Patent Licensing Satisfies Domestic Industry Requirement for Section 337 Action: Federal Circuit | Practical Law

Patent Licensing Satisfies Domestic Industry Requirement for Section 337 Action: Federal Circuit | Practical Law

In InterDigital Communications, LLC v. International Trade Commission, the US Court of Appeals for the Federal Circuit held that licensing activities alone are sufficient to support a Section 337 action even where no domestic party manufactures the patented products.

Patent Licensing Satisfies Domestic Industry Requirement for Section 337 Action: Federal Circuit

by PLC Intellectual Property & Technology
Published on 11 Jan 2013 • USA (National/Federal)
In InterDigital Communications, LLC v. International Trade Commission, the US Court of Appeals for the Federal Circuit held that licensing activities alone are sufficient to support a Section 337 action even where no domestic party manufactures the patented products.
In its January 10, 2013 decision in InterDigital Communications, LLC v. International Trade Commission, the Federal Circuit denied the intervenor's, Nokia Inc. and Nokia Corporation (Nokia), petition for rehearing en banc of its earlier decision where it held that InterDigital's patent licensing activities satisfied the domestic industry requirement for a Section 337 action even where no domestic industry manufactures the patented product.
The Federal Circuit issued a new opinion with its order denying the petition and addressed the domestic industry requirement. In the new opinion, the Federal Circuit reviewed the legislative history of Section 337 of the Tariff Act of 1930 and International Trade Commission (ITC) precedent and concluded that a party is entitled to seek relief under Section 337 as long as:
  • The patent covers the article that is the subject of the exclusion proceeding.
  • The party seeking relief can show that it has a sufficiently substantial investment in the exploitation of the intellectual property, such as by licensing.
The Federal Circuit explicitly stated that it is not necessary that the either the complainant or any other domestic party manufacture the patented product.
In this case the Federal Circuit noted that InterDigital satisfied the domestic industry requirement because, between 1993 and 2006, InterDigital:
  • Invested approximately $7.6 million in salaries and benefits for employees engaged in its licensing activities.
  • Received almost $1 billion in revenues from portfolio licenses relating to its cellphone technology.
  • Substantially invested in the research and development that led to the patents in suit.