Apple, Samsung, and several other device manufacturers are being investigated by the U.S. International Trade Commission
(USITC). The ITC voted to follow through on a complaint made by Neodron Ltd of Ireland. The latter complained that several tech firms had sold products such as touchscreen mobile phones, computers, and computer parts while infringing on its patents. Neodron says that these devices and components were imported into the U.S. in violation of Section 337 of the Tariff Act of 1930.
Neodron is a non-practicing entity (NPE) that many consider to be a "patent troll"
Neodron seeks a limited exclusion order which would ban the import of the offending products into the United States. The company also seeks a cease and desist order against the defendants. The former would prevent devices infringing on Neodron's patents from being imported into the states. The latter would force stores to remove offending devices that were already shipped into the U.S.
The companies being investigated by the ITC include:
Amazon.com, Inc., of Seattle, WA.
Apple Inc. of Cupertino, CA.
ASUSTeK Computer Inc. of Taipei, Taiwan.
ASUS Computer International of Fremont, CA.
LG Electronics Inc. of Seoul, Korea.
LG Electronics USA, Inc., of Englewood Cliffs, NJ.
Microsoft Corporation of Redmond, WA.
Motorola Mobility LLC of Chicago, IL.
Samsung Electronics Co., Ltd., of Suwon, South Korea.
Samsung Electronics America, Inc., of Ridgefield Park, NJ.
Sony Corporation of Tokyo, Japan.
Sony Mobile Communications Inc. of Tokyo, Japan.
According to the ITC, the next step involves having the agency's Chief Administrative Law Judge assign the investigation to one of the USITC's administrative law judges who will preside over an evidentiary hearing. Based on the evidence presented, this judge will make an initial determination as to whether Section 337 was violated; that decision could be reviewed by the entire commission.
The U.S. International Trade Commission can ban imports from entering the states
Within 45 days of the start of the investigation, the USITC must provide a target day for completing the investigation. Any exclusion orders or cease and desist orders become effective when issued and are final after 60 days unless the U.S. Trade Representative disagrees with the final ruling for policy reasons.
Neodron filed a Notice of Institution of Investigation on February 14th claiming that certain patents (U.S. Patent No. 7,821,425; U.S. Patent No. 7,903,092; U.S. Patent No. 8,749,251; and U.S. Patent No. 9,411,472 had been infringed on by manufacturers who shipped these devices into the states.
It should be pointed out that Neodron is a non-practicing entity (NPE). The company generates income by acquiring a large number of patents and then defends them in court. Many of us media types have used the term "patent troll" to describe such a company. The firm was founded in 2018 and it already has taken several big name tech companies to court and has filed complaints with the International Trade Commission. Companies such as Neodron are all about pressuring companies into making a settlement offer. Many tech firms would rather not deal with what they consider to be a nuisance. And if the USITC does issue an exclusion order, a cease and desist order, or both, the affected manufacturers would gladly make what some might consider a ransom payment. This would prevent these companies' products from being banned in the U.S., one of the largest markets for tech devices.
You might recall that back in 2012, two HTC handsets were temporarily blocked from entering the U.S. Customs prevented shipments of the HTC One X for AT&T and Sprint's HTC EVO 4G LTE from being released
in the states after the ITC found that the Taiwan manufacturer infringed on a patent owned by Apple. The following year, President Barack Obama vetoed an import ban against Apple that was ordered by the ITC. Samsung filed the complaint which would have prevented the iPhone 4
and certain iPad models from landing in the U.S.