Wirtgen Am., Inc. v. United States

Decision Date11 March 2020
Docket NumberCase No. 20-cv-195 (CRC)
Citation443 F.Supp.3d 198
Parties WIRTGEN AMERICA, INC., Plaintiff, v. UNITED STATES, et al., Defendants
CourtU.S. District Court — District of Columbia

Daniel E. Yonan, Donald R. Banowit, Kristina A. Caggiano Kelly, Michael E. Joffre, Dallin Glenn, Sterne, Kessler, Goldstein & Fox PLLC, Washington, DC, William E. Sekyi, Patterson Intellectual Property Law, P.C., Nashville, TN, for Plaintiff.

William Chang, U.S. Attorney's Office for the District of Columbia, Washington, DC, Justin R. Miller, U.S. Department of Justice International Trade Field Office, New York, NY, for Defendants.

MEMORANDUM OPINION

CHRISTOPHER R. COOPER, United States District Judge Plaintiff Wirtgen America, Inc. distributes road-construction equipment manufactured by its German parent company. Last summer, the International Trade Commission ("ITC" or the "Commission") ruled that a line of Wirtgen's road-milling machines infringed a patent held by rival Caterpillar, Inc., so it entered a limited exclusion order barring Wirtgen from importing machines "that infringe" the Caterpillar patent. See 19 U.S.C. § 1337(d)(1), (e)(1). Wirtgen subsequently attempted to import machines from the same line that it proclaimed had been modified to avoid infringement. U.S. Customs and Border Protection ("CBP" or "Customs"), which enforces ITC exclusion orders, nevertheless denied entry of a number of Wirtgen's redesigned machines. In doing so, it followed the Commission's longstanding interpretation of its remedial orders as covering not only the precise articles that were adjudicated to infringe, but also any similarly infringing articles that might be imported in the future, as well as the ITC's concomitant policy of requiring the importer to demonstrate that the modified articles no longer infringe.

Wirtgen's challenge to the exclusion of its redesigned machines has been proceeding along two roadways. First, the Commission has undertaken a modification proceeding to determine whether the machines fall within the exclusion order, and Wirtgen's appeal of the Commission's determination as to the original machines remains pending before the Federal Circuit. Second, Wirtgen filed an administrative protest with Customs contesting the exclusion of its redesigned machines, the denial of which is currently pending before the Court of International Trade ("CIT").

With this case, Wirtgen seeks to open yet another avenue of judicial review. Here, Wirtgen purports not to contest any patent infringement determinations by the ITC or the scope of the limited exclusion order. Wirtgen instead frames its complaint merely as a challenge to Customs's application of the order to the redesigned machines, which it claims violates the Due Process and Appointments Clauses of the federal Constitution. On that basis, Wirtgen seeks a temporary restraining order and a preliminary injunction requiring Customs to permit entry of the machines for immediate delivery to Wirtgen's customers.

Customs, joined by the Commission as an intervenor, moves to dismiss the complaint for lack of subject-matter jurisdiction. They contend that despite how Wirtgen has styled its claims, its true targets are the scope of the limited exclusion order itself and the Commission's interpretation of its statutory authority to issue broad remedial orders that cover similar, unadjudicated articles. This Court lacks jurisdiction over Wirtgen's actual claims, the Government contends, because Congress has channeled such claims through an alternative administrative and judicial review process—namely, a modification proceeding before the Commission followed by a right of appeal to the Federal Circuit. See Thunder Basin Coal Co. v. Reich, 510 U.S. 200, 114 S.Ct. 771, 127 L.Ed.2d 29 (1994).

The Court of International Trade recently asserted jurisdiction over Wirtgen's challenge to Customs's protest denial, rejecting the Government's position that Wirtgen's claims must go through the Commission. But this Court need not decide which of the two administrative highways—ITC to the Federal Circuit or Customs to the CIT—Wirtgen must travel (although it will express a view), because whichever route Congress meant to lay, Wirtgen may not pave a new one in federal district court. Concluding that Congress intended for Wirtgen's claims to be litigated elsewhere, the Court will grant the Government's motion to dismiss, deny Wirtgen's motion for injunctive relief, and dismiss the case.

I. Background

Section 337 of the Tariff Act of 1930 was enacted to "protect[ ] ... the public interest from unfair trade practices in international commerce." Akzo N.V. v. Int'l Trade Comm'n, 808 F.2d 1471, 1488 (Fed. Cir. 1986). To that end, it prohibits "[t]he importation into the United States" of, among other things, "articles that infringe a valid and enforceable United States patent." 19 U.S.C. § 1337(a)(1)(B)(i).

