ITC Litigation: The Section 337 Investigation Timeline

We previously covered the basics of a Section 337 investigation,[1] including the timing and prerequisites for filing a Complaint.[2] Unlike in district court, however, the filing of a Section 337 ITC Complaint triggers a series of actions several of which occur before the International Trade Commission ("ITC") votes on whether to institute an investigation.

Below, we chronologically summarize a typical Section 337 investigation schedule, which, if instituted, will take about a year before the Commission makes its final determination on whether violation exists and warrants relief.[3]

Filing of the ITC complaint and public interest statement. As discussed in our prior post, the complaint and accompanying papers is the first docket entry of any Section 337 action. One of these papers is the complainant's statement about Section 337's public interest factors.

Publication in Federal Register of Notice of Filing of Complaint and Solicitation of Comments regarding the Public Interest. About six calendar days after filing the complaint, a notice of the filing and a request for submission of statements concerning the public interest, as well as "other issues" (e.g., sufficiency of the complaint, or whether to use an expedited proceeding on a single dispositive issue), is published in the Federal Registrar.[4]

Submission of Respondent(s)' and Third Party Responses to Complainant's Public Interest Statement. Eight days from publication of the notice in the Federal Registrar, respondents and any third parties can submit statements regarding the public interest and other issues.[5]

Complainant's Reply to Public Interest Statement. Within three days of any public interest statements, the complainant may submit a corresponding reply.[6]

Commission's Decision on Institution. Within 30 days from the filing of a complaint, the Commission will issue a decision as to whether it will institute a Section 337 investigation.

Service of Complaint on Respondent(s). When the Commission issues a Notice of Institution of Investigation, it serves via express delivery the complaint and accompanying papers on all named respondents. Currently, because of the Covid-19 outbreak, complainants must serve these papers on each respondent and provide proof of service.[7]

Publication in Federal Register of Notice of Institution of Investigation. About six days after the Commission's Notice of Institution of Investigation, the Notice of Institution is published in the Federal Register.

Fact Discovery Opens. After the publication of the Notice of Institution of Investigation, discovery can start. Discovery typically lasts about six months.[8]

Response to Discovery Requests. Parties have ten days, starting from first business day after service, to respond to discovery requests.[9]

Response to Complaint and Notice of Investigation. After institution, a domestic respondent has 21 days from service of the complaint to file an answer, and a foreign respondent has 25 days to do the same.[10] The answer needs to include all affirmative defenses and, when available, provide statistical data regarding the quantity and value of the imported articles, among other requirements.[11]

Last Day to Seek Automatic Stay in Parallel District Court Proceedings. Thirty days after institution, or 30 days after a district court action is filed, whichever is later, if a respondent is also sued in district court on the same issues involved at the ITC (e.g., same patent claims, same trademark), then the respondent can request an automatic stay of the district court proceedings under 28 U.S.C. 1659.

Setting of Procedural Schedule. Within 45 days of institution, the Administrative Law Judge ("ALJ") to whom the investigation is assigned will issue an order setting the procedural schedule and the target date for the conclusion of the investigation (i.e., the Final Determination by the Commission on Violation and Remedy ("FD")).[12] By statute, the investigation is to be concluded "at the earliest practicable time."[13] The ALJ is required to make an initial determination ("ID") on violation and a recommended determination ("RD") on remedy, bonding, and the public interest no less than four months before the target date.[14] The exact length of time a party will have for each stage of the investigation will depend on the procedural schedule and the target date set by the specific ALJ.

Markman Hearing and Claim Construction. Where the action is based on a patent, the schedule typically sets a claim construction briefing schedule. A Markman hearing may be set during fact discovery or after it closes.

Expert Discovery. Each ALJ can set its own procedural schedules, but generally following fact discovery there is a one month period for expert discovery (this includes serving both opening and rebuttal expert reports and taking expert depositions).

Motions for Summary Determination. The procedural schedule will have a deadline for filing motions for summary determination (analogous to motions for summary judgment in district court), but which also must be filed at least sixty days before the commencement of the evidentiary hearing.[15] Typically, they are filed shortly after the close expert discovery, with only a few weeks between the two deadlines.

