By Eric Schweibenz
On July 27, 2009, ALJ Carl C. Charneski issued the public version of Order No. 14 (dated February 27, 2009) in Certain Cast Steel Railway Wheels, Certain Processes For Manufacturing Or Relating To Same And Certain Products Containing Same (Inv. No. 337-TA-655).  In the Order, ALJ Charneski denied Respondent Tianrui Group Foundry Limited’s (“Tianrui Foundry”) motion to terminate the investigation based on its assertion that Complainant Amsted Industries Incorporated’s (“Amsted”) complaint did not allege a claim upon which relief can be granted.

By way of background, Amsted filed a complaint against Tianrui Foundry, Tianrui Group Company Limited, Standard Car Truck Company, and Barber Tianrui Railway Supply, LLC (collectively, “Respondents”) alleging violation of section 337 based on the importation and sale of Tianrui Wheels manufactured through a process that allegedly uses Amsted’s misappropriated trade secrets (the “ABC Trade Secrets”).  Amsted’s complaint further alleges that Respondents recruited nine former employees of Datong ABC Castings Company Limited, a licensee of Amsted’s ABC Technology located in China, for the purpose of acquiring the ABC Trade Secrets.

In its motion to terminate, Tianrui Foundry asserted that “the accused acts do not stem from any action in the United States, but are alleged to have taken place in China.”  Thus, Tianrui Foundry asserted, that the accused acts do not implicate U.S. law, but only the laws of China and, therefore, section 337 does not apply in this scenario.  Both Amsted and the Commission Investigative Staff (the “Staff”) opposed Tianrui Foundry’s motion to terminate.

In the Order, ALJ Charneski rejected Tianrui Foundry’s arguments determining that “the plain wording [of] section 337 supports the position advanced by both Amsted and the Staff.”  Specifically, ALJ Charneski determined that “a section 337 violation lies as long as a trade secret was wrongly misappropriated (and the other section 337 criteria are met as well), regardless of whether the trade secret was appropriated within, or without, the boundaries of the United States and its territories.”  ALJ Charneski further noted that to hold otherwise “would render the applicable statutory provision of section 337 relatively useless.”  Accordingly, ALJ Charneski denied Tianrui Foundry’s motion to terminate determining that “Tianrui Foundry has failed to show that this investigation should not proceed.”