ITC Section 337 Update – July 2014

by King & Spalding

Commission Enforcing General Policy In Favor Of Transparency With Respect To Settlement Agreements – On July 7, 2014, Administrative Law Judge E. James Gildea issued Order No. 66 in Certain Integrated Circuit Devices And Products Containing The Same, Inv. No. 337-TA-873, ordering submission of a revised redacted version of a settlement agreement submitted by the parties pursuant to Commission Rule 210.21(a) in support of a joint motion to terminate the investigation.  ALJ Gildea found that the parties “have redacted large portions of the agreement, without explanation, that seemingly go beyond the Commission’s definition of confidential information” and “general policy in favor of transparency” with respect to disclosure of settlement agreements stated by the Commission in response to public comments to the Commission’s proposed changes, now incorporated, in Rule 210.21.  ALJ Gildea further found that the parties “have redacted whole sections of their agreement for which it cannot possibly be argued that those sections include confidential information in their entirety” and that “it is not a sufficient basis to redact material simply because it is unrelated to other Respondents in this Investigation.”  ALJ Gildea relied upon his earlier Order No. 14 in Certain Consumer Electronics With Display And Processing Capabilities, 337-TA-884, where he foundthat the only information that should be redacted from a settlement agreement were the “core financial terms,” and redacting material because it relates “to details that are not at issue in this Investigation” is not appropriate.

Aftermath Of Limelight v. Akamai (Issues Left Undecided) – In Limelight v. Akamai, 134 S.Ct. 2111 (2014), the Supreme Court held that a defendant may not be liable for inducing infringement of a method patent under 35 U.S.C. §271(b) when no single party has directly infringed the patent by carrying out all steps of the claimed method.  The Court reversed the Federal Circuit’s en banc decision which held that “§271(b) liability arises when a defendant carries out some steps constituting a method patent and encourages others to carry out the remaining steps. . . .”  The Court found that it was undisputed that defendant Limelight does not perform the claim step of tagging components to be stored on its servers, which Limelight requires its customers to do.  Notably, the Court did not decide the issue of joint infringement and whether Limelight committed direct infringement by exercising “control or direction” over the entire method as held by the Federal Circuit in Muniauction v. Thomson, 532 F.3d 1318 (Fed. Cir. 2008), and whether the Muniauction rule is correct.  The Court remanded this issue to the Federal Circuit “to revisit the §271(a) question if it so chooses.”  The Court also did not decide the question of inducing infringement when claims are directed to a product or apparatus, which the Federal Circuit en banc panel found is always present for such claims “because the entity that installs the final part and thereby completes the claimed invention is a direct infringer.”  692 F.2d at 1305-06.

Former Chief Judge Randall Rader Retires From The Court Of Appeals For The Federal Circuit – Judge Randall Rader announced his retirement from the United States Court of Appeals for the Federal Circuit, effective June 30, 2014.  Judge Rader’s retirement announcement was a surprise to many, particularly as it came only a few weeks after announcing he would step down as Chief Judge of the Court but would continue in active service on the Court.  Judge Rader has indicated future plans to teach and travel.  Following Judge Rader’s decision to step down as Chief Judge, and consistent with statutory succession provisions, Judge Sharon Prost assumed the position of Chief Judge of the Federal Circuit on May 31, 2014.  Chief Judge Prost was appointed to the Federal Circuit in 2001 by President George W. Bush.  Now that Judge Rader has retired from the Court, attention has turned to who President Obama will tap to replace him, although getting a candidate vetted, nominated, and confirmed is not anticipated to occur during this Congress.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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