceptions usually relating to potential cases that have unique jurisdictional or other fundamental first-impression issues that both the private attorneys and OUII feel should be discussed even before work on a draft is begun. In a typical situation, OUII will have one or two supervisory level or senior staff attorneys review the draft complaint and meet with the prospective complainant’s attorneys (who sometimes are accompanied by an in-house company representative).  Because Section 337 complaints require so much more detail than complaints in the U.S. District Courts, the main purpose and advantage of the review is for OUII to point out areas where the complaint needs more detail.  Unless the complaint’s allegations are obviously and facially insufficient, it is not OUII’s function in these reviews to comment on or take any position on the merits.  OUII’s attorneys do not form any sort of “bond” or “allegiance” with the complainant – they provide procedural information as they would to any member of the public seeking such information.  More often than not, the OUII attorneys reviewing the draft complaint will not be the same OUII attorneys ultimately assigned to the investigation once it is instituted by the Commission. It appears that Markman hearings are becoming more prevalent in Section 337 investigations.  Do you think this trend will continue, and, if so, how will it affect Section 337 practice? I think the jury is still out on the value and practicality of “Markman” (i.e., claim construction) hearings in Section 337 proceedings.  Many in the 337 bar, including some Commission attorneys, see them as a way of promoting earlier settlement, since a party that receives an unfavorable claim construction ruling early in a case may be likely to perceive settlement as a more attractive prospect than going forward through the expensive trial and the review process with a bad construction on the outside hope of having that construction reversed by the Commission (and then having to go through another expensive trial and review process).  In my view, it will likely take years for us to realistically assess whether an early Markman process will significantly impact settlement rates in Section 337 investigations.  Proponents of Markman hearings also point to a reduction in the expense and complexity of trial because it eliminates the need for putting on a case addressing two or more alternative claim constructions. For now, I suspect that the different ITC Judges will continue each with their own versions of the claim construction process.  In other words, some will continue to hold early claim construction hearings (or at least receive written briefs on the subject) and make rulings early enough to impact not just the conduct of the trial but the summary determination phase; and others will take input on the parties’ claim constructions issues before trial so that they are aware of the key elements in dispute but will not decide them until submitting their “final initial determination” on the merits.  This year, Chief Judge Paul Luckern held his first early Markman hearing and issued a ruling, but has often expressed reservations about how the process will work in view of the need for Commission review in time for meaningful consideration of the Commission’s final claim constructions for summary determination motions and trial purposes.  In the case in question, the Commission has sought input from the parties on whether the Judge was correct to issue his claim construction ruling as an “initial determination” (ID) rather than as an ordinary order.  An ID requires the Commission to consider whether to review right away rather than being able to wait until later in the case as happens with orders.  No doubt the Commission’s decision on that issue will impact the future of claim construction procedures at the Commission.  I should point out that Chief Judge Luckern does have at least one more Markman hearing scheduled in a more recently instituted case. How long do ITC trials typically last?  Also, how long is a typical trial day? I have experienced trials that have lasted from one day to more than four weeks, and am aware of some having gone longer.  However, the more common length of trial is one to two weeks.  Most Judges start around 9:00 each morning, and end somewhere between 4:30 and 6:00 p.m.  Some are willing to start earlier and go later if more trial time seems necessary, and some are willing to add a day or more to the length of the trial if needed. To what do you attribute the steady increase in Section 337 filings at the ITC? There are many causes that attorneys in the 337 bar will point to.  I think that the remarkable surge in Section 337 complaints is a combination of factors, with perhaps the biggest truly being a “snowball” effect.  In other words, knowledge of Section 337 as an attractive alternative to district court litigation grew gradually, but at some point reached a critical mass where the message began to spread even more rapidly, so that attorneys that had barely heard about the statute in the past and about the Commission’s ability to handle sophisticated IP cases in an expeditious manner were getting exposed and Section 337 was becoming a serious alternative, both for them and their clients.  The rise of the district court rocket dockets helped emphasize and popularize the notion of obtaining a speedy resolution to IP disputes, which also helped push the ITC into consideration since the Commission had always been known for its speed.  And, of course, there was the Supreme Court’s 2006 eBay decision dealing with the availability (or lack thereof) of district court injunctions in patent cases.  Interestingly,  it does not appear that the Federal Circuit’s 2008 Kyocera decision, making it more difficult to obtain “downstream” relief at the Commission, has had any dampening effect on the filing of cases before the Commission. What is a Section 337 Enforcement Proceeding? The Commission has two basic types of remedies – (1) exclusion orders that are enforced by Customs at the border and (2) cease and desist orders that are like injunctions in that an action to enforce a C&D order must be brought at the issuing tribunal, in this case the Commission.  However, either type of order can serve as the basis for an ITC enforcement action.  