The International Trade Commission administers Section 337. The Tariff Act tasks the Commission with investigating and making determinations as to violations of Section 337, including patent infringement. See id. § 1337(b)(1), (c). Following a determination of a Section 337 violation, the Commission has broad remedial authority to issue exclusion orders barring "the articles concerned" from entry into the United States. Id. § 1337(d)(1), (e)(1).

Meanwhile, Customs and Border Patrol enforces orders issued by the Commission. The Commission must notify Customs of any exclusion order that it issues, and Customs "shall" accordingly "refuse such entry." Id. § 1337(d)(1), (e)(1).1

A. Proceedings before the International Trade Commission
1. Determination of Patent Infringement

Section 337 investigations proceed in two parts: an evidentiary hearing before and final initial determination ("FID") by an administrative law judge ("ALJ"), followed by Commission review. Determinations as to violations of Section 337 are to be made through formal adjudication, i.e. , "on the record after notice and opportunity for a hearing." 19 U.S.C. § 1337(c) ; see also 19 C.F.R. §§ 210.1 - .79.

In November 2017, Caterpillar, Inc. and Caterpillar Paving Products, Inc. (collectively, "Caterpillar") filed a complaint with the Commission alleging that certain models of Wirtgen's road construction machines infringe U.S. Patent No. 7,140,693 (the "'693 patent"). See Compl. ¶ 169; Compl., Certain Rd. Constr. Mach. & Components Thereof, Inv. No. 337-TA-1088 (Int'l Trade Comm'n Nov. 29, 2017). Following an evidentiary hearing, an ALJ issued a final initial determination in February 2019. See Compl., Exh. 16 [hereinafter "FID"]. The FID concluded that Wirtgen's 1810 Series machines ("Original 1810 Series") infringed claim 19 of Caterpillar's '693 patent. Id. at 84–85; Compl. ¶¶ 170, 173.

During the Commission's investigation, Wirtgen redesigned the swing leg of its 1810 series machines (the "Redesigned 1810 Series"). Compl. ¶ 179. Wirtgen argued to the ALJ that the Redesigned 1810 Series machines did not infringe the '693 patent. The ALJ concluded that "[t]hese alternate swing-leg designs are not ripe for a determination of infringement or non-infringement in this investigation," because "[t]hese designs have not been implemented in any imported articles ... and are thus outside the scope of this investigation." FID at 25 (emphasis added). On July 15, 2019, the Commission adopted the FID in full, including its finding that the Original 1810 Series machines infringe claim 19 of the '693 patent. See Op., Certain Rd. Constr. Mach. & Components Thereof, Inv. No. 337-TA-1088, 2019 WL 6003332 at *15–17 (Int'l Trade Comm'n July 15, 2019).

2. Limited Exclusion Order

The Commission must issue a limited exclusion order ("LEO") against respondents that are found to have imported infringing articles. See 19 U.S.C. § 1337(d)(1).2 Upon its finding of patent infringement by Wirtgen, the ALJ thus recommended in the FID that the Commission issue an LEO against Wirtgen. Compl. ¶ 175.

Wirtgen argued to the ALJ that the LEO should be limited "to [the] accused road milling machines and ... should not encompass other road construction machines and components." FID at 79. The ALJ rejected that contention. The ALJ cited "[l]ong-standing Commission precedent support[ing] [the] issuance of broad remedial orders extending to all products covered by the patent claims as to which a violation has been found, rather than limiting its orders to only those specific models selected for infringement analysis.’ " Id. at 80 (quoting Op., Certain Hardware Logic Emulation Sys. & Components Thereof, Inv. No. 337-TA-383, USITC Pub. 3089 at 16 (Int'l Trade Comm'n Mar. 1998)) (emphasis added).

The Commission adopted the ALJ's recommendation and, on June 27, 2019, issued an LEO against Wirtgen. The Commission "determined that there is a violation of Section 337 ... in the unlawful importation ... by [Wirtgen] of certain road construction machines and components thereof covered by claim 19 of [the '693 patent ]." Compl., Exh. 14 at 1 [hereinafter "LEO"]. The Commission further "determined that the appropriate form of relief" for that violation "includes a limited exclusion order prohibiting the unlicensed entry into the United States of certain road construction machines and components thereof manufactured by [Wirtgen] that infringe claim 19 of the '693 patent." Id. (emphasis added).

The LEO further provided that "persons seeking to import road construction machines and components thereof, that are potentially subject to this Order may be required to certify that ... the products being imported are not excluded from entry under paragraph l of this Order." Id. at 3. In addition, Customs could, "[a]t its discretion, ... require persons who have provided the certification described in this paragraph to furnish such records or analyses as are necessary to substantiate this certification." Id. 3

3. Administrative and Judicial Review

"[F]inal determination[s] of the Commission" made under Section 337...

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