Recently Introduced Bill Would Limit ITC 'Domestic Industry by Subpoena'

Section 337 of the Smoot-Hawley Tariff Act of 1930, the ITC's enabling statute, empowers the ITC to handle these patent infringement disputes, though not all patent infringement disputes qualify. Section 337 includes what is known as the "domestic industry" requirement — a requirement that the patent holder seeking to enforce its patent rights at the ITC must establish that it contributes to industry in the U.S. related to those patent rights. The purpose of this requirement as articulated by Congress is to "preclude holders of U.S. intellectual property rights who have no contact with the United States other than owning such intellectual property rights from utilizing section 337." S. Rep. 100-71, 100^th Cong., 1^st Sess., at 129 (1987).

Under current law, the domestic industry requirement can be satisfied in situations in which the patent holder itself does not have U.S. domestic operations, but instead licenses its patent rights to a licensee that does. The licensee's U.S. activities can satisfy the domestic industry requirement in these circumstances even if that licensee is not a willing participant in the ITC Investigation. This scenario is often referred to as "domestic industry by subpoena," because the patent holder will in these circumstances subpoena the licensee to involve the licensee in the ITC investigation and, through that subpoena, obtain discovery from that licensee regarding its U.S. operations. The patent holder then relies on that discovery to meet the domestic industry requirement.