Clearcorrect Operating, LLC v. Int'l Trade Comm'n
| Decision Date | 31 March 2016 |
| Docket Number | No. 2014–1527.,2014–1527. |
| Citation | 819 F.3d 1334 (Mem) |
| Parties | CLEARCORRECT OPERATING, LLC, ClearCorrect Pakistan (Private), Ltd., Appellants v. INTERNATIONAL TRADE COMMISSION, Appellee. Align Technology, Inc., Intervenor. |
| Court | U.S. Court of Appeals — Federal Circuit |
Michael D. Myers, McClanahan Myers Espey, LLP, Houston, TX, for appellants.
Also represented by Robert Henry Espey II ; Gary Hnath, Paul Whitfield Hughes, Mayer Brown LLP, Washington, DC.
Sidney A. Rosenzweig, Office of the General Counsel, United States International Trade Commission, Washington, DC, for appellee. Also represented by Wayne W. Herrington, Dominic L. Bianchi.
Stephen Blake Kinnaird, Paul Hastings LLP, Washington, DC, for intervenor. Also represented by Thomas A. Counts, Igor Victor Timofeyev.
Steven Metalitz, Mitchell, Silberberg & Knupp, LLP, Washington, DC, for amicus curiae Association of American Publishers.
Jonathan J. Engler, Adduci, Mastriani & Schaumberg, LLP, Washington, DC, for amici curiae Motion Picture Association of America, Recording Industry Association of America. Also represented by Thomas Richard Burns, Jr., Tom M. Schaumberg.
Geoffrey A. Manne, International Center for Law & Economics, Portland, OR, for amicus curiae International Center for Law & Economics.
Eric Jay Fues, Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, Washington, DC, for amicus curiae International Trade Commission Trial Lawyers Association. Also represented by Matthew Bathon, Charles F. Schill, Steptoe & Johnson, LLP, Washington, DC; Sarah E. Hamblin, Adduci, Mastriani & Schaumberg, LLP, Washington, DC; Goutam Patnaik, Gwendolyn Tawresey, Pepper Hamilton LLP, Washington, DC.
Before PROST, Chief Judge, NEWMAN, LOURIE, DYK, MOORE, O'MALLEY, REYNA, WALLACH, TARANTO, CHEN, HUGHES, and STOLL, Circuit Judges.
, Chief Judge, and O'MALLEY, Circuit Judge, with whom WALLACH, Circuit Judge, joins, concur in the denial of the petitions for rehearing en banc.
, Circuit Judge, dissents from the denial of the petitions for rehearing en banc.
Appellee International Trade Commission and intervenor Align Technology, Inc. each filed separate petitions for rehearing en banc. A response to the petitions was invited by the court and filed by the appellants ClearCorrect Operating, LLC and ClearCorrect Pakistan (Private), Ltd. Several motions for leave to file amici curiae briefs were also filed and granted by the court.
The petitions, response, and briefs of amici curiae were referred to the panel that heard the appeal, and thereafter were referred to the circuit judges who are in regular active service. A poll was requested, taken, and failed.
The petitions for rehearing en banc are denied.
The mandate of the court will be issued on April 7, 2016.
, Chief Judge, and O'MALLEY, Circuit Judge, with whom Circuit Judge WALLACH joins, concurring in the denial of rehearing en banc.
We concur in the court's denial of the petitions for rehearing en banc. We write briefly only to address certain points newly raised by the dissent, none of which support its incorrect interpretation of the statute.
First, the dissent cites a hodgepodge of other legislative enactments: a Customs Bureau duty statute, the Trade Act of 1974, the Arms Export Control Act of 1976, the Bipartisan Congressional Trade Priorities and Accountability Act of 2015, and the Omnibus Trade and Competitiveness Act of 1998. Dissent at 1340–42. The dissent's view is that these laws illustrate Congress's intent to account for the advent of things like digital data and electronic transmissions. But these wholly separate statutory regimes have no bearing on Congressional intent regarding Section 337; what Congress has chosen to do in connection with a completely different statute is of little relevance here.1 And even if we were to accept their relevance to this case, they would prove the opposite of the dissent's point—namely, that when Congress wanted to bridge the gap between the non-digital world and the digital world, it did so affirmatively. Congress's failure to do so here supports the conclusion drawn by the panel majority, not the dissent. Moreover, the dissent is wrong to suggest that it falls on us to change the law in order to address changing times. Id. at 1339–40. Any action on that front must be taken by Congress, not us. Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 430–31, 104 S.Ct. 774, 78 L.Ed.2d 574 (1984)
(); see also Kimble v. Marvel Entm't, LLC, ––– U.S. ––––, 135 S.Ct. 2401, 2414, 192 L.Ed.2d 463 (2015) ().
