On February 9, 2012, the International Trade Commission (the “Commission”) issued a notice and advisory opinion granting a request by non-respondent Holland Electronics, LLC (“Holland”) and determining that Holland’s identified coaxial cable connectors are not covered by the Commission’s March 31, 2010 general exclusion order for U.S. Patent No. 6,558,194 in Certain Coaxial Cable Connectors and Components Thereof and Products Containing Same (Inv. No. 337-TA-650).

By way of background, the Complainant in this investigation is John Mezzalingua Associates, Inc. d/b/a PPC, Inc. (“PPC”) and the Respondents are Fu Ching Technical Industry Co. Ltd., Gem Electronics, Inc. (collectively, the “Active Respondents”), Hanjiang Fei Yu Electronics Equipment Factory, Zhongguang Electronics, Yangzhou Zhongguang Electronics Co., Ltd., and Yangzhou Zhongguang Foreign Trade Co., Ltd. (collectively, the “Defaulting Respondents”).  The investigation was instituted on May 30, 2008.  On October 13, 2009, ALJ Gildea issued his Initial Determination (“ID”) finding, inter alia, that the Defaulting Respondents violated Section 337 by infringing various patents, including U.S. Patent No. 6,558,194 (the ‘194 patent).  See our November 10, 2009 post for more details.  On December 14, 2009, the Commission determined to review the ID in part, but the Commission did not review the ALJ’s determination with respect to the ‘194 patent.  See our December 16, 2009 post for more details. The Commission issued a general exclusion order on March 31, 2010 with respect to the ‘194 patent based on finding a violation of Section 337 by the defaulting respondents. 

According to the opinion, Holland filed a request on September 12, 2011, for an advisory opinion under Commission Rule 210.79, asking the Commission to determine that its identified connectors are outside of the scope of the Commission's March 31, 2010 general exclusion order.  Holland first argued that it is authorized to import and sell its identified connectors because PPC entered into a covenant not to sue with Holland in 2006.  Holland additionally argued that its identified connectors did not infringe the ‘194 patent.  Holland requested expedited consideration and asserted that referral to an ALJ was unnecessary.  Holland noted that U.S. Customs and Border Protection (CBP) was holding Holland’s connectors at two ports in California, and CBP indicated it would not consider the legal import of Holland’s covenant not to sue with PPC.  According to the opinion, neither PPC nor the Commission Investigative Attorney disputed that the Holland products at issue are subject to a covenant not to sue, and both agreed that Holland’s identified products do not fall within the scope of the exclusion order.

The Commission determined that the March 31, 2010 general exclusion order covered coaxial connectors that infringe claims 1 and/or 2 of the ‘194 patent, “except under license of the patent owner or as provided by law,” and that according to the Federal Circuit, covenants not to sue are equivalent to non-exclusive patent licenses.  The Commission therefore agreed with the parties and determined that Holland’s identified products that are subject to the covenant not to sue are outside the scope of the March 31, 2010 general exclusion order.