ITC Section 337 Update – September 2015

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Judge MaryJoan McNamara Appointed New Administrative Law Judge at U.S. International Trade Commission – On August 17, 2015, the ITC issued a news release announcing that Judge MaryJoan McNamara has been appointed as an ALJ. Prior to joining the ITC, Judge McNamara was an ALJ with the Social Security Administration’s Office of Disability Adjudication and Review (National Hearing Center) in Baltimore, Maryland. Previously in her career, Judge McNamara was a consultant to the U.S. Department of State on certain provisions of the Hague Convention, an EEO specialist in the U.S. Department of Agriculture’s Office of Adjudication and Compliance, a Special Assistant Attorney General in Massachusetts, and a Superior Court Conciliator in Lowell, Massachusetts. She was also a civil litigation attorney in private practice. Judge McNamara has a bachelor’s degree from Cornell University, a master’s degree from the University of Chicago, and a juris doctor degree from Northeastern University.

En Banc Federal Circuit Extends Law Of Joint Infringement Beyond Principal-Agent Relationships, Contractual Arrangements And Joint Enterprise – In a unanimous per curium en banc Opinion on August 13, 2015, the Federal Circuit vacated the prior reported split panel decision in Akamai v. Limelight, Appeal Nos. 2009-1372, 1380, 1416 and 1417, holding that 35 U.S.C. § 271(a) is not limited to principal-agent relationships, contractual arrangements, and joint enterprise, as the vacated panel decision held. The en banc Court held that “an entity is responsible for others’ performance of method steps in two sets of circumstances: (1) where that entity directs or controls others’ performance, and (2) where the actors form a joint enterprise.” With respect to the ‘directs or controls’ standard, the Court held that it continues to consider general principles of vicarious liability, stating: “In the past, we have held that an actor is liable for infringement under Section 271(a) if it acts through an agent (applying traditional agency principles) or contracts with another to perform one or more steps of a claimed method.” However, the Court concluded that, on the facts of this case, liability under Section 271(a) “can also be found when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance,” citing Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd.,545 U.S. 913, 930 (2005) (stating that an actor “infringes vicariously by profiting from direct infringement” if that actor has the right and ability to stop or limit the infringement). In those circumstances, the third party’s actions are attributed to the alleged infringer such that the alleged infringer becomes the single actor chargeable with direct infringement. With respect to “joint enterprise,” the Court held that “where two or more actors form a joint enterprise, all can be charged with the acts of the other, rendering each liable for the steps performed by the other as if each is a single actor.” A “joint enterprise” requires proof of: “(1) an agreement, express or implied, among the members of the group; (2) a common purpose to be carried out by the group; (3) a community of pecuniary interest in that purpose, among the members; and (4) an equal right to a voice in the direction of the enterprise, which gives an equal right of control.” The Court left open the door to “other factual scenarios [that] may arise which warrant attributing others’ performance of method steps to a single actor.”

Federal Circuit Affirms Non-Infringement Of Standard-Essential DVD Patents – In another case where claims of indirect infringement failed absent proof of direct infringement by downstream users, on August 17, 2015, in JVC Corp. v. Nero, Inc., No. 2014-1011, the U.S. Court of Appeals for the Federal Circuit affirmed the grant of summary judgment of non‑infringement of JVC’s standard-essential patents. The Federal Circuit concluded that the U.S. District Court for the Central District of California correctly held that JVC could not show indirect infringement by Nero and Arcsoft, Inc. arising from the sale of software to end users of DVD and Blu-ray discs. JVC did not proffer evidence of specific direct infringement by any end user. Instead, JVC’s theory of infringement rested on the theory that the defendants’ software “must practice the [p]atents because the [] software is used in conjunction with the standards-compliant DVD or Blu-ray” discs. The Federal Circuit affirmed the district court’s reasoning that, because the patent claims were embodied by the standards-compliant discs, direct infringement was negated by the “extensive licensing program” associated with those discs: “JVC cannot have it both ways—either the Patent is essential and licensed or JVC cannot rely on the standards to show infringement[.]” The Federal Circuit vacated the district court’s grant of summary judgment on the alternative ground that end users’ use of the accused software with licensed discs was subject to the affirmative defense of patent exhaustion, finding that the record was too “sketchy” to establish that the exhaustion doctrine applied.

IPEC Calls For Comments On The Development Of A Joint Strategic Plan On IP Enforcement – On September 1, 2015, the U.S. Intellectual Property Enforcement Coordinator (“IPEC”) published a notice in the Federal Register soliciting comments on its third Joint Strategic Plan On Intellectual Property Enforcement. The plan is expected to cover the three-year period covering 2016-19. The Joint Strategic Plan has a decidedly international focus. In particular, the objectives of the Joint Strategic Plan include disrupting and eliminating infringement networks in the U.S. and other countries; strengthening the capacity of other countries to protect and enforce IP rights; reducing the number of countries that fail to enforce IP rights effectively; assisting other countries to more effectively enforce IP rights; and protecting IP rights in other countries. IPEC requests recommendations on improving the U.S. government’s IP enforcement efforts by means of legislation, executive order, Presidential memorandum, regulation, guidance, or other executive branch action. IPEC also solicited data and other information that would support specific recommendations. Comments are due by October 15, 2015.

 

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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