[Federal Register Volume 83, Number 242 (Tuesday, December 18, 2018)]
[Notices]
[Pages 64875-64878]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-27301]


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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1065]


Certain Mobile Electronic Devices and Radio Frequency and 
Processing Components Thereof; Commission Determination To Review in 
Part a Final Initial Determination Finding a Violation of Section 337; 
Schedule for Filing Written Submissions on the Issues Under Review and 
on Remedy, Public Interest, and Bonding; and Extension of the Target 
Date

AGENCY: U.S. International Trade Commission.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the U.S. International Trade 
Commission (the ``Commission'') has determined to review in part the 
final initial determination (``ID'') of the administrative law judge 
(``ALJ''), which was issued on September 28, 2018. The Commission has 
determined to extend the target date for completion of the 
investigation to February 19, 2019.

FOR FURTHER INFORMATION CONTACT: Carl P. Bretscher, Office of the 
General Counsel, U.S. International Trade Commission, 500 E Street SW, 
Washington, DC 20436, telephone (202) 205-2382. Copies of non-
confidential documents filed in connection with this investigation are 
or will be available for inspection during official business hours 
(8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. 
International Trade Commission, 500 E Street SW, Washington, DC 20436, 
telephone (202) 205-2000. General information concerning the Commission 
may also be obtained by accessing its internet server (https://www.usitc.gov). The public record for this investigation may be viewed 
on the Commission's Electronic Docket Information System (``EDIS'') 
(https://edis.usitc.gov). Hearing-impaired persons are advised that 
information on this matter can be obtained by contacting the 
Commission's TDD terminal, telephone (202) 205-1810.

SUPPLEMENTARY INFORMATION: On August 14, 2017, the Commission 
instituted this investigation based on a Complaint and amendment 
thereto filed by Qualcomm Incorporated of San Diego, California 
(``Qualcomm''). 82 FR 37899 (Aug. 14, 2017). The notice of 
investigation named Apple Inc. of Cupertino, California (``Apple'') as 
Respondent. The Complaint alleged violations of Section 337 of the 
Tariff Act of 1930, as amended (19 U.S.C. 1337), by reason of the 
importation into the United States,

[[Page 64876]]

