TAKEAWAYS
- While a complainant does not need to have constitutional standing to bring a complaint in the International Trade Commission (ITC), at least one complainant must be the owner or exclusive licensee of the underlying asserted patent, similar to the statutory standing requirement.
- Importantly, this ITC opinion does not alter a party’s requirement to have constitutional standing to appeal an ITC decision.
On May 15, 2024, the U.S. International Trade Commission (Commission) issued the public version of its opinion in the Active Matrix Organic Light-Emitting Diode Display Panels and Modules for Mobile Devices, and Components Thereof investigation (Display Panels), in which it found that constitutional standing is not required to file an intellectual property-based section 337 complaint with the Commission. The Commission does, however, for jurisdictional purposes, require for patent cases that at least one complainant be the owner or exclusive licensee. The term “owner or exclusive licensee” has been interpreted to be the same as a “patentee” under 35 U.S.C. § 281, indicating that the Article III statutory standing requirement is similar to the Commission’s jurisdictional requirement for patent cases. This decision, together with a recent precedential Federal Circuit opinion related to the domestic industry requirement, further clarifies what a prospective complainant does—and does not—have to demonstrate in order to successfully institute and maintain a section 337 investigation.
Constitutional standing is the requirement that a plaintiff in an Article III court “show that there is a case or controversy that is amenable to resolution by a federal court, by demonstrating that it suffers an injury which can be fairly traced to the defendant and likely redressed by a favorable judgment.”[i] In the context of a complaint for patent infringement, “[a] plaintiff has sufficient constitutional standing … when it possesses exclusionary rights in a patent because it suffers an injury when its rights are infringed.”[ii]
The complainant in Display Panels, Samsung Display Co. Ltd. (SDC) asserted four U.S. patents against numerous respondents. The respondents moved for summary determination that SDC lacked standing to assert its patents. The resulting Initial Determination (ID) “concluded that SDC was unable to meet its burden to prove standing because the undisputed evidence showed that [non-party Samsung Electronics Co. Ltd. (SEC)] had sublicensed the Asserted Patents on [redacted] occasions without restriction.”[iii]
Specifically, the ID found that while SDC held legal title to the asserted patents, an affiliated but independently operated Samsung entity, SEC had licensed those same patents to at least one third party. The ID further found that “SDC did not dispute that SEC had the right to sublicense the Asserted Patents …” and that SDC could not “meet its burden to show that SEC’s right to sublicense the Asserted Patents was restricted.”[iv] Critically, the “ID opined that if a party has contracted away its exclusionary rights, it does not suffer a legal injury …” and therefore lacks constitutional standing.[v]
On review, the Commission disagreed with the ID’s analysis, finding that neither constitutional standing, nor the requirement of 35 U.S.C. § 281 (that a plaintiff be a “patentee”) apply to section 337 investigations. Of particular relevance to the Commission’s determination were recent “court decisions [which] have clarified that the ‘case or controversy’ requirement of Article III does not apply to administrative tribunals such as the Commission.”[vi] Thus, because the Commission is not an Article III court, “the determination of who may bring a section 337 investigation begins with the language of the Commission’s governing statute and regulations promulgated pursuant to that authority.”[vii]
That statutory language compels the Commission to “investigate any alleged violation of this section upon the filing of the complaint, but it does not recite the same requirements as 35 U.S.C. § 281 that the complainant be the ‘patentee’ or otherwise specify who may file a complaint, except for the requirement that there be a domestic industry.”[viii] Rather, as set forth in the long adopted Commission Rule, “complainants must include a showing [in the complaint] that at least one complainant is the owner or exclusive licensee of the subject intellectual property ….”[ix]
“The terms ‘owner or exclusive licensee’ have been interpreted to be the same as the term ‘patentee’ in 35 U.S.C. § 281.”[x] Thus, the pertinent question is not whether SDC has constitutional standing, but “whether SDC is the owner or exclusive licensee of the Asserted Patent and therefore possessed sufficient rights to assert them against the respondents.”[xi] The Commission vacated the ID and remanded the case for further proceedings, noting that on remand “it is appropriate to consider precedent as to whether SDC is a ‘patentee’ who can bring a patent infringement action under 35 U.S.C. § 281.”[xii]
For the prospective complainant, the Commission’s Opinion in Display Panels does not alter the generally accepted interpretation of Commission Rule 210.12(a)(7): when the complaint is based on an allegation of intellectual property infringement, at least one of the named complainants must be the owner or exclusive licensee of the subject intellectual property. For complaints based on allegations of other unfair acts, this requirement does not apply.[xiii] Of course, other factors should be considered when selecting the complainant(s), including the potential effect that naming (or not naming) a particular entity may have on the alleged domestic industry.
