The United States International Trade Commission (USITC) is not a Federal court – in many ways, it’s better than a Federal court where U.S. patents are concerned.
The USITC is a U.S. administrative agency charged with, among other things, handling claims by a U.S. patent owner that imported products infringe a U.S. patent. To trigger USITC review, the patent owner will file a complaint with the six-member USITC. If the USITC votes to investigate, it assigns an administrative law judge. The administrative law judge holds a full trial with evidence, witnesses, a cross examination, and issues an initial determination. The USITC can accept or reject the administrative law judge’s initial determination as its final determination. The President can reverse the USITC’s final determination if he or she so chooses. The losing party can appeal the USITC’s final determination to Federal court.
The USITC’s final determination is analogous to a Federal judge’s final decision in a patent case. What sets patent infringement before the USITC apart from Federal court patent infringement are the remedies that the USITC may order. In patent infringement litigation in Federal court, the Federal judge may order that an infringer pay money damages, but in general, Federal judges do not order infringers to stop infringing.
The situation is reversed before the USITC. The USITC can issue orders prohibiting importation of infringing goods, can issue ‘cease and desist’ orders and can require the infringer to post a bond to ensure that it complies with the order. When everything is made overseas, that’s as good as a court order prohibiting infringement. The USITC cannot impose money damages for infringement.
This brings us to the case of Sonos and Google. In January, 2020, Sonos filed a complaint with the USITC that Google infringed Sonos patents relating to smart speakers. The infringing features relate to digital assistants and to controlling volume across several speakers simultaneously. The USITC authorized an investigation and, after a trial, issued a final determination that Google infringed the Sonos patents. The USITC went on to prohibit Google from importing the infringing products, issued a ‘cease and desist’ order and required Google to post a money bond.
In response to the USITC action, Google disabled the offending features of its smart speakers, stopping the infringement. Google customers are reportedly unhappy with the change, with some asking for refunds.
A court order stopping infringement could do no better and infringement is stopped. This is not a case of a U.S. company vs a foreign evildoer. Both Sonos and Google are U.S. companies based in the U.S., so it’s a U.S. company vs. a U.S. evildoer. Sono’s trip before the USITC also does not preclude it from going to Federal court for infringement damages. In fact, Sonos and Google are litigating in Federal court right now.
In short, for imported products, the USITC provides an avenue for a U.S. patent owner to shut down infringement.
— Robert Yarbrough, Esq.