Post-Investigation Invalidity Challenge Is Not a Changed Condition Permitting Rescission of an ITC Exclusion Order

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MAYBORN GROUP, LTD., MAYBORN USA, INC. v. INTERNATIONAL TRADE COMMISISION

Before Lourie, Linn, and Wallach. Appeal from the U.S. International Trade Commission.

Summary: An invalidity challenge, raised after the close of an ITC investigation, is not a changed condition under 19 U.S.C. § 1337(k)(1) for which the ITC has authority to rescind a general exclusion order.

The ITC issued a general exclusion order (“GEO”) blocking importation of beverage containers covered by the Complainant’s patent. Mayborn was not a party to the investigation, but later petitioned the ITC for rescission of the GEO, raising invalidity challenges to the patent under 35 U.S.C. §§ 102 and 103. The ITC denied Mayborn’s petition for rescission on the grounds that an invalidity challenge was not a changed condition sufficient for rescission and that it lacked statutory authority to consider such challenges outside an open investigation. Mayborn appealed.

The Federal Circuit held the ITC correctly denied Mayborn’s petition for rescission on two independent grounds. First, under statute, the ITC may only adjudicate patent validity when an invalidity defense is raised by a respondent in the course of an investigation or enforcement proceeding, and Mayborn was not a party to any such proceeding. Second, the Federal Circuit held that, unlike a subsequent judgment of invalidity, the mere raising of an invalidity defense is not a “changed condition” under 19 U.S.C. § 1337(k)(1), and thus, not a proper basis for a petitioner to seek rescission or modification of a GEO. Finally, while the Federal Circuit acknowledged a public interest in issues of patent validity, that public interest did not present a changed condition permitting the ITC to rescind the GEO.

The Federal Circuit affirmed the ITC’s denial of Mayborn’s petition for rescission of the GEO.

Editor: Paul Stewart

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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