On June 8, 2012, the International Trade Commission (the “Commission”) issued the public version of the opinion reversing the initial determination of no violation of Section 337 in Certain Ground Fault Circuit Interrupters and Products Containing Same (Inv. No. 337-TA-739).
By way of background, the Complainant in this investigation is Leviton Manufacturing Co., Inc. (“Leviton”), which alleges violation of Section 337 with respect to certain ground fault circuit interrupters and products containing the same that infringe certain claims of U.S. Patent Nos. 7,463,124 (the ‘124 patent), 7,737,809 (the ‘809 patent), and 7,764,151 (the ‘151 patent). Although the Notice of Investigation named numerous respondents, several were found in default or were terminated due to settlement, consent orders, or withdrawn allegations. The seven remaining respondents were Zhejiang Trimone Electric Science & Technology Co. Ltd. (“Trimone”), Fujian Hongan Electric Co, Ltd. (“Hongan”), TDE, Inc. (“TDE”), Shanghai ELE Manufacturing Corp., Orbit Industries, Inc., American Electric Depot Inc., and Shanghai Jia AO Electrical Co.
ALJ Bullock issued an initial determination (“ID”) on December 20, 2011 finding no violation of Section 337 on the grounds that Leviton had not sufficiently shown that a domestic industry exists with respect to the three asserted patents and/or articles protected by those patents. See our February 24, 2012 post for more details.
On February 21, 2012, the Commission issued a notice that it had determined to review the ID in its entirety and requested submissions from the parties on certain issues under review, and from the parties and the public on the issues of remedy, the public interest, and bonding. Our May 3, 2012 post contains a summary of the Commission’s findings, and the public version of the opinion discussed below provides the details underlying these findings.
The technology at issue, ground fault circuit interrupters, are the electrical outlets typically found in bathrooms and kitchens. The three asserted patents include claims directed to these devices and solve the problem of “reverse wiring,” a situation where the device is installed incorrectly and thus does not protect a user from a ground fault. The opinion includes a list of representative accused products for each respondent.
The Commission first analyzed the ALJ’s claim construction, noting that, contrary to the law, “the ALJ appeared to apply a different claim construction when analyzing the validity of certain patent claims than was applied when analyzing infringement of the same claims.”
Construction of the term “reverse wired” was determined differently from the ALJ, with the Commission relying on the “well-established doctrine of claim differentiation.” In other words, only one claim explicitly required that the device prevents electrical continuity when “reverse wired,” and thus, the other claims do not include this requirement. The Commission adopted the same constructions as the ALJ via different reasoning or found no error in the ALJ’s construction for all other claim terms. Notably, Respondents Trimone, Hongan, and TDE put forward a new claim construction of the phrase “at lease one of…and” as requiring that all elements in the list be required by the claim. The Commission found this argument to be waived as untimely and also noted that the proposed construction would be rejected.
In keeping with the ALJ’s determination, the Commission concluded that the record evidence supports a finding of infringement for all three patents. However, the Commission found that the ‘124 and ‘151 patents were invalid over the prior art, contrary to ALJ Bullock’s ID. Specifically, the ALJ had relied on the fact that the device in the Echtler reference was incapable of being reverse wired, and had read this limitation into the claims of the ‘124 patent. However, the Commission determined that the ALJ’s determination “does not apply a consistent interpretation of the patent claims” and was erroneous. Under the Commission’s claim construction, “which does not include those extraneous unclaimed features, the Echtler reference compels a finding [of anticipation].” A similar finding of anticipation was made with regard to the Bereskin reference when the “extraneous limitations” were properly not considered. The Commission found the ‘151 patent to be obvious over the combination of Bereskin with a secondary reference, but found all other combinations of prior art to be unpersuasive. Similarly, the Commission agreed with the ALJ on the validity of the patents in the face of enablement, inequitable conduct, and prosecution laches challenges, and confirmed the validity of the ‘809 patent.
Regarding domestic industry, the Commission reversed the ALJ’s determination that Leviton had not satisfied both prongs of the domestic industry requirement. The Commission agreed with the ALJ that Leviton’s products that practice particular claims of the asserted patents could be relied on to meet the requirements of the technical prong. However, the ALJ’s determination that Leviton failed to meet the economic prong was found to be based on an erroneous interpretation of the law. Specifically, ALJ Bullock based the ID on the assumption that investments relied on to meet the economic prong must be attributable to individual patents on a patent-by-patent basis. The Commission Investigative Staff (“OUII”) submitted briefing explaining that the economic prong of the domestic industry requirement is met by investments relating to articles that practice the patents, “rather than by trying to determine how much of each individual product can be allocated to each patent.” The Commission determined that, in view of the evidence, Leviton had shown significant investments in infrastructure, equipment, and employment of labor and capital with respect to at least two products, one of which was shown to practice claim 1 of the ‘809 patent, the only asserted patent found to be valid. Thus, the Commission determined that Leviton met the domestic industry requirement, and there was a violation of Section 337 in relation to articles protected by the ‘809 patent.
With respect to remedy, the Commission found that a general exclusion order is necessary since two of the respondents “may be attempting to circumvent the limited exclusion order issued in Inv. No. 337-TA-615” and “some respondents and potential manufacturers have a propensity and ability to change names and corporate forms.” Furthermore, cease and desist orders prohibiting importing, selling, marketing, distributing, offering for sale, and advertising such ground fault circuit interrupters and products containing same were imposed. Lastly, the Commission determined that a bond of $0.25 per unit for temporary import of the articles in question during the Presidential review period should be imposed.