Witness Statements (if applicable). Certain ALJs will then have a witness statement stage of the investigation this replaces direct testimony from witnesses at the evidentiary hearing. In a witness statement investigation, parties will serve direct and rebuttal statements for all witnesses the parties plan to bring to the hearing, where the witnesses will be cross-examined live. Witness statements are served a few weeks after the end of expert discovery and about a month and half before the evidentiary hearing.

Pre-hearing Filings and Disclosures. Pre-hearing filings and disclosures, including pre-hearing briefs, motions in limine, high priority objections, exhibits, and deposition designations (if any), are then served and/or filed weeks before the evidentiary hearing. Any issues not set forth in the pre-hearing brief will be deemed waived or abandoned.

Last Day to File Counterclaims for Removal to District Court. Ten business days before the evidentiary hearing, a respondent may file counterclaims which are deemed to relate back to the date of the original Section 337 complaint. However, those counterclaims must then be immediately removed to district court.[16]

Evidentiary Hearing. Approximately eight to nine months after institution of the Investigation, the evidentiary hearing will take place. The purpose of the hearing is to enable the ALJ to take evidence, hear arguments, and determine whether a violation of Section 337 has occurred.[17]

Post-hearing Briefing. After the evidentiary hearing, the ALJ will also set the deadline for post-hearing briefing and proposed findings of fact and conclusions of law.[18] The parties usually have two weeks to serve the post-hearing submissions and then another week to file reply briefing.

Initial Determination on Violation and Recommended Determination on Remedy, Bonding, and Public Interest. The ALJ will issue an ID as to whether a violation under Section 337 exists no later than four months before the set target date for the investigation.[19] The ALJ typically also issues an RD on issues concerning relief, bonding, and the public interest on the same day.[20]

Parties' Petition for Review of ID to Commission. Within twelve days of service of the ALJ's final ID, the parties may petition the Commission for a review of the final ID.[21] The other parties may file responses to such a petition within eight days.[22] The parties will have the opportunity to address the issues in the RD at a later time, if necessary.

Supplemental Public Interest Statements. Within thirty days after service of the ALJ's RD on remedy, bond, and public interest, parties and the public may submit supplemental statements regarding the public interest factors. Supplemental statements from the parties (but not the public) are limited to five pages.[23]

Notice of Commission Determination to Review ID and Subsequent Briefing Schedule. The Commission's decision on whether to grant a petition for review is due no later than 60 days after the service of the ID.[24] If the Commission determines to review all or part of the ID, the parties will be given a briefing schedule, a list of the specific issues that are under review, and questions or topics that the Commission wants the parties to address. If at this point it is possible the Commission will issue remedial order(s), the Commission will invite the parties and public to submit comments on remedy, bond, and the public interest.

Target Date of Section 337 Investigation. The Commission will issue the FD and any applicable exclusion or cease and desist orders by the target date for the investigation, which is usually 12-16 months from the date of institution.[25] The Commission has the discretion to adopt, modify, reverse, or not review the ALJ's final ID. If no review is instituted, then the ID will automatically be adopted as the FD.[26] The Commission may also review an issue and then expressly take no position on it. In this way, the Commission does not adopt the relevant portion of the ID but does not address it in detail either.[27]

Petition for Reconsideration of Commission Determination. Within 14 days of service of the determination, any party is allowed to file a petition for reconsideration of the Commission's determination. The petition is limited, however, to new questions raised by the determination that the party has not yet had an opportunity to argue.[28]

Sixty-Day Presidential Review Period and Bonding (if applicable). If the Commission finds a violation and issues exclusion or cease and desist orders, the Commission must send its FDs and remedial orders to the President for review. The President then has sixty days to review the Commission's determination.[29] If the President does not affirmatively reject the Commission's determination, the determination automatically becomes final after the sixty days have elapsed or earlier if the President notifies the Commission of approval before the sixty days.[30] During this period, if a respondent continues to import goods found to violate Section 337, such goods may continue to be imported into the United States subject to the imposition of a bond determined by the Commission.[31]

Appeal to the Federal Circuit. Finally, a party can appeal an adverse final determination to the United States Court of Appeals for the Federal Circuit within sixty days of 1) the determination becoming final (in the event of a conclusion of no violation) or 2) the end of the Presidential Review Period (in the event of a conclusion of violation).[32] Although we have listed this last on this timeline, many initial determinations made by the ALJ during an investigation can become final, even before the target date of a Section 337 investigation. Thus, an appeal can occur before or after the target date, and multiple appeals can be made in any one investigation, depending on the FD being appealed.[33]

 

More questions? Contact the authors or visitFish's Intellectual Property Law Essentials.

