Chinese companies who import products or own patents in the U.S. should understand intellectual property investigations at the International Trade Commission (“ITC”). The ITC presents both great danger and great opportunity. Here, we provide an overview of the ITC and highlight its key distinguishing features.
In the United States, federal district courts typically hear disputes over patents and other intellectual property rights. The ITC is an alternative forum. An ITC investigation begins when the patent owner (or “Complainant”) accuses another (the Respondent”) of importing into the United States a product that infringes a U.S. patent, copyright, or trademark.
ITC and district court litigations share much in common. In both, parties produce documents, respond to interrogatories, depose witnesses, and submit expert reports. The Complainant alleges infringement and Respondents can argue the claims are invalid, unenforceable, or not infringed. The ITC judge will construe the claims, decide infringement and invalidity, and, if a valid and enforceable claim is infringed, determine the appropriate remedy.
But the ITC differs from district courts in important ways. First, the ITC is fast – trial in barely nine months with an initial decision shortly thereafter. Average district court patent cases take over two and a half years just to reach trial, and the entire case can be years longer. Second, in a district court case, patent owners get money damages but only rarely an injunction prohibiting continued infringement. The ITC cannot award money damages and will almost always grant an injunction to a prevailing patent owner. Third, district court patent cases are decided by juries who usually lack technical or legal experience. ITC cases are decided by judges experienced in such matters. This allows parties to present more technical arguments. Fourth, in the ITC a government agency called the “Office of Unfair Import Investigation” (“OUII”) may participate. The OUII starts out neutral, but by trial will take positions to help one side or the other.
The differences between the ITC and a district court can mean the difference between winning and losing. Even good general patent litigation attorneys often make damaging mistakes in ITC cases. Companies should hire experienced ITC attorneys who how to make the most effective use of ITC rules and requirements.
For example, unlike a district court, the ITC requires the patent owner to prove that it or its licensees are using the asserted patent in the United States. This “domestic industry” requirement can provide an additional defense and area for discovery for a party accused on infringement. Similarly, experienced ITC attorneys will know how to work with the OUII and encourage them to take favorable positions. ITC attorneys will also understand the scope of the potential remedies and how to minimize the disruption an injunction may cause.
The ITC is a powerful, fast moving court that does not allow the luxury of “learning as you go.” It has particular rules and presents specific challenges that must be addressed for a party to be successful.
By Bas de Blank and Vann Pearce