IP News

As to the ITC's LEO, the court determined that, under 35 U.S.C. '1337(d), the ITC's authority to issue exclusionary orders is limited to “persons determined by the Commission to be in violation of this section” unless 1) a general exclusion from entry of articles is necessary to prevent circumvention or an exclusion order limited to products or named persons; or 2) there is a pattern of violation of this section and it is difficult to identify the source of infringing goods. The Federal Circuit rejected Broadcom's argument that an infringing article is excludable under an LEO regardless of the importer, reasoning that such an interpretation would render redundant the statutory language requiring the importer to be in violation of the statute. Instead, the court determined that the ITC can only issue LEOs excluding from importation the violating products of named respondents unless the heightened requirements for a general exclusionary order are met.

Matthew Berkowitz is an associate in the New York office of Kenyon & Kenyon LLP.

Carlsbad Technology

On Oct. 14, 2008, the Supreme Court granted certiorari in Carlsbad Technology, Inc. v. HIF Bio, Inc., 07-1437.

The question presented for the Supreme Court's review is as follows:

In Carnegie-Mellon Univ. v. Cohill , 484 U.S. 343, 357 (1988), this Court held that district courts could remand removed claims upon deciding not to exercise supplemental jurisdiction under 28 U.S.C. '1367(c). However, in Powerex Corp. v. Reliant Energy Servs., Inc. , 127 S. Ct. 2411, 2416 (2007), the Court stated that “it is far from clear ' that when discretionary supplemental jurisdiction is declined the remand is not based on lack of subject-matter jurisdiction for purposes of '1447(c) and '1447(d)” and noted that “[we] have never passed on whether Cohill remands are subject-matter jurisdictional for purposes of post-1988 versions '1447(c) and '1447(d).”

Construing Powerex as leaving the question open, the Federal Circuit held that a remand based on declining supplemental jurisdiction can be colorably characterized as a remand based on lack of subject matter jurisdiction, thus disagreeing with the nine other federal courts of appeals that have construed Cohill as distinguishing between remands for lack of subject matter jurisdiction and remands based on declining to exercise subject matter jurisdiction that already exists. Thus, this petition presents the question posed but left unanswered in Powerex that is now the subject of a direct conflict among the circuits:

1. Whether a district court's order remanding a case to state court following its discretionary decision to decline to exercise the supplemental jurisdiction accorded to federal courts under 28 U.S.C. '1367(c) is properly held to be a remand for a “lack of subject matter jurisdiction” under 28 U.S.C. '1447(c) so that such remand order is barred from any appellate review by 28 U.S.C. '1447(d).

Exclusionary Orders

In Kyocera Wireless Corp. v. International Trade Commission, 2007-1493, 1494, 1495, 1496, 1497, 1498, 1499, 1514, 1573, 2008-1004, 1009, 1010, 1012, 1013, 1015, 1018, 1019 (Fed. Cir. Oct. 14, 2008), the Federal Circuit reversed and remanded an ITC exclusionary order that covered non-respondent wireless manufacturers who incorporated an infringing chip into their wireless products.

On May 19, 2005, Broadcom Corp. (“Broadcom”) brought a complaint against Qualcomm Inc. (“Qualcomm”) in the U.S. International Trade Commission (“ITC”), alleging that certain Qualcomm chips infringed Broadcom's U.S. Patent 6,714,983 (“the '983 patent”) when programmed to enable certain battery-saving features. Broadcom did not name as respondents those wireless device manufacturers that incorporated Qualcomm's chips and who programmed the same for the aforementioned battery-saving features.

The ITC found Qualcomm liable for inducing infringement. As a remedy, the ITC issued a limited exclusion order (“LEO”) against the importation of all downstream products containing the accused technology. The LEO covered products by wireless device manufacturers that were not respondents to Broadcom's ITC complaint. Prior to issuing the LEO, the ITC heard testimony from Qualcomm, Broadcom, and several intervenors (whose participation was limited to the remedy phase). Qualcomm and other wireless device manufacturers appealed the ITC's decision.

The Federal Circuit affirmed the ITC's finding that the '983 patent is valid, but vacated and remanded the ITC's determination of induced infringement and its LEO. With regard to the inducement finding, the court noted that in DSU Med. Corp. v. JMS Co. , 471 F.3d 1293, 1306 (Fed. Cir. 2006) (en banc review of intent requirement), the Federal Circuit held that “the inducer must have an affirmative intent to cause direct infringement.” In the instant case, the court noted that the ITC had released its initial determination before the ruling in DSU, and had applied the incorrect standard, requiring only “a showing of either general or specific level of intent.”

As to the ITC's LEO, the court determined that, under 35 U.S.C. '1337(d), the ITC's authority to issue exclusionary orders is limited to “persons determined by the Commission to be in violation of this section” unless 1) a general exclusion from entry of articles is necessary to prevent circumvention or an exclusion order limited to products or named persons; or 2) there is a pattern of violation of this section and it is difficult to identify the source of infringing goods. The Federal Circuit rejected Broadcom's argument that an infringing article is excludable under an LEO regardless of the importer, reasoning that such an interpretation would render redundant the statutory language requiring the importer to be in violation of the statute. Instead, the court determined that the ITC can only issue LEOs excluding from importation the violating products of named respondents unless the heightened requirements for a general exclusionary order are met.

Matthew Berkowitz is an associate in the New York office of Kenyon & Kenyon LLP.