sale for importation, or sale within the United States after 
importation of certain mobile electronic devices and radio frequency 
and processing components thereof that infringe one or more claims of 
U.S. Patent No. 9,535,490 (``the '490 patent''), U.S. Patent No. 
8,698,558 (``the '558 patent''), U.S. Patent No. 8,633,936 (``the '936 
patent''), U.S. Patent No. 8,838,949 (``the '949 patent''), U.S. Patent 
No. 9,608,675 (``the '675 patent''), and U.S. Patent No. 8,487,658 
(``the '658 patent''). The Office of Unfair Import Investigations 
(``OUII'') is also a party to this investigation.
    The following claims were voluntarily terminated during the course 
of this investigation: all asserted claims of the '658 patent, '949 
patent, and '675 patent; claims 1, 20-24, 26, 38, 67, and 68 of the 
'936 patent; claims 1, 6, and 8-20 of the '558 patent; and claims 1-6, 
8, 10, and 16-17 of the '490 patent. Comm'n Notice (July 17, 2018) 
(aff'g Order No. 43); Comm'n Notice (May 23, 2018) (aff'g Order No. 
37); Comm'n Notice (Apr. 6, 2018) (aff'g Order No. 34); Comm'n Notice 
(Mar. 22, 2018) (aff'g Order No. 24); Comm'n Notice (Sept. 20, 2017) 
(aff'g Order No. 6). The only claims still at issue are claim 31 of the 
'490 patent, claim 7 of the '558 patent, and claims 19, 25, and 27 of 
the '936 patent.
    The presiding administrative law judge (``ALJ'') originally set a 
target date for completion of this investigation within 17 months, 
i.e., by January 14, 2019. Comm'n Notice (Sept. 11, 2017) (aff'g Order 
No. 3). The Commission subsequently agreed to extend the target date to 
January 28, 2019. Comm'n Notice (Sept. 26, 2018) (aff'g Order No. 44). 
The Commission also extended the date for determining whether to review 
the subject ID to December 12, 2018. Comm'n Notice (Nov. 9, 2018).
    The ALJ held an evidentiary hearing from June 19-27, 2018. On 
September 28, 2018, the ALJ issued his final initial determination in 
this investigation. The ALJ found a violation of Section 337 due to 
infringement of the '490 patent. ID at 197. The ALJ found no 
infringement and hence no violation of Section 337 with respect to the 
'558 patent or '936 patent. Id. The ALJ found that Qualcomm satisfied 
the technical and economic prongs of the domestic industry requirement 
with respect to the '490 patent, but did not satisfy the technical 
prong with respect to the '558 patent or '936 patent. Id. The ALJ also 
found that it was not shown by clear and convincing evidence that any 
asserted claim was invalid. Id. The ALJ further recommended that no 
limited exclusion order or cease-and-desist order be issued in this 
investigation due to their prospective effects on competitive 
conditions in the United States, national security, and other public 
interest concerns. Id. at 199-200. The ALJ recommended that bond be set 
at zero-percent of entered value during the Presidential review period, 
if any. Id. at 201.
    Apple and Qualcomm filed their respective petitions for review on 
October 15, 2018. The parties, including OUII, filed their respective 
responses to the petitions on October 23, 2018. The Commission has also 
received a number of public interest statements from third parties, 
including Intel Corporation; ACT/The App Association; the American 
Antitrust Institute; the American Conservative Union; Americans for 
Limited Government; the Computer and Communications Industry 
Association; Conservatives for Property Rights; Frances Brevets (a 
patent sovereign fund); Frontiers of Freedom; Innovation Alliance; 
Inventors Digest; IP Europe; Public Knowledge and Open Markets (a joint 
submission); RED Technologies; R Street Institute, the Electronic 
Frontier Foundation, Engine Advocacy, and Lincoln Network (a joint 
submission), et al.
    Having reviewed the record in this investigation, including the 
ALJ's orders and final ID, as well as the parties' petitions and 
responses thereto, the Commission has determined to review the final ID 
in part, as follows.
    As to the 490 patent, the Commission has determined to review the 
ALJ's construction of the term ``hold'' and his findings on 
infringement and the technical prong of domestic industry to the extent 
they may be affected by that claim construction. The Commission has 
further determined to review the ALJ's findings as to whether claim 31 
of the '490 patent is obvious.
    The Commission has determined not to review any of the ALJ's 
findings with respect to the '558 patent or the '936 patent.
    The Commission has also determined not to review the ALJ's findings 
with respect to the economic prong of the domestic industry 
requirement.
    The parties are asked to provide additional briefing on the 
following issues regarding the '490 patent, with appropriate reference 
to the applicable law and the existing evidentiary record. For each 
argument presented, the parties' submissions should set forth whether 
and/or how that argument was presented and preserved in the proceedings 
before the ALJ, in conformity with the ALJ's Ground Rules (Order No. 
2), with citations to the record:
    A. With regard to the '490 patent, please explain the plain and 
ordinary meaning of the term ``hold'' in the context of claim 31 of 
this patent. In particular, explain whether the ordinary meaning of 
``hold'' can mean both ``to store, buffer, or accumulate'' data and 
``to prevent data from traveling across the bus,'' or whether ``hold'' 
must be limited to one construction or the other.
    B. Assuming ``hold'' could be interpreted to mean ``to store, 
buffer, or accumulate'' data and ``to prevent data from traveling 
across the bus,'' as set forth in Question (A), explain whether that 
construction would affect the ALJ's findings on infringement or the 
technical prong of domestic industry, and if so, how.
    C. Assuming ``hold'' could be interpreted to mean ``to store, 
buffer, or accumulate'' data and ``to prevent data from traveling 
across the bus,'' as set forth in Question (A), explain whether that 
construction would affect the ALJ's analysis of either the Heinrich 
patent (U.S. Patent No. 9,329,671) or the Balasubramanian patent (U.S. 
Patent No. 8,160,000) or his findings on obviousness, and if so, how.
    D. The Heinrich patent, supra, explains that a scheduler may be 
implemented either through software or hardware to control 
interprocessor communications in both directions across a bus. See 
Heinrich at 4:44-50, 7:8-21, 8:1-5. Heinrich further teaches that the 
scheduler can monitor the active state of the receiving processor by 
monitoring the active state of the IPC bus. See id. at 9:50-62. Explain 
whether the active state of the bus connecting the two processors in 
Heinrich coincides with or is otherwise related to the active state(s) 
of the processor(s) receiving the transmission across the bus. If so, 
explain whether monitoring the active state of the receiving processor 
(by monitoring the bus) and timing data transmissions to coincide with 
the active state of the receiving processor(s) will directly, 
indirectly, or inherently cause the transmissions to coincide with the 
active state of the bus.
    E. Based on your answer to Question (D), explain whether Heinrich's 
technique of grouping and scheduling transmissions to minimize the 
number of times a receiving processor switches between its active and 
sleep states will also minimize the number of times the bus switches 
between its active and sleep states.
    F. Taking into consideration the ALJ's construction of ``after 
transmission,'' explain whether a scheduler that monitors the active 
states of both processors (i.e., the application and baseband 
processors) and controls

