US ITC begins pilot to speed up disposal of patent cases

The trade agency has found that it can speed up by focusing on the dispositive issues

The U.S. International Trade Commission has launched a pilot program to test whether early rulings on identified crucial issues in some investigations could limit unnecessary litigation, saving time and costs for all sides.

One such "dispositive" issue, though not the only one, could be the existence of a domestic industry for a product, which often comes up later in the investigation.

Complainants should also be prepared to prove their case without extensive discovery on the issues, the ITC said Monday.

The move comes in the wake of concerns about unnecessary and sometimes frivolous patent disputes by "patent assertion entities," popularly known as patent trolls, whose main business is to collect licensing fees and damages from technology companies.

The administration of President Barack Obama issued earlier this month five executive actions and seven legislative recommendations designed "to protect innovators from frivolous litigation." Among the legislative recommendations was the need to change the ITC standard for obtaining an injunction.

Technology companies like Google's Motorola Mobility and Samsung Electronics have also approached the ITC to keep competitors' products out of the U.S. market.

Section 337 investigations conducted by the ITC under the Tariff Act of 1930 most often involve claims regarding intellectual property rights, including allegations of patent and trademark infringements by imported goods, and can lead to the ban on their imports into the U.S.

Noting that the majority of complaints filed under section 337 involve patent infringement allegations, the ITC said that under the pilot program, the commission "will identify, at institution, investigations that are likely to present a potentially dispositive issue."

An administrative law judge will be assigned to rule on that issue early in the investigation through expedited fact-finding and a shortened hearing limited to the identified issue.

The initial ruling on whether a domestic industry exists or is in the process of being established in the U.S. has typically come relatively late in an investigation, often after several months of litigation, including an evidentiary hearing, when the ALJ issues his initial determination on whether there is a violation of section 337. The pilot program aims to reduce the time for an initial ruling to 100 days, with a limited extension for good cause.

The pilot program is not limited to the issue of domestic industry, which was only provided as an example of how the pilot will work, ITC said. The pilot procedure may be made permanent after evaluation, and will currently be used for certain designated investigations, it added.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

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