Further to our July 7 post, on July 20, 2009 the International Trade Commission issued the public version of its Opinion issuing a General Exclusion Order (“GEO”) in Certain Hair Irons and Packaging Thereof (Inv. No. 337-TA-637).  In this investigation, Complainant Farouk Systems, Inc. (“FSI”) accused several respondents of infringing FSI’s CHI® trademark.  The respondents either signed consent orders or were found in default.

In the Opinion, the Commission cited to the Federal Circuit’s Kyocera decision and stated that parties must meet the “heightened requirements of Section 337(d)(2)(A) or (d)(2)(B)” before the ITC has the authority to issue a GEO.  The Commission agreed with ALJ Charneski’s findings that there has been a pattern of violation of FSI’s CHI ® trademark and that it is difficult to identify the source of infringing goods.  The Commission therefore agreed that the statutory requirements of section 337(d)(2)(B) had been met, and that a GEO was appropriate.  In particular, the Commission found:  (1) FSI has initiated 21 lawsuits in district courts, which have failed to stop the infringement; (2) FSI has monitored thousands of offers for sale of infringing hair irons and attempted to shut down websites or online offers originating in the United States; (3) it is difficult to identify the source of the infringing products because companies infringing FSI’s trademark are deliberately misrepresenting their products as those of FSI; (4) infringers are mismarking the country of origin to increase confusion; and (5) the products are distributed over the Internet, which lends itself to anonymity.

The Commission found the GEO would not be contrary to the public interest since the respondents remain free to sell hair irons without infringing the CHI® trademark.  Finally, the Commission imposed a bond of 100% of the value of the infringing goods during the Presidential review period.