The dissent also notes that "Section 337 does not depend on the mode of importation; it depends on whether the imported good infringes a patent or copyright or trademark or design." Dissent at 1337. The fact that something might infringe a U.S. patent is separate from the question of whether it is an "article." Both of these separate statutory requirements must be met in order for the ITC to exercise jurisdiction. 19 U.S.C. § 1337
.
Finally, the dissent lists thirty definitions of "article," each having varying degrees of specificity. Dissent at 1344 n.2. While the dissent posits that "[a]ll the definitions define ‘article’ as distinguishing an item from its class as a whole," id. at 1344, only a handful of its cited definitions actually do so. And in any event, none of the dissent's definitions are inconsistent with defining "article" as a "material thing." Thus, even with all the definitions brought in at this late stage, the dissent fails to support its overbroad interpretation.
The panel majority was correct in interpreting the word "articles" in Section 337 to mean "material things." That interpretation is the one that is mandated by the plain meaning of the word, the context of 19 U.S.C. § 1337(a)
and the entire statutory scheme, and the legislative history. This court is correct to deny en banc review.
, Circuit Judge, dissenting from denial of rehearing en banc.
Section 337 of the Tariff Act, 19 U.S.C. § 1337
, authorizes the International Trade Commission to exclude imports that infringe a United States patent, copyright, trademark, mask work, or design. The Commission requests rehearing en banc of the court's ruling that infringing digital goods that are imported electronically are not subject to exclusion under Section 337 of the Tariff Act. Flaws in this ruling were pointed out at ClearCorrect, Inc. v. Int'l Trade Comm'n, 810 F.3d 1283, 1304 (Fed.Cir.2015) (Newman, J., dissenting). I write to elaborate on the conflicts that have been created, and to consider the concerns raised by amici curiae.1
The court's decision is inconsistent with decisions of the Supreme Court, the Federal Circuit, the Court of Customs and Patent Appeals, the Court of International Trade, the Tariff Commission, the Department of Labor, the Bureau of Customs and Border Protection, the Arms Control Export Act, and the Bipartisan Congressional Trade Priorities and Accountability Act. I respectfully dissent.
This court now holds that the Commission has no "jurisdiction" to exclude infringing digital goods that are imported electronically. The court's removal of this jurisdiction conflicts with our recent decision in Suprema, Inc. v. International Trade Commission, 796 F.3d 1338, 1350 (Fed.Cir.2015)
(en banc), wherein the court reaffirmed that "the legislative history [of Section 337] consistently evidences Congressional intent to vest the Commission with broad enforcement authority to remedy unfair trade acts." This conflict requires resolution.
The court now holds that the word "article" in Section 337 of the Tariff Act cannot include digital goods, although "article" is the general term used throughout judicial and agency rulings for goods in trade, including digital goods. Digital goods are included in the tariff laws; they are imported, bought, and sold; they are subject to the patent laws, and have been the subject of many infringement suits. Infringement does not depend on whether the digital goods are carried on a hard substrate, or electronically.
Section 337 does not depend on the mode of importation; it depends on whether the imported goods infringe a patent or copyright or trademark or design. The amici curiae point out the consequences of the court's change of law, for infringing imports of books, motion pictures, and other products subject to transmission in digital form. The disruption that this ruling is already causing warrants en banc attention.
Section 337 does not distinguish between infringing goods imported electronically and infringing goods imported on a physical medium
The International Trade Commission applied Section 337 to ClearCorrect's "digital models, digital data, and digital information," produced by ClearCorrect's Pakistani affiliate and transmitted into the United States via the Internet; the Commission found that the patents of the complainant Align Technology were valid, and infringed by the imported digital goods. On appeal, this court held that Section 337 of the Tariff Act of 1930 does not include digital goods that are electronically imported. However, Section 337 is not so limited. The statute provides:
19 U.S.C. § 1337
. Unfair practices in import trade
(a) Unlawful activities; covered industries; definitions.
(1) Subject to paragraph (2), the following are unlawful....
* * *
(B) The importation into the United States, the sale for importation, or the sale within the United States after importation by the owner, importer, or consignee, of articles that—
(i) infringe a valid and enforceable United States patent or a valid and enforceable United States copyright registered under Title 17, United States Code, or
(ii) are made, produced, processed, or mined under, or...
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