United States: Sany Heavy Industry v. ITC: Federal Circuit Affirms 10-Year Exclusion Order For Misappropriated Trade Secrets

On October 11, 2016, the Federal Circuit affirmed the ITC's finding of violation and issuance of a 10-year limited exclusion order barring the importation of crawler cranes made using trade secrets misappropriated from complainant Manitowoc Cranes, LLC. The respondents are Sany Heavy Industry Co., Ltd. of Changsha, China, and Sany America, Inc. of Peachtree City, Georgia (collectively "Sany"). The per curiam judgment was rendered by a panel consisting of Judges Lourie, Dyk, and O'Malley, after hearing oral arguments on October 5, 2016. No opinion was provided.  The case is Sany Heavy Industry Co., Ltd. v. ITC (Case No. 15-1780).  The corresponding ITC case is Certain Crawler Cranes and Components Thereof (Inv. No. 337-TA-887).

As discussed in our previous post, the Commission had imposed the exclusion order after finding that respondents Sany violated Section 337 by misappropriating trade secrets owned by Manitowoc.  The trade secrets related to mobile cranes used in construction and heavy industry. The Commission found that the trade secrets had been disclosed to Sany by John Lanning, a former employee of Manitowoc. The 10-year duration of the exclusion order was based on the time it would have taken Sany to develop the trade secrets.

In the oral argument, Sany contended that the alleged trade secret information disclosed by Lanning was already public information at the time of the disclosure. Sany also argued that the duration of the 10-year exclusion order was "arbitrary and capricious." In response, Manitowoc argued in support of the Commission's determination that Lanning's disclosure breached his confidentiality obligations with the company. Manitowoc also argued that the improperly obtained information from Lanning was central to Sany's development of the accused cranes.

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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