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USITC Limited Exclusion Order Does Not Apply to Non-Respondents

By William F. Heinze

There are two types of import exclusion orders issued by the U.S. International trade Commission -- general exclusion orders and limited exclusion orders. A general exclusion order directs the U.S. Customs Service to exclude all infringing articles, without regard to source. In contrast, a limited exclusion order directs the Customs Service to exclude all infringing articles that originate from a specified firm that was a respondent in the Commission investigation.

In Kyocera Wireless Corp. v. International Trade Commission (October 14, 2008), the Federal Circuit vacated and remanded a limited exclusion order ("LEO") by the International trade Commission against the importation of all downstream products containing the accused technology. Despite the broad downstream scope of the LEO, Broadcom named only Qualcomm as a respondent in its ITC complaint.

According to the opinion by Circuit Judge Radar,

. . . this court has consistently honored the . . . distinction between limited and general exclusion orders. For example, this court has held that LEOs "only apply to the specific parties before the Commission in the investigation." Fuji Photo Film Co. v. ITC, 474 F.3d 1281, 1286 (Fed. Cir. 2007). By contrast, GEOs "bar the importation of infringing products by anyone, regardless of whether they were a respondent in the Commission's investigation." Id.; see also Vastfame Camera, Ltd. v. ITC, 386 F.3d 1108, 1114 (Fed. Cir. 2004) ("A general exclusion order broadly prohibits entry of articles that infringe the relevant claims of a listed patent without regard to whether the persons importing such articles were parties to, or were related to parties to, the investigation that led to issuance of the general exclusion order."). . . .

In summary, Section 337 permits exclusion of the imports of non-respondents only via a general exclusion order, and then too, only by satisfying the heightened requirements of 1337(d)(2)(A) or (B). The statute permits LEOs to exclude only the violating products of named respondents. Because the Act speaks unambiguously to the precise question at issue in this case, the Chevron inquiry is at an end. This court must simply "give effect to the unambiguously expressed intent of Congress." Chevron, 467 U.S. at 843. Because the Commission did not issue a GEO under either of the two statutory exceptions in 19 U.S.C. § 1337(d)(2), the Act prevents the Commission from issuing a limited exclusion order that excludes products of those who are not "persons determined . . . to be violating [Section 337]." Accordingly, this
court vacates the ITC?s exclusion order. On remand, the Commission can reconsider its enforcement options.

. . . Finally, this court vacates and remands the exclusion order fashioned by the Commission because Section 337 unambiguously limits the ITC?s exclusionary authority to persons named by the complainant.

Full post as published by I/P Updates on October 16, 2008 (boomark / email).