By Eric Schweibenz
On March 13, 2013, the International Trade Commission (“the Commission”) issued a notice in Certain Electronic Devices, Including Wireless Communication Devices, Portable Music and Data Processing Devices, and Tablet Computers (Inv. No. 337-TA-794).  In the notice, the Commission determined to extend the target date for completion of the investigation until May 31, 2013, and requested additional written submissions from the parties and the public on the issues set forth below.

By way of background, the investigation is based on a complaint filed by Samsung Electronics Co., Ltd. and Samsung Telecommunications America, LLC (collectively, “Samsung”) alleging violation of Section 337 by Respondent Apple Inc. (“Apple”) in the importation and sale of certain electronic devices, including wireless communication devices, portable music and data processing devices, and tablet computers that infringe one or more claims of certain U.S. patents.  See our August 1, 2011 post for more details.  On September 14, 2012, ALJ E. James Gildea issued a final initial determination (“ID”) finding no violation of Section 337 by Apple in this investigation.  Specifically, the ALJ found that U.S. Patent Nos. 7,706,348 (the ‘348 patent), 7,486,644 (the ‘644 patent) and 6,771,980 (the ‘980 patent) are valid but not infringed, and that U.S. Patent No. 7,450,114 (the ‘114 patent) is both invalid and not infringed.  ALJ Gildea also determined that the economic prong of the domestic industry requirement is satisfied for all four patents at issue, but that the technical prong is not satisfied for any of the asserted patents.  On November 19, 2012, the Commission determined to review the ID in its entirety and issued a notice requesting written submissions from the parties and the public on certain patent issues, the assertion of FRAND-related patents at the Commission, and on the issues of remedy, public interest and bonding.  See our November 20, 2012 post for more details.

According to the notice, the Commission determined to seek additional information on the potential effect on the public interest if the Commission were to order remedies against articles alleged to infringe the asserted claims of the ‘348 patent.  In particular, the Commission requested written submissions from the parties, interested government agencies, the Office of Unfair Import Investigations, and any other interested persons on the following issues:

  • How would remedial orders barring the entry and further distribution of the accused Apple articles affect the public interest, particularly with respect to (a) the percentage of the total number of imported mobile telephone handsets that would be affected by such orders, (b) the percentage of the total number of imported cellular-network-enabled tablets that would be affected by such orders, (c) the qualitative impact of exclusion of such handsets and tablets, and (d) any other relevant market information bearing on the four statutory public interest factors.

  • Whether third, fourth, and later generation products (if any) are currently available in the U.S. market that are authorized by Samsung to utilize the technology covered by the asserted claims of the ‘348 patent, whether these products are acceptable substitutes for the accused iPhones and iPads, and whether they are widely viewed to be acceptable substitutes.

  • In what ways, if any, a remedy with respect to infringement of the ‘348 patent should be specifically tailored to avoid harm to the public interest.

In addition, the parties were requested to brief the following issues:

  • If the Commission were to issue remedial orders covering articles covered by the asserted claims of the ‘348 patent, whether such an order would cover (a) Apple products that operate on wireless networks in the U.S. other than AT&T, and (b) later generation Apple products (e.g., iPhone 5 and later iPad versions).

  • The history to date of negotiations between Samsung and Apple concerning any potential license to the ‘348 patent, either alone or in conjunction with other patents.

  • All licenses to the ‘348 patent granted by Samsung to any entity.

  • Specific licensing terms for the ‘348 patent that each party believes are fair, reasonable and non-discriminatory, whether Samsung’s terms would change if the Commission were to enter remedial orders against Apple’s accused products, and if so, whether such an offer would be fair, reasonable and non-discriminatory.

  • The Georgia-Pacific factors most relevant to determining whether Samsung has offered to license the ‘348 patent to Apple on fair, reasonable and non-discriminatory terms, and what other factors, if any, are relevant in determining whether Samsung has made a fair, reasonable and non-discriminatory offer.

The Commission requested written submissions by April 3, 2013, and reply submissions by April 10, 2013.

Commissioner Aranoff dissented from the notice, issuing a memorandum stating that in her view, the parties and the public have already had several opportunities to present evidence and argument on the public interest issues relevant to this investigation.