United States: ITC Lacks Authority To Issue Exclusion Orders Based On Theory Of Induced Infringement Where Underlying Direct Infringement Occurs Postimportation

In Suprema, Inc. v. International Trade Commission, Nos. 12-1170, -1026, -1124 (Fed. Cir. Dec. 13, 2013), the Federal Circuit vacated a cease and desist order, vacated a limited exclusion order barring importation of optical scanning devices in part, and remanded so that the ITC's order could be revised to bar only a subset of the scanners-at-issue that infringed at the time of importation. The Court affirmed a separate ITC order refusing to find a violation of § 337 with respect to some of the same optical scanners.

Cross Match Technologies, Inc. ("Cross Match") filed a complaint in the ITC asserting that Suprema, Inc. ("Suprema") and Mentalix, Inc. ("Mentalix") violated 19 U.S.C. § 1337(a)(1)(B)(i) by importing articles infringing U.S. Patent Nos. 7,203,344 ("the '344 patent"); 7,277,562 ("the '562 patent"); and 5,900,993 ("the '993 patent"), which are directed to an optical scanning system for fingerprint image capturing and processing. Specifically, Cross Match alleged that Suprema, a Korean company, marketed and imported scanners and software development kits, which Mentalix, a domestic company, imported into the United States and then integrated with its own software. The ITC concluded that Suprema's scanners, when combined with Mentalix's software, directly infringed one of the method claims of the '344 patent and that Suprema induced that infringement. The ITC further found that some of Suprema's scanners directly infringed certain claims of the '993 patent. The ITC, however, found no infringement of the '562 patent. Further, the ITC determined that the '993 patent was not invalid as obvious over the prior art. Based upon these findings, the ITC issued an exclusion order identifying Suprema's induced infringement as a basis for the § 337 violation, which was directed to both Suprema and Mentalix, and also issued a cease and desist order directed only to Mentalix.

Suprema appealed the ITC's findings that it violated § 337 by infringement of the '344 patent and that certain products imported by Suprema infringed the '993 patent. Cross Match cross-appealed the ITC's determination that certain claims of the '562 patent were not infringed by either Suprema's scanners or the use of those scanners with Mentalix's software.

"[A]n exclusion order based on a violation of 19 U.S.C. § 1337(a)(1)(B)(i) may not be predicated on a theory of induced infringement under 35 U.S.C. § 271(b) where direct infringement does not occur until after importation of the articles the exclusion order would bar." Slip op. at 4.

On appeal, the Federal Circuit agreed with Suprema's argument that it did not import "articles that infringe" within the meaning of § 337(a)(1)(B)(i) because the scanners were not infringing at the time of importation. To reach its conclusion, the Court rested on principles of statutory construction. Specifically, the Court looked to 19 U.S.C. § 1337(a) to highlight that the ITC's statutory authority is premised on the "importation," "sale for importation," or "sale within the United States after importation" "of articles that . . . infringe." Slip op. at 16 (quoting 19 U.S.C. § 1337(a)(1)(B)(i)). The Court noted that the focus, therefore, of the ITC's authority is on the infringing nature of the product at the time of importation, divorced from any intent on behalf of the importer to infringe after importation.

The Court also parsed through the language of § 271 for guidance, which the Court noted provides the basis for § 1337 regulation of unfair trade practices. Specifically, the Court explained that, unlike direct and contributory infringement under § 271(a) and (c), which are tied to infringing "articles," induced infringement under § 271(b) is not, but rather is tethered to the intent of the person actively encouraging infringement. The Court reasoned that, based on the nature of the conduct prohibited in § 271(b) and the authority of § 337, § 337 does not apply to conduct prohibited in § 271(b) where the acts of underlying direct infringement occur after importation. Based on the facts of the case, the Court explained that the ITC lacked authority to exclude Suprema's scanners based on a theory of induced infringement of the method claims of the '344 patent. In a footnote, the majority responded that its ruling is not as broad as Judge Reyna's opinion dissenting-in-part implies. The majority clarified, "[V]irtually all of the mischief the dissent fears can be addressed by the ITC via resort to § 271(a) or § 271(c), or even to § 271(b) where the direct infringement occurs pre-importation." Id. at 21 n.4.