[1] See "ITC Litigation: The Rise in Popularity of Section 337," May 26, 2020, available at https://www.fr.com/fish-litigation/itc-litigation-rise-popularity-section-337/.

[2] See "ITC Litigation: How Do I File an ITC Complaint?," April 22, 2020, available at, https://www.fr.com/fish-litigation/itc-litigation-how-do-i-file-an-itc-complaint/.

[3] 19 C.F.R. 210.51. Of course, this comes with the current caveat for the global Covid-19 pandemic that has upended the course of many litigations. As of now, the ITC has postponed all in-person hearingsuntil further notice or until the agency enters Phase Three of its reopening plan. USITC Response to COVID-19, USITC (June 26, 2020) https://www.usitc.gov/press_room/featured_news/usitc_response_covid_19.htm (last visited July 6, 2020). And, while the general ITC order keeps all other litigation deadlines in place, in practice parties are getting those deadlines rescheduled in view of the hardship COVID-19 restrictions present.

[4] 19 C.F.R. 210.8(c).

[5] 19 C.F.R. 210.8(c).

[6] 19 C.F.R. 210.8(c)(2).

[7] 85 Fed. Reg. 15798 (Mar. 19, 2020).

[8] 19 C.F.R. 210.28, 210.29, 210.30.

[9] 19 C.F.R. 201.14, 210.28, 210.29, 210.30.

[10] 19 C.F.R. 201.16(e), 210.11(a), 210.13. The response due dates calculated here add additional time to the 20-day response period for service by express delivery, set forth in 19 C.F.R. 201.16(e).

[11] 19 C.F.R. 210.13. A respondent may assert counterclaims up until ten business days before the evidentiary hearing. 19 C.F.R. 210.14(e). A respondent who asserts a counterclaim must file a notice of removal of the counterclaim with any district court in which venue for the counterclaim exists. Id.

[12] 19 C.F.R. 210.51(a).

[13] 19 U.S.C. 1337(b)(1). Technically, the RD on remedy and bond is due fourteen days after the ID on violation (19 C.F.R. 210.42(a)(1)(ii)), but as a practical matter most ALJ's issue the two determinations simultaneously.

[14] 19 C.F.R. 210.42(A)(1).

[15] 19 C.F.R. 210.18(a).

[16] 19 C.F.R. 210.14; 19 U.S.C. 1337(c).

[17] 19 C.F.R. 210.36.

[18] 19 C.F.R. 210.40. As a practical matter, the ALJs do not require parties to file a statement of proposed findings of fact and conclusions of law that is separate from the post-hearing briefs.

[19] 19 C.F.R. 210.42(a)(1).

[20] 19 C.F.R. 210.42(a)(1)(ii).

[21] 19 C.F.R. 210.43.

[22] 19 C.F.R. 210.43.

[23] 19 C.F.R. 210.50(a)(4)(i).

[24] 19 C.F.R. 210.42(h)(2).

[25] 19 C.F.R. 210.51.

[26] 19 C.F.R. 210.42(h)(2).

[27] The Federal Circuit affirmed the Commission's authority to take no position on an issue in Beloit Corp. v. Valmet Oy, 742 F.2d 1421 (Fed. Cir. 1984), cert. denied, 472 U.S. 1009, 105 S.Ct. 2706, 86 L.Ed. 2d 721 (1985). Consequently, "Beloit" has become a verb among Section 337 practitioners as in "The Commission Beloited that issue."

[28] 19 C.F.R. 210.47.

[29] While the statute refers to review by the President, since 2005 this function has been delegated to the Office of the United States Trade Representative ("USTR"). 70 Fed. Reg. 43251 (July 26, 2005).

[30] See 19 U.S.C. 1337(j).

[31] 19 U.S.C. 1337(e)(1).

[32] 19 U.S.C. 1337(c).

[33] See Allied Corporation v. United States International Trade Commission, 782 F.2d 982, 984 (Fed. Cir. 1986).