United States: ITC Issues Final Determination Finding Violation Of Section 337 In Certain Network Devices (337-TA-945)

Last Updated: May 24 2017
Article by Eric Schweibenz

On May 4, 2017, the U.S. International Trade Commission ("Commission") issued a notice of Final Determination on violation of Section 337 in Certain Network Devices, Related Software, and Components Thereof (II) (Inv. No. 337-TA-945).

By way of background, this investigation is based on a December 19, 2014 complaint filed by Cisco Systems, Inc. of San Jose, California alleging violation of Section 337 in the importation into the U.S. and sale of certain networking equipment and components and software thereof that infringe one or more claims of U.S. Patent Nos. 7,023,853; 6,377,577; 7,460,492; 7,061,875; 7,224,668; and 8,051,211. See our December 29, 2014 and February 6, 2015 posts for more details on the complaint and Notice of Investigation, respectively.

According to the notice, the Commission determined:

With respect to the '577 patent, the Commission determined to review the Final ID's finding that Arista has indirectly infringed the '577 patent by importing Imported Components, as referenced at page 110 in the Final ID. The Commission also determined to review the Final ID's finding that Arista's post-importation direct infringement cannot alone support a finding of violation of section 337. The Commission further determined to review the Final ID's finding that Feldmeier anticipates claims 1, 7, 9, 10, and 15 of the '577 patent.

With respect to the '853 patent, the Commission determined to review the Final ID's claim construction findings with respect to claim elements (c), (d), and (f) of claim 46. The Commission also determined to review the Final ID's findings concerning direct and indirect infringement regarding the '853 patent. The Commission further determined to review the Final ID's finding that assignor estoppel applies to validity challenges based on indefiniteness. The Commission also determined to review the Final ID's finding that Feldmeier does not anticipate claim 46.

With respect to the '875 and '492 patents, the Commission determined to review the Final ID's finding of no direct infringement and the related finding of no indirect infringement. The Commission also determined to review the Final ID's finding that Cisco has failed to satisfy the technical prong of the domestic industry requirement with respect to the '875 and '492 patents.

With respect to the '668 patent, the Commission determined to review the Final ID's finding of direct infringement and the Final ID's finding of indirect infringement, in particular as concerns Arista's importation of Imported Components.

With respect to the '211 patent, the Commission determined to review the Final ID's finding that Cisco has failed to satisfy the technical prong with respect to claims 1 and 12 of the '211 patent, including the Final ID's finding that claims 1 and 12 are invalid.

The Commission determined not to review the remaining issues decided in the Final ID.

The Commission also requested briefing from the parties on nine questions concerning the issues under review, as well as remedy, the public interest, and bonding. See Notice of Review at 4-5; 82 FR at 12845-46.

On March 15, 2017, the parties submitted initial briefing in response to the notice of review. On March 24, 2017, the parties filed response submissions.

Having examined the record of this investigation, including the Final ID, the petitions for review, the responses thereto, and the parties' submissions on review, the Commission has determined to find that a violation of section 337 has occurred with respect to the asserted claims of the '577 and '668 patents.

Specifically, with respect to the '577 patent, the Commission did not review the Final ID's finding that all of Arista's Accused ACL Products directly infringe claims 1, 7, 9-10, and 13 of the '577 patent. The Commission has determined to affirm the Final ID's finding that Arista induces infringement of the '577 patent by importing both the Blank Switches and Imported Components (as defined at Final ID at 110 and Respondent Arista Networks Inc.'s Petition for Review of the Initial Determination on Violation of Section 337 (Dec. 29, 2016) at 77, 80). The Commission has further determined to affirm the Final ID's finding that Arista contributorily infringes by importing the Blank Switches. The Commission has determined not to reach the issue of whether Arista contributorily infringes the asserted claims of the '577 patent by importing the Imported Components. Based on the Final ID's unreviewed finding that assignor estoppel applies with respect to the '577 patent, the Commission has determined not to reach the issue of whether Feldmeier anticipates the '577 patent.

With respect to the '668 patent, the Commission has determined to affirm the Final ID's finding that several variations of the '668 Accused Products-including Control-Plane Access Control List, Control Plane Policing, and non-configurable Per-Input Port Control Plane Policing ("PiP CoPP") infringe asserted claims 1, 2, 4, 5, 7, 8, 10, 13, 56, and 64 of the '668 patent, and to affirm with modification the Final ID's finding that the variation including configurable PiP CoPP infringes those claims, to supply the Commission's reasoning. With respect to claim 64, the Commission has determined to affirm with modification the Final ID's finding of infringement with respect to claim 64 to correct a misstatement in the Final ID. The Commission has also determined to affirm the Final ID's finding that Arista induces infringement of the asserted claims of the '668 patent by importing fully assembled Blank Switches and the Imported Components. The Commission has further determined to affirm the Final ID's finding that Arista contributorily infringes asserted claims 1, 2, 4, 5, 7, 8, 10, 13, 56, and 64 by importing fully assembled Blank Switches. The Commission has determined not to reach the issue of whether Arista contributorily infringes the asserted claims of the '668 patent by importing the Imported Components.

The Commission has determined to find no violation of section 337 with respect to the remaining asserted claims of the '853, '875, '492, and '211 patents.

Specifically, with respect to the '853 patent, the Commission has determined to affirm with modification, to supply the Commission's reasoning, the Final ID's finding that Arista's Accused ACL Products do not directly infringe claim 46, and to affirm the Final ID's finding that Arista does not directly infringe claim 63 of the '853 patent. Accordingly, the Commission has determined to affirm the Final ID's finding of no indirect infringement with respect to those claims. Based on the Final ID's unreviewed finding that assignor estoppel applies with respect to the '853 patent, the Commission has determined to reach the issue of whether Feldmeier anticipates the '853 patent.

With respect to the '875 and '492 patents, the Commission has determined to affirm with modification the Final ID's finding of no infringement of the asserted claims and that Cisco has failed to satisfy the technical prong of the domestic industry requirement.

With respect to the '211 patent, the Commission did not review the Final ID's finding of no infringement with respect to the asserted claims of the '211 patent. The Commission has also determined to vacate the Final ID's finding with respect to the validity of claims 1 and 12 of the '211 patent, and declines to reach the technical prong issue.

The Commission has determined that the appropriate form of relief is a limited exclusion order under 19 U.S.C. § 1337(d)(1), prohibiting the unlicensed entry of network devices, related software and components thereof that infringe any of claims 1, 7, 9, 10, and 15 of the '577 patent; and claims 1, 2, 4, 5, 7, 8, 10, 13, 18, 56, and 64 of the '668 patent, and an order that Arista cease and desist from importing, selling, marketing, advertising, distributing, transferring (except for exportation), soliciting United States agents or distributors, and aiding or abetting other entities in the importation, sale for importation, sale after importation, transfer (except for exportation), or distribution of certain network devices, related software and components thereof that infringe any of claims 1, 7, 9, 10, and 15 of the '577 patent; and claims 1, 2, 4, 5, 7, 8, 10, 13, 18, 56, and 64 of the '668 patent.

The Commission has determined that the public interest factors enumerated in section 337(d) and (f), 19 U.S.C. § 1337(d) and (f), do not preclude the issuance of the limited exclusion order or cease and desist order. The Commission has determined that bonding at five (5) percent of the entered value of the covered products is required during the period of Presidential review, 19 U.S.C. § 1337(j).

The Commission's order and opinion were delivered to the President and the United States Trade Representative on the day of their issuance.

The investigation is terminated.

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.

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