December 21, 2022
An Introduction to Section 337 Intellectual Property Litigation
at the U.S. International Trade Commission
In recent decades, parties asserting patent infringement and
Importation
other intellectual property (IP) claims have increasingly
For the ITC to find a violation of Section 337, the
looked to the U.S. International Trade Commission (ITC) as
infringing articles must be imported into the United States,
a fast-paced forum with authority to stop the importation of
sold for importation into the United States, or sold within
infringing products. This In Focus provides an overview of
the United States after importation. Although respondents
these “Section 337” (or “unfair import”) investigations; the
do not always contest importation, it can be challenging for
special legal issues and remedies involved; the litigation
complainants to determine whether and how the infringing
process; and changes proposed by some in Congress.
articles are imported, especially if the articles are merely
components of other products.
Background on the ITC and Section 337
Congress created the ITC as the U.S. Tariff Commission in
Domestic Industry
1916 and gave the agency its current name in 1974. The
A crucial and often litigated condition for the ITC to find a
ITC is an independent, nonpartisan agency led by six
violation of Section 337 is the so-called domestic industry
commissioners who are appointed by the President and
(DI) requirement. For claims involving patents or other
confirmed by the Senate to nine-year terms. The President
statutory IP, Section 337 essentially requires the
appoints one commissioner each to serve as chair and vice
complainant to prove there are both (1) articles that practice
chair for a two-year term. No more than three
the IP (the “technical prong”) and (2) a U.S. industry
commissioners may be of the same political party, and the
relating to those articles consisting of significant
chair cannot be of the same party as either the prior chair or
investments in (a) plant and equipment; (b) labor or capital;
the vice chair. In addition to unfair import investigations,
or (c) exploitation activities such as engineering, research
the ITC conducts other trade-related investigations,
and development, or licensing (the “economic prong”).
including import injury investigations involving
antidumping and countervailing duties. The ITC also
By contrast, for claims involving other “unfair acts,”
administers the U.S. tariff schedule and provides
including trade-secret misappropriation, complainants meet
information and analysis to the President and Congress.
the DI requirement by proving that the “threat or effect” of
the respondents’ actions is “(i) to destroy or substantially
The ITC’s authority to investigate unfair imports is
injure an industry in the United States; (ii) to prevent the
governed by Section 337 of the Tariff Act of 1930 (19
establishment of such an industry; or (iii) to restrain or
U.S.C. § 1337). Section 337 expressly encompasses
monopolize trade and commerce in the United States.”
infringement of patents, copyrights, trademarks, and certain
Thus, unlike patent cases, complainants in trade secret cases
other “statutory” IP. It also extends generally to “unfair
must prove real or threatened injury to their DI, although
methods of competition and unfair acts,” which include
the DI need not practice the asserted trade secrets.
trade-secret misappropriation and non-IP claims. Patent
infringement claims comprise the vast majority of Section
It is often challenging to apply these tests to the facts of
337 cases, although recent years have seen an uptick in
specific cases. One controversy is the extent to which non-
trade secret claims.
practicing entities, which hold patents but do not practice
the patented technologies, should be able to satisfy the DI
The ITC’s Section 337 caseload increased significantly in
requirement through patent licensing programs. The AAIA,
this century, with 127 ongoing investigations in 2021 and
which aims “to ensure that the resources of the [ITC] are
128 in 2011, compared with 38 in 2001. These proceedings
focused on protecting genuine domestic industries,” would
have also drawn congressional interest. One bill introduced
amend Section 337 to limit the ability of complainants to
in the 117th Congress—H.R. 5184, the Advancing
rely on either their own patent licensing programs or the
America’s Interests Act (AAIA)—would amend Section
activities of licensees to satisfy the DI requirement.
337 in various respects, as described below.
Remedies
Legal Issues in Section 337 Cases
Unlike U.S. district courts, the ITC cannot order money
Just like plaintiffs in U.S. district court cases, complainants
damages for IP infringement. Nonetheless, the ITC may
asserting IP claims under Section 337 must prove
issue powerful injunctive remedies. If the ITC finds a
infringement or misappropriation of their IP rights. As a
violation of Section 337, it typically enters a limited
trade statute, however, Section 337 requires the ITC to
exclusion order, preventing specific persons from importing
consider special additional issues. The ITC also has
infringing articles into the United States. It may also enter
different remedies at its disposal than may be available in
general exclusion orders, not limited to specific persons, “to
district court.
prevent circumvention” or address “a pattern of violation.”
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An Introduction to Section 337 Intellectual Property Litigation at the U.S. International Trade Commission
U.S. Customs and Border Protection enforces exclusion
determination at a party’s request or of their own volition
orders at U.S. ports of entry.
and may affirm, modify, reverse, or remand all or part of it.
Otherwise, the initial determination becomes final.