[[Page 64877]]

transmissions in both directions across the bus to coincide with the 
active state of each receiving processor will, in the course of its 
operation, directly, indirectly, or inherently ``pull'' uplink data 
from the application processor after the scheduler has initiated 
transmission of downlink data from the modem processor, as in claim 31.
    G. Explain whether the scheduler and/or lazy timers in Heinrich may 
comprise a ``modem timer'' and perform the functions of a modem 
processor in claim 31.
    H. Explain whether the Balasubramanian patent includes any 
disclosures or teachings relevant to Questions D-G for purposes of 
analyzing obviousness.
    I. Explain whether there is a long-felt but unmet need for the 
invention of the '490 patent, focusing particularly on evidence of a 
nexus between the invention and this secondary consideration of non-
obviousness.
    The parties are requested to brief only the discrete issues 
identified above, with reference to the applicable law and evidentiary 
record. The parties are not to brief any other issues on review, which 
have already been adequately presented in the parties' previous 
filings.
    In connection with the final disposition of this investigation, the 
Commission may issue: (1) An exclusion order that could result in the 
exclusion of the subject articles from entry into the United States, 
and/or (2) a cease-and-desist order that could result in the respondent 
being required to cease and desist from engaging in unfair acts in the 
importation and sale of such articles. Accordingly, the Commission is 
interested in receiving written submissions that address the form of 
remedy, if any, that should be ordered. If a party seeks exclusion of 
an article from entry into the United States for purposes other than 
entry for consumption, the party should so indicate and provide 
information establishing that activities involving other types of entry 
either are adversely affecting it or likely to do so. For background, 
see Certain Devices for Connecting Computers via Telephone Lines, Inv. 
No. 337-TA-360, USITC Pub. No. 2843 (December 1994) (Commission 
Opinion).
    If the Commission contemplates some form of remedy, it must 
consider the effects of that remedy upon the public interest. The 
factors the Commission will consider include the effect that an 
exclusion order and/or cease-and-desist order would have on: (1) The 
public health and welfare; (2) competitive conditions in the U.S. 
economy; (3) U.S. production of articles that are like or directly 
competitive with those that are subject to investigation; and (4) U.S. 
consumers. The Commission is therefore interested in receiving written 
submissions that address the aforementioned public interest factors in 
the context of this investigation.
    Accordingly, the Commission is interested in receiving responses to 
the following questions. For the purpose of preparing their responses, 
the parties should assume that a violation of Section 337 has been 
found with respect to claim 31 of the '490 patent only. No other patent 
or patent claim has been found to be infringed.
    A. Assuming the Commission were to affirm the ALJ's finding that 
only claim 31 of '490 patent is infringed and not invalid, explain the 
likelihood that Apple or Intel could design around the claimed 
invention to avoid infringement and, if so, approximately how long it 
would take to implement such a design-around in Apple's accused 
products (if known).
    B. Explain whether and to what extent Intel supplies the same 
chipsets used in the accused Apple iPhones to any other U.S. merchant 
for use in any other products that are made, used, or sold in the 
United States or imported into the United States.
    C. Explain whether the ``carve-outs'' proposed by the Office of 
Unfair Import Investigations would be practicable, feasible, and would 
effectively balance enforcement of Qualcomm's '490 patent rights 
against the interest of avoiding Intel's exit from the relevant market 
for premium baseband chipsets.
    D. Explain whether delaying implementation of a limited exclusion 
order or cease-and-desist order for a fixed period of time (e.g., six 
months or one year) would effectively balance enforcement of Qualcomm's 
patent rights against the adverse consequences alleged by the parties 
with respect to industry competition, monopolization, the alleged exit 
of Apple's chipset supplier from the market for 5G technology, and 
other concerns. If not, explain whether any other ``carve-out'' or 
limitation in a remedial order can accomplish this objective.
    E. Explain whether national security concerns may be taken into 
consideration for the purpose of evaluating the public interest and, if 
so, whether and how such national security concerns would be implicated 
if a limited exclusion order were to issue covering products that 
infringe claim 31 of the '490 patent.
    If the Commission orders some form of remedy, the U.S. Trade 
Representative, as delegated by the President, has 60 days to approve 
or disapprove the Commission's action. See Presidential Memorandum of 
July 21, 2005. 70 Fed. Reg. 43251 (July 26, 2005). During this period, 
the subject articles would be entitled to enter the United States under 
bond, in an amount determined by the Commission and prescribed by the 
Secretary of the Treasury. The Commission is therefore interested in 
receiving submissions concerning the amount of the bond that should be 
imposed if a remedy is ordered.
    The Commission has determined to extend the target date for 
completion of this investigation to February 19, 2019.
    Written Submissions: The parties to this investigation are 
requested to file written submissions on the issues identified in this 
Notice. Parties to the investigation, interested government agencies, 
and any other interested parties are also encouraged to file written 
submissions on the issues of remedy, the public interest, and bonding. 
Such submissions should address the recommended determination by the 
ALJ on remedy and bonding. Complainant and OUII are requested to submit 
proposed remedial orders for the Commission's consideration. 
Complainant is also requested to state the date that the patents expire 
and the HTSUS numbers under which the accused products are imported. 
Complainant is further requested to supply the names of known importers 
of the Respondent's products at issue in this investigation. The 
written submissions and proposed remedial orders must be filed no later 
than the close of business on January 3, 2019. Reply submissions must 
be filed no later than the close of business on January 10, 2019. 
Opening submissions are limited to 60 pages. Reply submissions are 
limited to 40 pages. Such submissions should address the ALJ's 
recommended determination on remedy and bonding. No further submissions 
on any of these issues will be permitted unless otherwise ordered by 
the Commission.

