ITC Monthly Wrap-Up: November 2023

This month’s International Trade Commission wrap-up focuses on the circumstances in which a complainant can amend its complaint.

In particular, on November 2, 2023, Administrative Law Judge Moore denied a complainant’s motion seeking leave to amend its complaint to add false advertising claims in the 1313 investigation. See Certain Botulinum Toxin Products and Processes For Manufacturing or Relating to Same, Inv. No. 337-TA-1313, Order No. 29 (“the 1313 Investigation”) (U.S.I.T.C. Nov. 2, 2023). Medytox, Inc. (“Medytox”), the complainant, sought to allege that respondents’ Hugel, Inc., and Hugel America, Inc. (“Hugel”), commercial statements about the origins of their Clostridium botulinum strain were false under the Lanham Act. Id. at 4. The ALJ denied the motion, finding Medytox failed to establish good cause because Medytox could have — and should have — brought its false advertising claims earlier. Id. at 7.

The fact discovery period was unusually long in Inv. No. 1313 due, in part, to the underlying technology and location of the evidence. At issue was the precise strain of the neurotoxin botulinum.¹ Identifying the strain required sophisticated DNA testing.² In addition to the amount of time required to perform the testing itself, the testing occurred in the Republic of Korea.³ Consequently, production of this evidence in the investigation required approval from the Republic of Korea’s Ministry of Trade, Industry & Energy (“MOTIE”).₄ Together, these factors led to the ALJ extending the target date to 29 months, which included an 18-month fact discovery window.⁵

Despite the extra time for fact discovery, however, complainant Medytox failed to promptly raise its false advertising claims or seek to amend its complaint earlier. Instead, Medytox first included its false advertising allegations in its contention interrogatory responses that it served on the final deadline to serve supplemental responses to burden contention interrogatories.⁶ That deadline fell on the last day of the fact discovery period.⁷ About two weeks later, Medytox filed an opposed motion to amend its complaint.⁸ In support, Medytox argued it could not have brought its false advertising claims any earlier because the falsity of the claims could not be established until the DNA testing was complete.⁹

The ALJ disagreed.¹⁰ Specifically, the ALJ found Medytox had “repeatedly accused Hugel of making false statements about the origin of its C. botulinum strain through this investigation,” even though Medytox’s allegations were based “[u]pon information and belief.”¹¹ Likewise, the ALJ recognized Medytox and its experts repeatedly argued Hugel’s statements were false throughout fact discovery.¹² In light of these disclosures, the ALJ held Medytox could have brought its false claims allegations earlier — and potentially as part of the original complaint.¹³

The ALJ’s decision in the 1313 investigation emphasizes the factual circumstances necessary to show good cause, especially when compared to the shifting allegations in Opaque Polymers investigation, Inv. No. 883. In the Opaque Polymers investigation, the initial complaint involved allegations of patent infringement.¹⁴ While the investigation was pending, however, the complainant amended its complaint to include trade secret misappropriation allegations and subsequently withdrew its patent infringement allegations.¹⁵ The ALJ in Opaque Polymers found the discovery of the trade secret misappropriation could not be discovered absent the documents and witness testimony discovered during the course of the investigation.¹⁶ And the complainants’ motion to amend the complaint occurred within weeks after discovering evidence sufficient to substantiate its suspicions.¹⁷

To conclude the November 2023 edition, the Commission also conducted its routine business. The Commission issued an opinion in Certain Pillows and Seat Cushions, Components Thereof, and Packaging Thereof, Inv. No. 337-TA-1328 (Nov. 13, 2023), in which it entered a general exclusion order. The Commission also instituted three new Section 337 investigations: Products Containing Tirzepatide and Products Purporting to Contain Tirzepatide, Inv. No. 337-TA-1377; Electronic Devices, Including Mobile Phones, Tablets, Laptops, Components Thereof, and Products Containing the Same, Inv. No. 337-TA-1376; and Mobile Phones, Components Thereof, and Products Containing Same, Inv. No. 337-TA-1375.