In addition, the ITC may enter cease-and-desist orders
(CDOs) enforceable by civil fines. CDOs are typically
A party may appeal a final determination to the U.S. Court
entered against respondents who have significant inventory
of Appeals for the Federal Circuit. Section 337 also allows
or operations in the United States and might therefore be
the President to disapprove a final determination within 60
able to circumvent an exclusion order. In 2022, for instance,
days for any “policy reasons,” an authority delegated to the
the ITC entered both a limited exclusion order and a CDO
U.S. Trade Representative (USTR). The only such
regarding wind turbine parts found to infringe General
presidential disapproval in recent decades came in 2013,
Electric’s patent rights (Investigation No. 337-TA-1218).
when the USTR set aside a CDO and exclusion order
against Apple and some of its iPhone and iPad products
Public Interest
found to infringe one of Samsung’s patents. The USTR
Even if the ITC finds a violation of Section 337, it may
determined that public-interest factors regarding
tailor or refrain from issuing a remedy based on public-
competitive conditions and U.S. consumers weighed against
interest factors of “public health and welfare, competitive
the ITC’s injunctions, as the patent appeared to be a
conditions ... , the production of like or directly competitive
“standard-essential patent” on an invention necessary to
articles in the United States, and United States consumers.”
comply with a technical standard for mobile devices.
In the wind turbine investigation noted above, for instance,
the ITC made an exception to its remedies to allow for
The ITC has experimented with ways to resolve
service and repair of already existing turbines.
investigations even faster. An ongoing pilot program allows
ALJs to enter interim initial determinations following a
The AAIA attempts to give more weight to the public-
hearing on one or more significant issues that may facilitate
interest analysis. The bill would prevent the ITC from
settlement or dispose of the case. In addition, an “early
entering an exclusion order without finding that doing so is
disposition” program allows ALJs to hold a hearing and
in the public interest. It would also allow the ITC to
issue an initial determination on a single dispositive issue
terminate an investigation early if it finds that excluding the
(e.g., importation or DI) within the investigation’s first 100
accused articles would not be in the public interest.
days. ALJs usually deny requests for early disposition
proceedings, often citing the complexity of the issues
Litigation Process for Section 337 Cases
involved. To increase the use of these proceedings, the
In addition to the substantive issues above, Section 337
AAIA would direct the commissioners to require ALJs to
litigation has unique procedural characteristics, including
conduct early disposition proceedings in appropriate cases.
the judges and parties involved, the fast pace, and the
opportunities to appeal adverse decisions.
Parallel Litigation
Complainants in a Section 337 investigation may assert
Judges and Parties
their claims in U.S. district court as well as the ITC—for
Each Section 337 investigation is assigned to one of the
instance, to seek money damages in addition to ITC
ITC’s administrative law judges (ALJs). The parties to a
remedies. Respondents, however, have the right under 28
Section 337 investigation include not only complainants
U.S.C. § 1659 to stay (i.e., pause) a parallel district court
and respondents, but also the ITC’s Office of Unfair Import
action to the extent that it involves the same issues as the
Investigations, which represents the public interest and may
ITC case until the ITC reaches its final determination.
take an active role in the litigation.
Similarly, respondents in a Section 337 investigation may
Litigation Process and Appeals
challenge the validity of an asserted patent both in the ITC
Section 337 requires the ITC to resolve investigations “at
case and by filing a petition for proceedings with the U.S.
the earliest practicable time,” and the ALJ must set a date
Patent Trial and Appeal Board (PTAB). Following new
for the ITC’s final determination. This “target date” cannot
guidance issued in June 2022, PTAB cannot decline to hear
be more than 16 months after institution of the investigation
these challenges on the basis of a pending Section 337
without the commissioners’ consent. In FY2021, the
investigation as it had often done previously.
average duration of investigations reaching a final
determination on the merits was just longer than 18 months.
Considerations for Congress
As one of the main vehicles for high-stakes IP litigation
Civil procedure in Section 337 investigations is governed
involving imported products, Section 337 investigations
by the ITC Rules of Practice and Procedure and the ALJ’s
have drawn congressional interest. Should Congress seek to
personal “ground rules.” As in district court cases, the
change the existing Section 337 legal requirements and
parties conduct fact and expert discovery via depositions
litigation process, it could consider amendments to the
and other disclosures, albeit on an accelerated time frame.
statute such as those envisioned by the AAIA. Congress
could also consider whether trade-secret misappropriation
Unless the investigation is terminated earlier—e.g., due to
claims should continue to be subjected to a different DI test
settlement—it proceeds to a trial-like evidentiary hearing
than patent and other statutory IP claims.
governed by the Administrative Procedure Act. The ALJ
presides over the hearing and makes findings via an initial
Christopher T. Zirpoli, Legislative Attorney
determination. The commissioners may review the initial
IF12295
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An Introduction to Section 337 Intellectual Property Litigation at the U.S. International Trade Commission


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