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    Persons filing written submissions must file the original document 
electronically on or before the deadlines stated above and submit eight 
(8) true paper copies to the Office of the Secretary by noon the next 
day, pursuant to section 201.4(f) of the Commission's Rule of Practice 
and Procedure (19 CFR 210.4(f)). Submissions should refer to the 
investigation number (``Inv. No. 337-TA-1065'') in a prominent place on 
the cover page and/or first page. (See Handbook for Electronic Filing 
Procedures, https://www.usitc.gov/documents/handbook_on_filing_procedures.pdf). Persons with questions regarding 
filing should contact the Secretary (202-205-2000).
    Any person desiring to submit a document to the Commission in 
confidence must request confidential treatment. All such requests 
should be directed to the Secretary to the Commission and include a 
full statement of the reasons why the Commission should grant such 
treatment. See 19 CFR 201.6. Documents for which confidential treatment 
by the Commission is properly sought will be treated accordingly. All 
information, including confidential business information and documents 
for which confidential treatment is properly sought, submitted to the 
Commission for purposes of this Investigation may be disclosed to and 
used: (i) By the Commission, its employees and Offices, and contract 
personnel (a) for developing or maintaining the records of this or a 
related proceeding, or (b) in internal investigations, audits, reviews, 
and evaluations relating to the programs, personnel, and operations of 
the Commission including under 5 U.S.C. Appendix 3; or (ii) by U.S. 
government employees and contract personnel \1\ solely for 
cybersecurity purposes. All non-confidential written submissions will 
be available for public inspection at the Office of the Secretary and 
on EDIS.
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    \1\ All contract personnel will sign appropriate nondisclosure 
agreements.
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    The authority for the Commission's determination is contained in 
Section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and 
in part 210 of the Commission's Rules of Practice and Procedure (19 CFR 
part 210).

    By order of the Commission.

    Issued: December 12, 2018.
Lisa Barton,
Secretary to the Commission.
[FR Doc. 2018-27301 Filed 12-17-18; 8:45 am]
BILLING CODE 7020-02-P