Complainants in ITC Proceeding Permitted to Drop Patent from Investigation Over Objection from Respondents that Complainants Committed Inequitable Conduct before the Commission

July 12, 2012

In May 2012, the Complainants in this ITC proceeding, Standard Innovation (US) Corp. and Standard Innovation Corporation ("SIC") filed a motion to terminate the Investigation in part with respect to U.S. Patent No. D605,779 (the "'779 patent"). SIC filed the motion seeking to withdraw its allegations with respect to the '779 patent in order to streamline the investigation and to conserve the resources of the parties, the Administrative Law Judge, and the Commission. The Respondents opposed the motion.

In analyzing the motion, the Administrative Law Judge first considered the procedural basis for the motion: "A complaint can seek partial termination of an investigation by withdrawing asserted claims or asserted patents pursuant to Commission Rule 210.21(a)(1). See Certain Tool Handles, Tool Holders, Tool Sets, Components Therefore, Inv. No. 337-TA-483, Order No. 7 (Apr. 22, 2003) (granting motion for partial termination as to certain claims where complainant 'determined not to proceed with the investigation as to [certain claims], on the ground that a reduction in the number of patent claims in a more expeditious manner and will also reduce the time and resources required from all of the parties and the administrative law judge to proceed with the investigation'). In the absence of extraordinary circumstances, such partial termination will be granted. Id. Moreover, while good cause need not be shown in support of a complainant's voluntary request to withdraw patent claims from an investigation where withdrawal would serve to ensure resolution of the issues remaining in the investigation in an orderly fashion.' Certain Data Storage Systems and Components Thereof, Inv. No. 337-TA-471, Order No. 21 (Oct. 8, 2002) ('The withdrawal of 64 claims will narrow and focus the issues in this investigation and allow all parties to concentrate their efforts on matters about [which] there is true controversy.')"

In opposition to the motion, the Respondents argued that the possibility of inequitable conduct on the part of the complainant may be a basis for denying a motion for termination and alleging that SIC committed inequitable conduct before the Commission. The Respondents asserted that if the motion to terminate was denied, then they would promptly file a motion for summary judgment that the ''779 patent is invalid.

The Administrative Law Judge was not persuaded: "The only support offered by the Objecting Respondents for their requests is Order No. 16 in Certain Vehicle Security Systems. In that order, the ALJ recognized 'the public interest in not expending further public resources in conducting a hearing when the complainant desires to withdraw the complaint outweighs the respondents' demand for a hearing...' However, he ALJ determined the facts in that Investigation did not support an immediate termination due to pending motions for summary determination and evidentiary sanctions. Here, the Objecting Respondents have not filed similar motions such that I could find 'extraordinary circumstances' sufficient to warrant denial of SIC's motion. Further, the deadline for filing motions for summary determination has passed. See 19 C.F.R. 210.18(a)."

Accordingly, the Administrative Law Judge found that there were "no extraordinary circumstances that prevents the partial termination of this Investigation. Partial termination of the Investigation is in the public interest, as public and private resources will be conserved."

In the Matter of Certain Kinesiotherapy Devices and Components Thereof, Inv. No. 337-TA-823 (Administrative Law Judge Thomas B. Pender) (June 28, 2012)


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