There are also two types of enforcement proceeding, formal and informal.  I will limit my answer to the formal type, since the informal-type proceedings are very rare. Generally, enforcement complaints are filed by the party that was the original complainant in the underlying investigation in which the remedial orders issued.  Enforcement proceedings can be self-initiated by the Commission through a complaint filed by OUII, but this is very rare.  The enforcement complaint will allege that the enforcement respondents have violated the Commission’s orders by importing and/or selling products, or engaging in some other related behavior, in violation of the orders.  Not surprisingly, the most common acts alleged in enforcement complaints under Section 337 are continued patent infringements. If the Commission finds the enforcement complaint to be sufficient, it will institute a formal enforcement proceeding that is usually delegated to an Administrative Law Judge for an “enforcement initial determination” (EID).  An OUII staff attorney will be assigned as an independent party to represent the public interest and the Judge will set a target date as in a typical 337 investigation.  The enforcement respondents are given an opportunity to answer the complaint, and typically the case will proceed through discovery and trial much like a regular 337 investigation, followed by the Judge issuing an EID.  The Commission will then decide whether to review the EID or let it stand. If a violation of an exclusion order is found, the Commission has the authority to modify or clarify the order if appropriate, and if the enforcement respondent is not already subject to a C&D order, the Commission can impose one.  If a violation of a C&D order is found, the Commission can impose civil penalties of up to $100,000 per violation day or twice the total domestic value of the infringing goods that were imported and/or sold on each such day by each enforcement respondent.  In addition, if an enforcement respondent’s goods are not already subject to an exclusion order, the Commission can issue one to insure that from that point on there will be border enforcement by Customs.  If a civil penalty is assessed, the government can collect it in a civil action in an appropriate U.S. district court. What are some of the ways that ITC complaints differ from district court complaints? The Commission’s Rules of Practice and Procedure are in many ways patterned after the Federal Rules of Civil Procedure, but are quite different when it comes to what is required in terms of the complaint.  Largely because Section 337 investigations result in considerable involvement by the Commission, a government agency, and can have wide-ranging public interest implications, the Commission through its complaint rule, 19 C.F.R. § 210.12, requires substantially more detail than a district court complaint.  In other words, Section 337 complaints are not notice pleading but fact pleading. In this regard, some of the additional information required from the complainant by the Commission before it will institute an investigation includes (and this is not an exhaustive list):  Tariff Schedule numbers for the accused imported goods; information on related litigation; details regarding the “domestic industry” that the complainant seeks to protect; evidence of patent ownership, including certified copies of any assignments (i.e., certified by the U.S. Patent and Trademark Office); certified copies of the patents themselves and of their prosecution history files; if injury is alleged (as it must be in non-statutory-IP cases), details regarding the injury including information on matters such as complainant’s profits and losses, pricing information, and the level of respondents’ sales of the accused products; licensee information; information on foreign counterpart patents; and detailed claim charts setting forth complainant’s allegations regarding not only respondents’ infringement of all of the asserted independent claims, but also demonstrating the domestic industry’s utilization of the asserted patents. Confidential treatment can be obtained for the complaint and many of the supporting exhibits, but for most such documents the Commission will expect the complainant to supply redacted “public versions.” If there is one thing that you want our readers to know about the ITC and/or Section 337 practice, what is it? Having spent over 23 years with the Office of Unfair Import Investigations and now just beginning with my new firm, WilmerHale, I think it is still most appropriate for me to emphasize the value that OUII brings to the quality and effectiveness of the Section 337 process and to highly recommend that private attorneys appearing in Section 337 investigations appreciate that value and try to take advantage of OUII as a resource and, if possible, an ally in the fray.  Because OUII is an independent and impartial party, it necessarily maintains a certain distance from the private parties in terms of litigation strategy and tactics.  However, OUII does have a public interest in facilitating the process by providing however much information it is practical and appropriate to provide to the “public,” the “public” in this case including the actual litigants appearing in an investigation.  It should be kept in mind that OUII attorneys are experienced in all aspects of Section 337 proceedings (and for information that they don’t know off the top of their heads, they know where to look), as well as in complex patent and other IP litigation, so they can be a resource; again, to the extent practical and appropriate. In terms of briefing and argument in motions practice and in connection with trial on the merits, it is important to keep in mind that while the Judges do not always agree with OUII’s positions, they are always very interested in hearing what OUII has to say and always take OUII’s positions into serious consideration.  This is especially the case for matters that are unique to Section 337 practice at the ITC and for matters of Commission policy, but it is also true for matters such as patent infringement and validity.  Thus, being able to convince the assigned OUII staff attorney of the reasonableness of the client’s positions on the issues is generally perceived as an advantage and worthy of some additional effort.
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