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Death of the ITC?
Reprinted with permission.
Maggie Tamburro on 2012/11/12
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Is the ITC a superfluous and redundant infringement tribunal which undermines the U.S. patent system and fails
to serve a valid purpose in patent litigation?
The National Law Journal recently published a provocative
editorial written by a trade policy analyst, who challenged the propriety of the U.S. International Trade Commission
(ITC) in the U.S. patent law system. The author questioned the validity of a tribunal which allows patent
holders to sue, sometimes simultaneously, in two separate forums – federal court and the ITC.
The author asserted
that allowing the ITC to operate as a specialized patent court is redundant to the federal court system, undermines
integrity of the U.S. patent system, and is bad law. He states, "The ITC serves no legitimate purpose, disrupts
the U.S. patent system and violates international law."
Protectionism arguments aside, the piece challenged
us to ponder the ITC's role in today's patent law system – a system many believe is flawed in a variety of ways, not
the least of which is duplicative infringement forums. Kudos to the author for a well written editorial which
challenges one's views and perspective in a thought provoking way.
However, allow me to present a few counter-arguments.
Despite a plethora of long-standing complaints regarding the broken U.S. patent system, including the often unwarranted
criticism recently targeted at those who engage in offensive patent litigation (as we discussed in an
earlier post), demand for legal
services involving intellectual property is actually down for the first time in two years. According to a
recent report published in the ABA Journal, the third quarter of this year showed a decrease of almost 4% in demand
for intellectual property services.
About The ITC
ITC is a U.S. federal investigative agency which operates under a
trade statute targeted at unfair practices in U.S. imports
and trade. Section 337 investigations operate under Commission promulgated rules and in conformity with
the Administrative Procedure Act.
Comparing the ITC with the federal court system is like comparing apples
to oranges. The ITC and federal court are a different means to a similar end result – that of an exclusion-type
order or injunction against an adjudged infringer. However, the ITC and federal court differ in significant
ways that make the ITC a strategically important forum for patent litigation under certain facts and circumstances.
On that note, what follows is a counterpoint to The National Law Journal's article, along with four compelling
reasons why the ITC still serves a valuable legal role as a patent infringement tribunal.
1. Uniqueness of
Remedies. Because the ITC involves in rem or product related jurisdiction, it allows for a general exclusion order
– a unique order which is applicable not only to those participating in the ITC action, but also those not specifically
named. Thus, a general exclusion order can act to prohibit the importation of infringing products into the U.S.,
regardless of the source. In some circumstances this can actually prevent repeat litigation aimed at multiple
The ITC's relief is distinct from federal court in some ways – for example exclusion orders only
apply to products that are being imported into the U.S., and the ITC cannot award monetary damages. However,
a general exclusion order is both unique and potent. It is available from the ITC in addition to a limited exclusion
order (excluding imports of products from only named parties) and a cease and desist order (directing the parties
to cease certain actions, such as sale of certain infringing products already in the U.S.). The issuance of
a general exclusion order is an important legal remedy not available in federal court. Should the ITC tribunal
disappear, so does the ability to request this unique type of relief.
2. Shorter Claim Resolution Time. The
ITC can provide a faster route than federal court for resolution of infringement claims. According to an InsideCounsel
published this year, the average time for resolution of patent litigation in the ITC was just over 13 months in 2011,
compared to a wait time of around 18 months in 2010 and 2009.
In contrast, the average time it now takes to
get to trial stage in district court seems to be increasing, perhaps in part due to the AIA Joinder of Parties provision
restricting the joinder of unrelated patent defendants, which I
wrote about this year.
For example, wait time in the ever popular Eastern District of Texas (termed the "rocket docket" in prior years thanks
to speedy expedition of patent cases) has doubled, and is reportedly
two years on average.
3. Greater Level of Expertise. Litigation brought in the ITC is more likely to involve
judges and other experienced legal professionals with expertise in patent litigation and legal matters. Since
the ITC is a federal investigative agency, the filing of a complaint triggers the determination of whether an investigation
should take place. If the investigation moves forward, an ITC investigative staff attorney is assigned to advise
on matters that may come before the Commission for review. In addition, an administrative law judge who is likely
experienced in patent matters will preside over the litigation, rather than risking a jury who may be unfamiliar with
patent law or the technical issues in the case. Additionally, in recent years the ITC has added a
mediation program available for all Section 337 investigations which utilizes mediators and consultants with experience
in patent litigation.
4. Difficulty of Obtaining Injunctive Relief in Federal Court. Following the 2006 U.S.
Supreme Court decision in eBay, Inc. v. MercExchange L.L.C., permanent injunctive relief to prohibit infringement
of an adjudicated patent infringer became much more difficult to obtain, requiring the meeting of a traditional four-factor
test (rather than a presumption of irreparable harm). This makes the ITC forum more attractive for those
seeking exclusion of an adjudged infringer in cases that can also be properly brought under Section 337 – those involving
infringing products that are being imported into the U.S. In short, because the remedies are different (although
often achieving a similar result), the eBay factors do not apply to the ITC's remedy determinations.
In sum, the
ITC and federal court are distinctly different patent forums that complement each other as a larger part of the U.S.
patent system. Doing away with the ITC would possibly deprive patent holders of important rights and remedies that
are otherwise wholly unavailable in federal court, as well as limit legal access to a specialized venue that offers
strategic advantages under the right circumstances.
Tell us what you think: Is the ITC a strategically important
forum in addition to federal court, or is it misused, duplicative, and bad patent law?
Maggie Tamburro Maggie Tamburro is an attorney, legal writer
and commentator who holds a B.A. from The University of Texas and a J.D. from The John Marshall Law School (ranked
in 2012 by U.S News & World Report as 6th best in the nation for its legal writing program). Maggie graduated
5th in her class from John Marshall, served as Law Review Associate Editor, and was awarded the Dean's Scholarship
Award for three consecutive years. Maggie holds the position of Senior Copywriter at IMS ExpertServices, where she
handles the creation and optimization of webpage copy, print material language, and plays an active role in the company's
online social media strategy. Maggie was admitted to the Illinois Bar in 1994 and Florida Bar in 1999 and has significant
experience in legal research, editing, and writing. From drafting complex commercial transactional documents to journalistic
reporting, Maggie brings a unique blend of background, experience, and perspective to IMS in both the area of law
This article was originally published in
BullsEye, a newsletter distributed
by IMS ExpertServices™. IMS Expert Services is the
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