HTC Android Smartphones: ITC Issues Limited Exclusion Order
The International Trade Commission has found a patent violation in its investigation of certain HTC smartphones using Android software and has issued a limited exclusion order (LEO) prohibiting importation of infringing devices and related software effective April 19, 2012. This final determination states that the delayed effective date is based on competitive conditions and will provide a transition period for U.S. carriers. The ITC has also determined to set the bonding requirement at zero during the 60-day Presidential Review Period, and has terminated the investigation (Investigation No. 337-TA-710).
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In addition, the ITC has determined, based on consideration of the effect of exclusion on U.S. consumers, that until December 19, 2013, HTC may import refurbished handsets to be provided to consumers as replacements under warranty or an insurance contract (whether the warranty or contract is offered by HTC, a carrier, or by a third party).
The violation that was found involves certain claims of Apple's '647 patent. (Note that press sources state that HTC will remove the offending technology, which should avoid disruption to its U.S. business.)
The ITC instituted this investigation on April 6, 2010, based on a complaint filed by Apple Inc., and its subsidiary NeXT Software, Inc., both of Cupertino, California (collectively, “Apple”), alleging a violation of section 337 in the importation, sale for importation, and sale within the United States after importation of certain personal data and mobile communications devices and related software that infringe certain U.S. patents. The notice of investigation named as respondents High Tech Computer Corp. of Taoyuan City, Taiwan and its U.S. subsidiaries HTC America Inc. of Bellevue, Washington, and Exedia, Inc. of Houston, Texas (collectively "HTC"). (See ITT's Online Archives 11092044 for summary of ITC notice on possible Section 337 action in this investigation.)
(According to the ITC, the primary remedy available in Section 337 investigations is an exclusion order that directs U.S. Customs and Border Protection to stop infringing imports from entering the U.S. The exclusion from entry is limited to persons determined by ITC to be in violation, unless ITC determines that a general exclusion order is necessary to prevent circumvention, there is a pattern of violation, etc. In addition, the ITC may issue cease and desist orders against named importers and other persons engaged in unfair acts that violate Section 337.
The ITC's exclusion orders, which are enforced by CBP, usually take effect 60 days after issuance unless disapproved by the President for policy reasons. During the 60-day “Presidential review period,” infringing articles may enter the U.S. provided the importer posts a bond with CBP in an amount determined by the ITC. Appeals of the ITC orders entered in Section 337 investigations are heard by the U.S. Court of Appeals for the Federal Circuit.)
FR notice issued subsequent to publication, dated 11/23/11, available here.
ITC Contact - Sidney Rosenzweig (202) 708-2532
(Inv. No. 337-TA-710)