Complainants Canon, Inc., Canon U.S.A., Inc. and Canon Virginia, Inc. ("Canon") filed a motion for summary determination that Canon satisfied the economic prong of the domestic industry requirement for each of the patents in the investigation. Canon asserted that it satisfied "[t]he economic prong of the domestic industry requirement based on all three subsections of § 13379a)(3). Mem. At 1. Namely, Canon argues that its significant investment in plant and equipment, its significant employment of labor and capital, and its substantial investment in the exploitation of the asserted patents, including engineering and quality assurance activities, each independently meet the economic prong of the domestic industry requirement."
As explained by the administrative law judge, "[i]n patent-based proceedings under section 337, a complainant must establish that an industry "relating to the articles protected by the patent...exists or is in the process of being established" in the Untied States. 19 U.S.C. § 1337(a)(2). Under Commission precedent, this domestic industry requirement of Section 337 consists of a "technical prong" and an "economic prong." Certain Variable Speed Wind Turbines and Components Thereof, Inv. No. 337-TA-376, Comm'n Op. at 7 n.13 (Oct. 28, 1997) The "technical prong" of the domestic industry requirement is satisfied when the complainant's activities relate to an article protected by the patent. 19 U.S.C. § 1337(a)(2). The economic prong is satisfied by meeting any one of three criteria with regard to articles protected by each of the patents at issue: (A) significant investment in plant and equipment; (B) significant employment of labor or capital; or (C) substantial investment in its exploitation, including engineering, research and development, or licensing. 19 U.S.C. § 1337(a)(3). Given that these criteria are in the disjunctive, satisfaction of any one of them will be sufficient to meet the domestic industry requirement."
The administrative law judge found that Canon had satisfied each of the economic prong requirements for the asserted patents as a matter of law. "Canon had demonstrated that its U.S. activities related to the asserted patents satisfy each of the three prongs of 19 U.S.C. § 1337(a)(3). As previously noted, it would be sufficient to establish any one of these criteria."
In particular, the administrative law judge found that "Canon has demonstrated significant investments in plant and equipment related to the articles protected by the asserted patents." In addition, Canon had shown that it was responsible for significant employment of labor or capital in the Virginia area. Canon has also demonstrated it had substantially invested in the exploitation of the patents at issue through its engineering and quality assurance activities.
The administrative law judge also determined that a significant amount of investments in plant and equipment and labor and capital was made by Canon at its Newport New facilities and were directly related to the asserted domestic industry products.
Accordingly, the administrative law judge determined that Canon had satisfied the domestic industry requirement.
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