{"id":3762,"date":"2024-05-08T17:00:00","date_gmt":"2024-05-08T22:00:00","guid":{"rendered":"https:\/\/patents.harnessip.com\/?p=3762"},"modified":"2024-05-09T08:56:28","modified_gmt":"2024-05-09T13:56:28","slug":"aggregate-data-is-not-enough-to-show-domestic-industry-in-a-section-337-proceeding","status":"publish","type":"post","link":"https:\/\/patents.harnessip.com\/?p=3762","title":{"rendered":"Aggregate Data is Not Enough to Show Domestic Industry in a Section 337 Proceeding."},"content":{"rendered":"\n

In Zircon v. ITC<\/em>, [2022-1649]<\/a> (May 8, 2024), the Federal Circuit Court affirmed the ITC determination of no violation of section 337. The case involved U.S. Patent Nos. 6,989,662, 8,604,771, and 9,475,185, on electronic stud finders.<\/p>\n\n\n\n

To establish a section 337violation, Zircon was required to show that \u201can industry in the United States, relating to the articles protected by the patent . . . exists or is in the process of being established.\u201d 19 U.S.C. \u00a7 1337(a)(2). This is referred to as the \u201cdomestic industry\u201d requirement. The ALJ found that the economic prong of the domestic industry requirement was not satisfied with respect to any of the asserted patents. The Commission upheld the ALJ\u2019s determination that there was no violation of section 337, for two independent reasons. First, with respect to the domestic industry requirement, the Commission affirmed the ALJ\u2019s determination that Zircon had not satisfied the economic prong of that requirement. Second, the Commission found each of the claims of the \u2019662, \u2019771, and \u2019185 patents that were before the Commission were either invalid or not infringed.<\/p>\n\n\n\n

To meet the domestic injury requirement, a complainant can show that, \u201cwith respect to the articles protected by the patent,\u201d there is \u201c(A) significant investment in plant and equipment; (B) significant employment of labor or cap-ital; or (C) substantial investment in its exploitation, including engineering, research and development, or licensing.\u201d 19 U.S.C. \u00a7 1337(a)(3)(A)\u2013(C). That provision is referred to as the \u201ceconomic prong\u201d of the domestic industry requirement.<\/p>\n\n\n\n

Zircon has relied on evidence of its cumulative expenditures on all 53 of its domestic industry products to argue that its investments in plant and equipment, labor or capital, and\/or research and development have been significant or substantial. Zircon had acknowledged, however, that not all 53 products prac-tice all three of the asserted patents. Rather, Zircon\u2019s evidence showed that of the 53 products, 14 practice all three of the asserted patents; 21 practice both the \u2019771 and \u2019185 patent; 16 practice only the \u2019662 patent; and two practice only the \u2019771 patent. Zircon did not allocate its expenditures on its 53 stud finder products separately with respect to each of its products or each of the asserted patents. The Commission found that Zircon\u2019s failure to do such an allocation precluded the Commission from evaluating the significance of Zircon\u2019s investments with respect to each asserted patent.<\/p>\n\n\n\n

On appeal, Zircon argued that the Commission erred by requiring a patent-by-patent breakdown of its investments and that, in doing so, the Commission departed from its \u201cflexible, market-oriented approach to domestic industry\u201d in Certain Wireless Devices with 3G and\/or 4G Capabilities & Com-ponents Thereof, Inv. No. 337-TA-868, USITC Pub. 4475, Initial Determination at 413 (July 29, 2013).<\/p>\n\n\n\n

The Federal Circuit found the ITC actions were consistent with Federal Circuit precedent, noting that it has held that where a party seeks to rely upon research and development activities, it must show that those activities the complainant must show that those activities \u201cpertain to products that are covered by the patent that is being asserted.\u201d The Federal Circuit explained that “[i]n cases in which all the domestic industry products practice all the asserted patents, it follows from the language of section 337 and our case law that the complainant could satisfy the economic prong as to all asserted patents based on the entire product group. But in cases in which the complainant\u2019s products or groups of products each practice different patents, the complainant would need to establish separate domestic industries for each of those different groups of products.”<\/p>\n\n\n\n

Zircon further argued that in a case such as this one, the Commission\u2019s analysis should proceed on the basis that there is a single industry which exploits the patents. But the Federal Circuit distinguished ZIrcon’s precedent because Zircon sought to aggregate were not all protected by the same patent or patents. The Federal Circuit noted that Zircon might have been able to show the substantial or significant investment requirement was met by its investment in the 14 products that practice all three asserted patents, but Zircon provided no way for the Commission to assess the significance of Zircon\u2019s investment in that product group because Zircon presented its investments in the aggregate for all 53 products, which practiced multiple different combinations of patents.<\/p>\n\n\n\n

Because it upheld the Commission\u2019s ruling on the domestic industry issue, the Federal Circuit said it was unnecessary for it to reach Zircon\u2019s challenges to the Commission\u2019s infringement and invalidity rulings.<\/p>\n","protected":false},"excerpt":{"rendered":"

In Zircon v. ITC, [2022-1649] (May 8, 2024), the Federal Circuit Court affirmed the ITC determination of no violation of section 337. The case involved U.S. Patent Nos. 6,989,662, 8,604,771, and 9,475,185, on electronic stud finders. To establish a section … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[90],"tags":[],"class_list":["post-3762","post","type-post","status-publish","format-standard","hentry","category-itc"],"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/3762","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3762"}],"version-history":[{"count":1,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/3762\/revisions"}],"predecessor-version":[{"id":3763,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=\/wp\/v2\/posts\/3762\/revisions\/3763"}],"wp:attachment":[{"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3762"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3762"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/patents.harnessip.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3762"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}