The International Trade Commission, although having limited jurisdiction, can be a very powerful ally to U.S. industries facing foreign competition.  The Commission's power to interdict importation of infringing articles can keep them languishing at ports of entry and effect an injunction under circumstances where U.S. district courts' injunctive powers may be limited, for example under eBay v. MercExchange.  But the Commission's powers are circumscribed in other ways, as illustrated by the Federal Circuit's decision last week in Amarin Pharma, Inc. v. ITC involving the interplay between that jurisdiction and the Food and Drug Administration's plenary powers over regulating drugs.

The case arose over importation by Royal DMS NV and other related off-shore companies (intervenors in the Federal Circuit appeal) of unregulated and unapproved "natural" analogs of Amarin's Vascepa® capsules, consisting of 1 gram of an ethyl ester form of eicosapentaenoic acid (the omega-3 acid commonly known as "EPA").  Amarin filed under oath a complaint with the ITC under Section 337 of the Tariff Act of 1930, that alleged importation of falsely labeled formulations of ethyl esters of eicosapentaenoic acid and false advertising related to the use of these capsules as dietary supplements.  According to Amarin, these capsules were in reality new drugs subject to FDA approval that had not been approved for use or sale in the U.S.  Specifically, the complaint contained two allegations:  "(1) that the importation and sale of the articles is an unfair act or unfair method of competition under § 337 because it violates § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), [] and (2) that importation of the articles violates the Tariff Act 'based upon the standards set forth in the FDCA'" (citations omitted).  Amarin sought an exclusion order pursuant to § 337(d) and a "cease and desist" order under § 337(f) (which if granted would prevent respondents from "importing, using, or selling" their product in the U.S.).

The FDA responded to Amarin's complaint in a letter urging the ITC not to institute an investigation on the grounds that the Food, Drug, and Cosmetic Act does not authorize a private cause of action to enforce the FDCA.  The FDA contended that only the agency has that responsibility, and enforcement or interpretation of the FDCA is restricted to the FDA (and outside the ITC's jurisdiction), consistent with the Supreme Court's decision in POM Wonderful LLC v. Coca-Cola Co., 573 U.S. 102, 109 (2014).  Acceding to these arguments, the ITC refused to institute an investigation on Amarin's complaint and dismissed it.  This appeal, alternatively stylized as a petition for writ of mandamus, followed.

The Federal Circuit affirmed, in an opinion by Chief Judge Prost and Judge Hughes; Judge Wallach dissented.  Chief Judge Prost's opinion begins with the panel majority's conclusion that the Court had appellate jurisdiction over this dispute (a position disputed by both the Intervenors and the ITC and the source of Judge Wallach's dissent).  Under the Court's jurisdictional statute, 28 U.S.C. § 1295(a)(6), the Federal Circuit has "exclusive jurisdiction 'to review the final determinations of the United States International Trade Commission relating to unfair practices in import trade, made under section 337 of the Tariff Act of 1930 (19 U.S.C. [§] 1337).'"  The jurisdiction question thus devolved to whether a decision not to institute an investigation satisfies the requirement under the statute for a "final determination," which has statutory support under 19 U.S.C. § 1337(c).  According to the Intervenors and the ITC, a final determination requires an investigation to have been instigated by the Commission.

The panel majority held that the proper interpretation is found in the Court's Amgen Inc. v. ITC decision, 902 F.2d 1532 (Fed. Cir. 1990).  There, although the Commission instituted an investigation, it ultimately dismissed the complaint.  The majority interpreted its jurisdiction as requiring a final determination on the merits, and that the Commission's decision to dismiss the complaint was a final decision on the merits that satisfied the requirements of § 1295(a)(6); dismissal on different grounds here (the complaint being precluded by the FDCA) did not distinguish the jurisdictional posture in the panel majority's opinion.  And because the panel majority expected that any future complaint by Amarin on these same grounds would meet the same fate (preclusion by the FDCA) the ITC's decision was, for all intents and purposes, final.  Accordingly, the panel majority decided it could properly exert jurisdiction in this case.

