The U.S. Court of Appeals for the Federal Circuit has held that a losing party in a Section 337 investigation may appeal any adversely decided issue, regardless of whether the International Trade Commission (ITC) actually addresses the issue upon review in its Final Determination. General Electric Co. v. International Trade Commission, Case No. 10-1223 (Fed. Cir., Feb. 29, 2012) (Rader, C. J.). In doing so, the Federal Circuit rejected the ITC’s position that any issue in the final Initial Determination (ID) on which the Commission granted to view but then took no position, is not subject to appeal.
The complainant, General Electric, initiated the underlying Section 337 investigation by filing a complaint alleging infringement of certain patents for variable speed wind turbines by the respondent, Mitsubishi . After considering the evidence presented, the administrative law judge (ALJ) determined that Mitsubishi violated Section 337 based on his findings that that none of the three asserted patents were proven invalid, that Mitsubishi infringed all three patents and that GE had established a domestic industry based on its own practice of two of the three patents. Pursuant to 19 C.F.R. § 210.45, the parties petitioned the ITC to review certain adverse aspects of the Final ID. In a “Notice of Commission Determination to Review a Final Initial Determination of the Administrative Law Judge,” the ITC indicated it would review all aspects of the Final ID, except for the issues of importation and the intent finding underlying the ALJ’s inequitable conduct determination.
After considering additional briefing on the issues that it had noticed for review, the ITC issued a Final Determination holding that one of the asserted patents was not invalid based on obviousness or written description, that two of the asserted patents were not infringed by the accused Mitsubishi turbines and that the domestic-industry requirement was not met as to any of the asserted patents. The ITC thus held that § 337 was not violated by the imported Mitsubishi turbines. The ITC, however, took no position on any other issues in its Final Determination.
When GE appealed to the Federal Circuit, it addressed issues in the ID that the ITC did not address in its Final Determination. The ITC argued to the Federal Circuit that GE had no statutory right to appeal issues that were not addressed in its Final Determination.
Under 19 U.S.C. § 1337(c), “[a]ny person adversely affected by a final determination of the Commission … may appeal such determination … to the United States Court of Appeals to the Federal Circuit.” According to the ITC, under § 1337(c), issues in an ID that are not selected for review may be appealed to the Federal Circuit, but issues selected by the full ITC for review, but then not reviewed in the Final Determination, may not be appealed. The ITC argued that this anomalous procedure was established by the Federal Circuit in Beloit Corp. v. Valmet Oy (1984). The Federal Circuit decision rejected this argument, noting that its holding in Beloit only stood for the proposition that unreviewed issues cannot be appealed by the party prevailing on those issues, but the Beloit decision did not allow the Commission to strip the right to appeal from a losing party. The Federal Circuit also rejected the ITC’s argument that the 2008 amendment to 19 C.F.R. § 210.45(c), which provides “the Commission may take no position on specific issues or portions of the initial determination of the administrative law judge,” allowed the ITC to effectively shield issues not decided by the Commission from appellate review.