Limited Exclusion Order Does Not Require Specific Findings as to Components

McDermott Will & Emery

McDermott Will & Emery

The US Court of Appeals for the Federal Circuit affirmed a limited exclusion order issued by the International Trade Commission (ITC) against infringing “network devices, related software and components thereof,” finding no requirement that the ITC make specific findings regarding components of the accused products. Arista Networks, Inc. v. International Trade Commission, Case No. 16-2539 (Fed Cir., Sept. 27, 2017) (Reyna, J).

The ITC instituted a § 337 investigation in response to a complaint by Cisco alleging that Arista’s imports of certain network devices, related software and components thereof infringed six of Cisco’s patents. The administrative law judge (ALJ) issued a final initial determination finding a violation with respect to three of the six asserted patents (one had been withdrawn). Cisco and Arista each asked for ITC review. In its final determination, the ITC determined that Arista infringed the asserted claims of three of the remaining five patents, and entered a limited exclusion order against imports by Arista of “certain network devices, related software and components thereof.” Arista appealed the ITC’s claim construction of a term in one of the patents and the scope of the limited exclusion order. 

The claim construction issue arose in the context of a patent that addresses a multiple dependency problem in network devices. Network devices use different specialized subsystems to perform the functions related to routing network traffic. In some prior art network devices, different subsystems carried out each network function. This required multiple dependencies between the subsystems, made common transactions cumbersome, and increased the design and development time of the subsystems. The solution provided by the patent employs a centralized database, referred to as SysDB, that allows each subsystem to be modular (i.e., capable of being easily added or removed from the network) and to operate independently to carry out its specialized functions. 

Arista sells network switches that employ a software system called Extensible Operating System (EOS). EOS includes a number of agents (software routines) that each function to handle a specific task. The agents coordinate with each other through a centralized database, also referred to as SysDB, in charge of maintaining and managing configuration information for each agent. Arista’s EOS software also monitors which agents are running. Arista imported fully assembled switches that did not have the EOS software installed. Arista loaded the EOS software abroad and tested the switches with EOS software installed. Arista then removed the EOS software before importation and then reloaded it domestically in “blank switches.” 

The ITC construed the claims as requiring “router configuration data” to be “stored in said database.” The ITC determined that under its claim construction, Arista’s accused products directly infringed the asserted claims. The ITC also found that Arista’s sale and promotion of its accused products, including the blank switches, induced infringement of the patent. Specifically, the ITC determined that the switch hardware was designed to run the infringing EOS software, thus providing a basis for induced infringement. Having found a violation, the ITC entered remedial orders that “[n]etwork devices, related software and components thereof that infringe” certain claims “are excluded from entry for consumption into the United States.” 

The parties’ claim construction dispute centered on whether the claimed “router configuration data” or “commands supplied by a user” are “stored in said database.” After affirming the ITC claim construction, the Federal Circuit agreed with the ITC determination that there was a violation of the statute.

Arista also argued that the ITC did not make specific findings that the components of its accused products contribute to or induce infringement of the Cisco patent, and thus the ITC exceeded its authority to regulate “articles that infringe.” The Federal Circuit disagreed, finding that the ITC sufficiently articulated its findings that the components of Arista’s accused products induce infringement of the patent. The ITC found that Arista’s “switch hardware is designed to run the EOS software containing Sys[DB] and is run each time EOS is booted.” Although the ITC opinion did not separately define “switch hardware,” the ALJ in the final initial determination defined it separately, noting that “Switch hardware . . . includes all the individual components, such as a processor, memory, CPU card, chassis, switch card, and fan modules[.]” The ITC expressly adopted the final initial determination’s findings that were consistent with its opinion. Thus, the Court found that the exclusion order properly bars the importation of components of Arista’s infringing products. The Court relied on its 2015 en banc decision in Suprema. v. Int’l Trade Comm’n (IP Update, Vol. 18, No. 10), which explained that the ITC’s interpretation that the phrase “articles that infringe” covers goods that were used by an importer to directly infringe post-importation as a result of the seller’s inducement is reasonable.

The Federal Circuit noted that the ITC has “broad discretion in selecting the form, scope, and extent of [a] remedy, and judicial review of its choice of remedy necessarily is limited,” and that it will not interfere in an ITC remedy determination unless “the remedy selected has no reasonable relation to the unlawful practices found to exist.” The Court determined that blocking imports of articles that induce patent infringement has a reasonable relationship to stopping unlawful trade acts, and therefore found no error in the ITC’s limited exclusion order.


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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