U.S. ITC reviews the ALJ’s entire initial determination in the LSI-Realtek 337 case

by Nicole Daniel

On 17 October 2013 the International Trade Commission (ITC) issued a Notice determining that it will review the final initial determination (ID) issued by the presiding administrative law judge (ALJ) of 18 July 2013 in its entirety. In his ID Judge Shaw found no infringement of LSI’s 802.11 and H.264 SEPs and rejected RAND defences.

The ITC started this investigation on 11 April 2012 based on a complaint by LSI Corporation and Agere Systems Inc. (collectively LSI). In this complaint violations of section 337 of the Tariff Act of 1930, by reason of infringement of various claims of US patents were alleged. The ITC’s notice of investigation named a number of respondents, referred to here as Funai and Realtek.

On 18 July 2013 the ID was issued by the ALJ. The ALJ found a violation of section 337 as to certain audiovisual components and products containing such, namely claims 1, 5, 7-11 and 16 of the ‘087 patent. However, the ALJ found no violation of section 337 in connection to any claims regarding the ‘958, the ‘867 and the ‘663 patents. The patents were not invalid and the domestic industry requirement for the patents was satisfied. Furthermore, the ALJ rejected equitable, reasonable and non-discriminatory (RAND) defenses.

On 31 July 2013 the ALJ then made recommendations for appropriate remedies and for requiring the posting of a bond in case the ITC should find a violation of section 337.

On 5 August 2013 the LSI and Funai filed their petitions for review of the final ID and Realtek filed a contingent petition for review of the final ID.

The ITC has decided to review the ALJ’s final ID in its entirety. The Notice requests additional information from the parties about specific issues in the final ID, e.g. evidence of direct infringement. It further asks for “any record evidence of the standard essential nature of the ‘663, the ‘958 and the ‘867 patents”.

Additionally, the ITC seeks written submissions addressing public interest factors since the review could find a violation of the alleged SEPs and a remedy must consider public interest factors.

The information the ITC is seeking seems to be directed at information which Froman, the US Trade Representative, found lacking in the ITC’s exclusion order in the Samsung-Apple case. He requested the ITC to ask the parties to develop a comprehensive factual record regarding the standard-essential nature of the patent in question and information on the presence or absence of patent hold-up or reverse hold-up.

On 1 November 2013 written submissions from the parties and other interested parties were due and according to the Corrected Notice reply submissions were due on 12 November 2013.