In the first investigation subject to a pilot program, the International Trade Commission (ITC) has agreed with an administrative law judge (ALJ) that a company alleging infringement of its patents for laminated packaging by the importers of liquor, wine, toys, electronics, and cosmetics failed to show that it had a domestic industry that would be harmed by the alleged infringement. In re Certain Prods. Having Laminated Packaging, & Components Thereof, No. 337-TA-874 (ITC, decided August 6, 2013). Several alleged infringers, including Camus Wine & Spirits Group of Cognac, France, were terminated from the investigation before it was resolved on the basis of settlement agreements with claimant Lamina Packaging Innovations, Inc. of Longview, Texas.

ITC has the authority to bar imports of products deemed harmful to a domestic industry and announced earlier this year that it would test expedited procedures in cases alleging unfair practices in import trade. Under the program, ITC identifies potentially dispositive issues and directs the assigned ALJ to rule on those issues early in an investigation through expedited factfinding and an abbreviated hearing limited to those issues. While ITC upheld the ALJ’s determination that the complainant did not satisfy the economic prong of the domestic industry requirement, it reversed the ALJ’s findings that ITC may have violated the Administrative Procedure Act by failing to publish information about the pilot program ahead of time and directing the issuance of an initial ALJ determination within 100 days in this case.

Lamina reportedly objected to the expedited proceeding and indicated before ITC ruled that the company would consider taking an appeal to the Federal Circuit Court of Appeals. According to some commentators, who have watched the case closely, early action on threshold dispositive issues, such as whether a patent holder has invested in factories or hired a significant workforce thus establishing a domestic industry, could deter litigation filed by companies referred to as “patent trolls” or “patent assertion entities” that are in the business of buying and asserting patents and do not themselves use the patents to make things. See ITC News Release, June 24, 2013; AmLaw Litigation Daily, July 10 and August 12, 2013.