On August 6, 2013, the International Trade Commission (the “Commission”) issued a notice in Certain Products Having Laminated Packaging, Laminated Packaging, and Components Thereof (Inv. No. 337-TA-874). 

In the notice, the Commission determined to review ALJ Theodore R. Essex’s July 5, 2013 Initial Determination (“ID”) finding Complainant Lamina Packaging Innovations LLC (“Lamina”) did not satisfy the economic prong of the domestic industry requirement.  On review, the Commission determined to reverse the ALJ’s findings regarding the Commission’s authority to direct the issuance of an early ID.  The Commission also determined that Lamina has not satisfied the economic prong of the domestic industry requirement.  Accordingly, the Commission terminated this investigation with a finding of no violation of Section 337. 

By way of background, Lamina alleged a violation of Section 337 in the importation into the U.S. and sale of certain products having laminated packaging, laminated packaging and components thereof that infringe one or more claims of U.S. Patent Nos. 6,207,242 and 7,348,067.  See our February 21, 2013 post for more details on Lamina’s complaint.

The Notice of Investigation in this case instructed the presiding ALJ to “hold an early evidentiary hearing, find facts, and issue an early decision, as to whether the complainant has satisfied the economic prong of the domestic industry requirement.”  Further, the ITC stated that it expected “the issuance of an early ID relating to the economic prong of the domestic industry requirement within 100 days of institution, except that the presiding ALJ may grant a limited extension of the ID for good cause shown.”  Significantly, the Notice of Investigation further noted that the “issuance of an early ID finding that the economic prong of the domestic industry requirement is not satisfied shall stay the investigation unless the Commission orders otherwise; any other decision shall not stay the investigation or delay the issuance of a final ID covering the other issues of the investigation.”  See our March 25, 2013 post for more details on the ITC’s notice of investigation.

According to the ID, on May 16, 2013, Lamina filed an objection to the Commission’s order set forth in the notice of investigation, arguing that it was “arbitrary and capricious” and not in accordance with the law.  Lamina argued that the special procedures set forth in the notice of investigation prejudiced Lamina and violated Lamina’s rights under the Administrative Procedure Act (APA).  Thus, Lamina requested that the hearing on the economic prong of the domestic industry requirement be postponed and rescheduled to take place later in the investigation and in accordance with normal ITC practice.  At the evidentiary hearing, ALJ Essex overruled Lamina’s objection and ordered the hearing to proceed. 

However, in the ID, ALJ Essex stated that upon further review, he had decided to change his ruling on Lamina’s objection to the Commission’s order.  Specifically, the ID states that “[i]n the case before the ITC, the Commission has sought to deviate from its rules to achieve a desired result; however the Commission has not articulated what the desired result is.”  Further, “[t]his deviation is without a justification that the cause of justice requires it, nor is any other explanation offered as to why the Commission has abandoned its rules.”  Thus, “[w]ithout such an explanation, and adherence to the APA, the deviation is fatal to the cause.”  Accordingly, “[a]bsent the instructions contained in the Notice in this matter, the judge would find the proceedings as conducted to be in violation of law and would proceed to hearing consistent with the rules of the ITC and APA.”

Nevertheless, ALJ Essex further stated that if the Commission should disagree with his ruling on Lamina’s objection, then he finds in the alternative that Lamina has not satisfied the economic prong of the domestic industry requirement.  See our July 15, 2013 post for more details on ALJ Essex’s ID in this matter.   

The Commission’s August 6, 2013 notice indicates that the “Commission’s reasoning in support of its determinations will be set forth more fully in a forthcoming opinion.”  

This investigation is the first one using the ITC’s new pilot program that seeks to collect facts and issue an early ruling on the domestic industry issue.  See our June 27, 2013 post for more details on the ITC’s new pilot program.