Second Investigation Under 100-Day Pilot Program for Early Termination

On March 12, the Commission instituted Investigation No. 337-TA-949 based on the complaint filed by Andrea Electronics Corp. (“Andrea”).  See Certain Audio Processing Hardware and Software and Products Containing Same; Institution of Investigation, 80 Fed. Reg. 14159 (March 18, 2015).  See our prior blog entry for discussion of Andrea’s complaint.  Notably, the Notice of Institution directs the Administrative Law Judge (“ALJ”) assigned to the investigation to issue an initial determination (“ID”) within 100 days regarding whether Andrea has standing to assert each of the asserted patents.

In pre-institution correspondence, proposed respondents Hewlett-Packard Company and Dell Inc. questioned whether Andrea’s publicly disclosed business arrangement with Fortress Investment Group resulted in Andrea no longer owning the requisite bundle of rights in its patents.  The respondents had also requested that the issue of whether the complainant satisfied the domestic industry requirement be addressed by the ALJ under the 100 day procedure; however, the Commission only designated the standing issue for expedited treatment in the Notice of Institution.

This is the second investigation under the pilot program announced by the Commission in June 2013 aimed at expediting decisions on potentially dispositive issues in Section 337 investigations.  See the ITC’s news release regarding the pilot program.  The first investigation in the 100 day pilot program was Certain Products Having Laminated Packaging, Laminated Packaging, and Components Thereof, Inv. No. 337-TA-874, in which ALJ Theodore R. Essex examined the economic prong of the domestic industry requirement and concluded the requirement had not been met.  However, in his Initial Determination, ALJ Essex questioned the Commission’s use of the pilot program and asserted that the Commission lacked authority under ITC rules or the Administrative Procedure Act to direct issuance of an early ID under the program.  The Commission reviewed ALJ Essex’s ID and held that it does have authority to implement the pilot program.  For further discussion of the ITC’s pilot program, see our prior client alert.

Overall, this remains an investigation to watch in light of the Federal Circuit’s pending en banc decision in Suprema and its potential effect on induced infringement claims at the ITC, as well as further guidance on the use and operation of the 100 day pilot program.  The Investigation has been assigned to ALJ Thomas B. Pender.