In Laerdal Medical Corp. v. ITC, [2017-2445] (December 7, 2018), the Federal Circuit reversed the ITC’s denial of remedies against defaulting respondents because Laerdal failed to properly plead its trade dress claim.

, [2017-2445] (December 7, 2018), the Federal Circuit reversed the ITC’s denial of remedies against defaulting respondents because Laerdal failed to properly plead its trade dress claim.

The Commission concluded that, even when the pleaded facts were presumed true, Laerdal failed to show that any of the defaulting respondents violated § 1337 with respect to the alleged trade dresses and copyrights.  Specifically, the Commission found that Laerdal failed to plead sufficiently (1) that it suffered the requisite harm, (2) the specific elements that constitute its trade dresses, and (3) that its trade dresses were not functional.

Thus, despite approving the ALJ’s initial determination finding all respondents in default and despite requesting supplemental briefing solely related to the appropriate remedy, the Commission issued Laerdal
no relief on those claims or against any of the respondents named in those claims.  Laerdal appeals the Commission’s termination of its trade dress claims, contending the Commission acted in violation of § 1337(g)(1) by terminating the investigation and issuing no relief for its trade dress claims against defaulting respondents.

19 U.S.C. § 1337(g)(1) provides that in the event of a default, the Commission shall presume the facts alleged in the complaint to be true and shall, upon request, issue an exclusion from entry or a cease and desist
order, or both.  The Federal Circuit concluded that statute, on its face, unambiguously requires the Commission to grant relief against defaulting respondents, subject only to public interest concerns, if all prerequisites of § 1337(g)(1) are satisfied. The statute’s plain text, surrounding context, purpose, and legislative history, as well as the Commission’s own
prior decisions, supported this conclusion.