Intervenors and the ITC further argued that the Commission had a mandatory, non-discretionary duty to institute under 19 U.S.C. § 1337(b)(1) ("The Commission shall investigate any alleged violation of this section on complaint under oath or upon its initiative.").  But other provisions of the statute are inconsistent with this interpretation according to the panel majority, including § 1337(b)(3) (the Commission "may institute"); § 1330(d)(5) (an investigation is instituted if "one-half of the number of commissioners voting agree"); and 19 C.F.R. § 210.10(a)(1) (an investigation is instituted if the complaint is properly filed) (emphasis in opinion), and if not the complaint will be dismissed under 19 C.F.R. § 210.10(c)).  Citing Syntex Agribusiness, Inc. v. ITC, 659 F.2d 1038 (CCPA 1981), the opinion notes that the ITC can properly dismiss if the complaint does not assert sufficient facts in support thereof.  The panel majority thus held that "the Commission may decline to institute an investigation where a complaint fails to state a cognizable claim under § 337," i.e., institution is not mandatory.

Turning to the merits, the panel majority held that the Commission properly dismissed the complaint because Amarin's allegations of unfair competition "cognizable under § 1337(a)(1)(A)" was precluded by the FDCA.  If Royal DSM's challenged merchandise was a nutritional supplement and not a new drug, then this merchandise would not fall within the provisions of the FDCA and the ITC would not be precluded from investigating Amarin's complaint.  But the basis of Amarin's complaint was that Royal DSM's merchandise was not a nutritional supplement but rather a new drug and thus the merchandise would fall within the purview of the FDCA and Amarin's complaint to the ITC was properly precluded.  Under POM Wonderful LLC v. Coca-Cola Co., 573 U.S. 102, 109 (2014), the FDCA provides that the FDA had "nearly exclusive enforcement authority" over the provisions of the FDCA, and private parties cannot bring suit to enforce the FDCA.  This interpretation of the scope (almost plenary) of the enforcement exclusion limited to the FDA under the FDCA in Lanham Act cases has been applied by the Ninth Circuit (PhotoMedex, Inc. v. Irwin, 601 F.3d 919 (9th Cir. 2010)); the Eighth Circuit (Alpharma, Inc. v. Pennfield Oil Co., 411 F.3d 934 (8th Cir. 2005)); and the Third Circuit (Sandoz Pharm. Corp. v. Richardson-Vicks, Inc., 902 F.2d 222 (3d Cir. 1990)).  The behaviors alleged in Amarin's complaint under the Lanham Act all required the ITC to make determinations on whether there were FDCA violations (for example, claiming status as a "dietary supplement," which requires FDA approval, as well as Amarin's allegations that Royal DSM's merchandise was a "new drug" that also requires FDA approval).  The facts here were similar to those in the PhotoMedex case, and the Federal Circuit panel majority held that the Ninth Circuit's reasoning regarding preemption was persuasive in this case.  Specifically, the panel majority held that "the alleged violations of § 337 are based entirely on—and could not exist without—the FDCA" and, as in PhotoMedex, the FDA has not issued guidance on an approval pathway or whether Royal DSM's merchandise constituted a new drug.  Saying that the Court "need [] go [no] further" than the PhotoMedex court, the panel majority held that "a complainant fails to state a cognizable claim under § 337 where that claim is based on proving violations of the FDCA and where the FDA has not taken the position that the articles at issue do, indeed, violate the FDCA.  Such claims are precluded by the FDCA."

The panel majority also distinguished the Supreme Court's holding in POM Wonderful, saying that "[t]he allegations underlying the Lanham Act claim in POM Wonderful did not require proving a violation of the FDCA itself," unlike here, and that distinction was enough to reach the opposite outcome.  And the panel majority also set forth the legal difference between a case involving preemption (typically between a state law or regulation and a supervening Federal statute) and preclusion (where the question is which Federal statute controls, which was the question in this case).

Judge Wallach dissented on the jurisdictional question.  His argument is purely textual:  the Tariff Act states that "[a]ny person adversely affected by a final determination of the [ITC] under subsection (d), (e), (f), or (g) of [§ 1337] may appeal such determination . . . to the United States Court of Appeals for the Federal Circuit" under § 1337(c); this excludes on its face decisions not to institute under § 1337(b) (as is the circumstance here and thus the Federal Circuit is without jurisdiction to consider Amarin's appeal).  Other case law, and legislative history, supports Judge Wallach's conclusion under his reasoning, and while he agrees with the majority that Amarin is not entitled to relief, he would base this outcome on Amarin's failure to establish it was entitled to the "extraordinary relief" of a writ of mandamus (for which the All Writs Act properly bestows jurisdiction on the Court).

Amarin Pharma, Inc. v. ITC (Fed. Cir. 2019)
Panel: Chief Judge Prost and Circuit Judges Wallach and Hughes
Opinion by Chief Judge prost; dissenting opinion by Circuit Judge Wallach