International Trade Commission must follow its own regulations, which provide that only an “initial determination,” not an “Order,” is subject to immediate review.
A patentee filed a complaint with the International Trade Commission to stop the importation of certain accused dental aligners. The aligners are made based on a digital data set that is customized for the patient. Ultimately, the patentee and the respondent agreed to a Consent Order, which prohibited the importation of the accused products “and any other articles manufactured in violation of the patents or trade secrets described therein.” Subsequently, the patentee filed a new complaint with the Commission, alleging that two companies were working together to provide infringing products: a Pakistani company created digital data sets and electronically transmitted them to an American company, which created the aligners.
The respondents filed a motion to terminate the proceeding, arguing that the accused conduct (importation of digital data) did not fall within the scope of the Consent Order. The ALJ denied the motion in an “Order.” By regulation, an “Order” is not subject to immediate review by the Commission. But the Commission determined that this Order constituted an “initial determination,” and thus was subject to immediate review, and reversed. Relying on two prior cease-and-desist orders that expressly referenced digital data, the Commission held that the consent order “did not contain an express provision prohibiting the electronic transmission of data.”
The Federal Circuit vacated the Commission’s decision. The ALJ’s decision was an Order, and bore none of the hallmarks of an “initial determination.” Thus, it was not subject to immediate review. Indeed, the ALJ was required by regulation to deny motions for termination by Order. Although the Commission was permitted to waive its regulations for “good and sufficient reason,” it had not done so. The court also signaled that it was skeptical of the Commission’s decision on the merits, because the two cease-and-desist orders relied upon did not indicate that it was necessary to expressly reference digital data.
A copy of the opinion can be found here.