On Remand, Panel Affirms ITC Finding of Section 337 Violation - Suprema, Inc. v. International Trade Commission

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In a non-precedential remand decision, the original panel in the case of Suprema v. International Trade Commission affirmed the International Trade Commission’s finding that appellant Suprema violated § 337 by inducing infringement of intervenor Cross Match Technologies’ patents. Suprema, Inc. v. International Trade Commission, Case No. 12-1170 (Fed. Cir., Sept. 14, 2015) (O’Malley, J.) (Suprema III) (non-precedential).

By way of background, in an 2013 opinion, a panel of the Federal Circuit reversed a finding by the ITC that Suprema had violated § 337 by inducing infringement of intervenor Cross Match’s patents, finding that the language of § 337 did not provide the ITC with jurisdiction in a case where the underlying act of infringement did not take place until after importation. See IP Update, Vol. 16, No. 12 (Suprema I). The full Federal Circuit reheard the case en banc, and by a 6-4 vote reversed the panel opinion, finding that § 337 was ambiguous, that the ITC had interpreted § 337 as granting jurisdiction, and that its interpretation of its enabling statute was entitled to Chevron deference. See IP Update, Vol. 18, No. 8 (Suprema II).

On remand, the Suprema III panel found that the Commission’s findings were supported by substantial evidence. First, the panel found that there was no infringement of one Cross Match patent and direct infringement by Suprema of a second patent. For a third patent, the panel upheld the Commission’s finding of induced infringement, agreeing that the requisite knowledge of the patent, or willful blindness thereof, could be implied from the fact that Suprema was aware of the Cross Match first patent, which was both related to and mentioned the application that matured into the third patent. Despite Suprema’s claim that it had never checked to see if the third patent’s parent application had ever issued, the panel noted that the patent had already issued at the time Suprema became aware of the Cross Match patent. As such, “a word search likely would have identified both patents.” The panel also noted that “the record is replete with evidence of Suprema’s efforts in aiding and abetting Mentalix to adapt . . . Suprema’s imported scanners” to practice the third patent and that Suprema’s failure to obtain an opinion of counsel was further evidence of its state of mind.

Practice Note: In dicta, the panel noted a concern by amici that the Commission’s opinion placed on respondents a duty to ensure that their customers would not infringe a patent, noting that even though it found for the complainant, it was “not unmindful of these concerns” and limiting its holding to the facts in this case.

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