Additionally, prospective complainants should consider that constitutional standing is still needed to appeal from a Commission decision, and a denial of a particular outcome by a federal agency alone is not enough to satisfy the injury-in-fact requirement.[xiv] For instance, the Federal Circuit has previously dismissed appeals from other federal agencies, e.g. the U.S. Patent and Trial Appeal Board. “[A]lthough Article III standing is not necessarily a requirement to appear before an administrative agency, once a party seeks review in a federal court, ‘the constitutional requirement that it have standing kicks in.’”[xv]
For the proposed respondent, however, the Commission’s opinion in Display Panels is more consequential in that it eliminates a potentially powerful defense to an intellectual property infringement-based section 337 complaint. Of course, additional developments are still possible on remand, as well as on appeal, if any, to the Federal Circuit. For now, however, the Commission has made clear that constitutional standing is not required for a complainant to bring an intellectual property infringement-based section 337 complaint; although, the jurisdictional standing to maintain a 337 investigation is similar to the statutory standing requirement in a district court case. Complainants should also remember that in order to appeal a Commission decision, constitutional standing will still be required.
[i] Certain Active Matrix Organic Light-Emitting Diode Display Panels and Modules for Mobile Devices, and Components Thereof, Inv. No. 337-TA-1351, Comm’n Op. at 11 (May 15, 2024) (Public Version) (citing Lone Star Silicon Innovations LLC v. Nanya Tech. Corp., 925 F.3d 1225, 1234 (Fed. Cir. 2019)) (quotations and internal citations omitted).
[ii] Display Panels at 2 (quotations omitted) (emphasis added).
[iii] Id. at 3.
[iv] Id. at 4.
[v] Display Panels at 6.
[vi] Id. at 12 (citing Momenta Pharms., Inc. v. Brystol-Myers Squibb Co., 915 F.3d 764, 768 (Fed. Cir. 2019)).
[vii] Id. at 13 (citing 19 U.S.C. § 1337, 19 C.F.R. § 210.12).
[viii] Id. (citing 19 U.S.C. § 1337(b)(1), 1337(a)(1)-(3)).
[ix] Id. (citing 19 C.F.R. §§ 210.12(a)(7), 210.12(a)(9)(ii) (requiring the “identification of the ownership of each involved U.S. patent”), 210.12(a)(9)(iv) (requiring, in part, that a complainant alleging patent infringement provide a “[c]opy of each license agreement … that complainant relies upon to establish its standing to bring the complaint”); Roku, Inc. v. Int’l Trade Comm’n, 90 F.4th 1367, 1372 (2024) (“To bring a complaint before the International Trade Commission, ‘at least one complainant [must be] the owner or exclusive licensee of the subject intellectual property.’”) (citing 19 C.F.R. § 210.12(a)(7)); see also SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1326 n.4 (Fed. Cir. 2010) (recognizing that “the Commission ‘strictly read[s] the federal standing precedent into its rules’”); see, e.g., Certain Percussive Massage Devices, Inv. 337-TA-1206, Comm’n Notice (Nov. 22, 2021) (terminating the investigation as to design patents based on lack of ownership); see also 35 U.S.C. §281.).
[x] Display Panels at 14.
[xi] Id. at 15-16.
[xii] Id. at 16.
[xiii] A complainant asserting a cause of action that does not allege infringement of a U.S. patent or registered copyright, trademark, mask word, or vessel hull design, must still “state a specific theory and provide corroborating data to support the allegation(s) in the complaint concerning the existence of a threat or effect to destroy or substantially injure a domestic industry, to prevent the establishment of a domestic industry, or to restrain or monopolize trade and commerce in the United States.” 19 CFR 210.12(a)(8). This is known as the “injury requirement,” and it was not affected by the Commission’s determination in Display Panels.
[xiv] Consumer Watchdog v. Wisconsin Alumni Rsch. Found., 753 F.3d 1258, 1261-62 (Fed. Cir. 2014) (finding that a denial of petitioner’s requested administrative action alone is insufficient to confer constitutional standing required for appeal); see also Display Panels at n.9.
[xv] Consumer Watchdog, 753 F.3d at 1261.
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