In addressing Cross Match's argument that the Federal Circuit has recognized induced infringement as a viable theory on which to base exclusion, the Court distinguished Kyocera Wireless Corp. v. International Trade Commission, 545 F.3d 1340 (Fed. Cir. 2008), and Alloc, Inc. v. International Trade Commission, 342 F.3d 1361 (Fed. Cir. 2003). Noting that the issue presently before it had never been previously presented or decided, the Court relied on the fact that the ITC's authority was not challenged in Kyocera or Alloc and, therefore, the cases were "uninformative" on the issue of whether the ITC has the statutory authority to predicate an exclusion order on induced infringement. Slip op. at 23.

The Court dismissed the parties' reliance on In re Certain Electronic Devices, Inv. No. 337-TA-724, 2012 WL 3246515 (ITC Dec. 21, 2011), in which the issue was raised finding that the language referencing the ITC's authority was dicta. In any event, the Court reasoned, Certain Electronic Devices was not necessarily inconsistent with its present ruling because that case also focused on the infringing nature of the product at the time of importation, which the Court adopted in its ruling in this case. Therefore, the Court vacated the portion of the ITC's order addressing Suprema's scanners and declined to address the ITC's findings that Mentalix directly infringed the '344 patent and whether Suprema induced that infringement.

The Federal Circuit then turned to Suprema's challenge to the ITC's determination that certain products Suprema imports infringe the '993 patent. As to the ITC's finding that the '993 patent claims excluded "non-lens elements," the Court upheld the ITC's construction and rejected Suprema's argument that the written description disavowed nonlens elements. Considering Suprema's obviousness defense, the Court agreed with the ITC that Suprema failed to sufficiently prove obviousness because U.S. Patent No. 3,619,060 ("the '060 patent") provided insufficient motivation for one skilled in the art to seek the data disclosed in U.S. Patent No. 5,615,051 ("the '051 patent") or conversely to substitute the lens disclosed in the '051 patent with the lens disclosed in the '060 patent. As a result, the Court affirmed the ITC's infringement and obviousness findings as to the '993 patent and left intact the exclusion order regarding Suprema's scanners.

With respect to Cross Match's cross-appeal, the Court affirmed the ITC's construction and noninfringement finding of the '562 patent. The issue on appeal concerned the meaning of the claim term "capture," which the ITC construed according to Cross Match's proposed construction. Based on CrossMatch's construction, the ALJ and ITC found that Suprema's products did not infringe because they did not perform all the steps of the claimed process. On appeal, Cross Match challenged the construction, however, arguing that Suprema's scanner did not have to perform all the steps of the claimed process but rather needed only be "involved in that process." In noting Cross Match's "difficult position" in arguing against its own claim construction, the Court affirmed the ITC's construction based on the claim language. Slip op. at 38. The Court ultimately concluded that the ALJ's noninfringement finding with respect to the '562 patent was supported by substantial evidence because Suprema's scanners could not have performed the claimed process based on the scanner's function.

Accordingly, the Court affirmed-in-part, vacated-in-part, and remanded-in-part the related appeals of the ITC's rulings.

Acknowledging agreement with the majority's disposition in all other respects, Judge Reyna dissented-in-part and disagreed with the majority's ruling with respect to the ITC's authority to predicate orders on induced infringement. Judge Reyna argued that the majority's holding creates a "fissure in the dam of the U.S. border" by overlooking congressional intent to remedy specific acts of unfair trade, including acts based on induced infringement. Reyna Dissent at 4-5. Resting his argument on the characterization of § 337 as a trade statute, Judge Reyna argued that temporally limiting the ITC's authority to exclude products that only infringe preimportation precludes the ITC from fully carrying out its mandate to remedy § 337 violations of infringing activity that occur within the United States. In other words, Judge Reyna argued that the ITC's authority extends to exclude products that will eventually violate § 337 after importation. Judge Reyna also disagreed with the majority's application of § 271 in this context.

Judges: Prost, O'Malley (author), Reyna (concurring-in-part and dissenting-in-part)

[Appealed from ITC]

This article previously appeared in Last Month at the Federal Circuit, January, 2014

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
22 Jan 2019, Webinar, Washington, DC, United States

As part of Strafford Publications’ webinar series, Finnegan partners Shana Cyr and Mark Feldstein will provide essential updates on FDA practice and patent law relating to biologics and biosimilars.

27 Jan 2019, Other, Washington, DC, United States

Finnegan is a sponsor of the Association of Corporate Patent Counsel Winter Meeting. Finnegan partner Erika Arner will join the panel discussion “PTAB Review & Litigation.”

27 Jan 2019, Other, Florida, United States

Finnegan is a sponsor of the Association of Corporate Patent Counsel Winter Meeting. Finnegan partner Erika Arner will join the panel discussion “PTAB Review & Litigation.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions