[Federal Register Volume 62, Number 161 (Wednesday, August 20, 1997)]
[Notices]
[Pages 44291-44292]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-22052]


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INTERNATIONAL TRADE COMMISSION

[Inv. No. 337-TA-376]


Certain Variable Speed Wind Turbines and Components Thereof; 
Notice of Commission Determinations Concerning Federal Circuit Remand 
Question and Respondents' Motion To Show Cause and Petition for 
Rescission of Limited Exclusion Order

AGENCY: U.S. International Trade Commission.

ACTION: Notice.

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SUMMARY: Notice is hereby given that, in response to an order issued by 
the U.S. Court of Appeals for the Federal Circuit (``the Federal 
Circuit'') on April 24, 1997 (the ``remand order''), the U.S. 
International Trade Commission determined that the requirement of 
section 337(a)(3), 19 U.S.C. Sec. 1337(a)(3), regarding the presence of 
a domestic industry is satisfied by the domestic activities of Zond and 
the domestic activities of the companies licensed by Zond to practice 
the invention of claim 131 of U.S. Letters Patent 5,083,039.

[[Page 44292]]

Thus, the Commission determined that, by virtue of its ownership of the 
`039 patent and its licensing of significant domestic activities 
practicing that patent, Zond is part of the domestic industry. The 
Commission also determined that further proceedings are not necessary 
to resolve any factual issues presented by the question posed by the 
Court on remand, and to deny respondents' motion to show cause and 
their petition to rescind the limited exclusion order. The Commission 
will issue an opinion shortly concerning these issues.

FOR FURTHER INFORMATION CONTACT: Jay H. Reiziss, Esq., Office of the 
GeneralCounsel, U.S. International Trade Commission, telephone 202-205-
3116.

SUPPLEMENTARY INFORMATION: This patent-based section 337 investigation 
was conducted by the Commission in 1995 and 1996 based on a complaint 
filed by Kenetech Windpower, Inc., of Livermore, California 
(``Kenetech'') to determine whether there was a violation of section 
337 in the importation, sale for importation, and/or the sale within 
the United States after importation, of certain variable speed wind 
turbines and components thereof by reason of infringement of claim 131 
of U.S. Letters Patent 5,083,039 (``the `039 patent'') and claim 51 of 
U.S. Letters Patent 5,225,712 (``the `712 patent''), both owned by 
Kenetech. Enercon GmbH of Aurich, Germany (``Enercon'') and The New 
World Power Corporation of Lime Rock, Connecticut were named as 
respondents (collectively ``respondents''). The Commission found a 
violation of section 337 had occurred and issued a limited exclusion 
order. Because Kenetech had filed for bankruptcy under Chapter 11 of 
theU.S. Bankruptcy Act by the time the exclusion order was issued, and 
had by then ceased manufacturing wind turbines, the Commission required 
Kenetech to submit quarterly reports detailing its domestic activities 
exploiting the `039 patent.
    After the President declined to disapprove the Commission's 
determination, Enercon appealed to the Federal Circuit. Subsequently, 
in its March 31, 1997, quarterly report, Kenetech informed the 
Commission that it had sold the `039 patent to Zond Energy Systems, 
Incorporated (``Zond''). That quarterly report states that Kenetech 
continues to exploit the `039 patent, apparently under license from 
Zond.
    Before any briefs were submitted in the appeal, but after the time 
for filing a motion to intervene had expired, Zond moved to intervene, 
asserting that it had standing to intervene based on its ownership of 
the patent in issue. Enercon opposed Zond's intervention, arguing that 
Zond must first show that it qualifies as a domestic industry under 
section 337 in order to enter an appearance in the appeal, and that 
Zond had failed to show it had the requisite standing to participate in 
the appeal. On April 24, 1997, the Federal Circuit issued an order 
remanding the case to the Commission for the Commission to determine in 
the first instance: (1) ``whether Zond should be substituted for 
Kenetech;'' and (2) ``whether Zond qualifies as a domestic industry.''
    The Commission reopened this investigation, reinstated the 
protective order issued in this investigation, and requested comments 
from the parties' counsel on the questions posed by the Federal Circuit 
remand. On June 12, 1997, Zond filed a motion to intervene in this 
investigation. On July 8, 1997, the Commission issued an order 
permitting Zond to intervene in the remand proceeding as a co-
complainant. Zond's motion effectively presented the Commission with 
the same issue posed by the Federal Circuit's first remand question. 
The Commission has concluded that its decision on the motion to 
intervene is equally applicable to the first remand issue. Thus, in 
response to the first of the Federal Circuit's remand questions, the 
Commission has determined that, rather than substituting Zond for 
Kenetech, Zond should be permitted to intervene as a co-complainant. 
See Order Granting Motion to Intervene of Patent Owner Zond Energy 
Systems, Inc. (July 8, 1997).
    On June 16, 1997, respondents and the Commission investigative 
attorney (``IA'') filed comments on the remand issues, and on June 23, 
1997, all parties filed reply comments.
    On June 27, 1997, respondents filed a motion for an order to show 
cause why the law firm of Howrey & Simon should not be deemed 
continuing counsel to Kenetech. Howrey & Simon and the IA subsequently 
responded to that motion. On July 9, 1997, Howrey & Simon filed a 
notice of withdrawal as counsel to Kenetech.
    On July 2, 1997, respondents filed a petition under Commission rule 
210.76(a)(2) seeking rescission of the exclusion order issued by the 
Commission on August 30, 1996. Both Zond and the IA filed responses in 
opposition to that petition.
    Copies of the Commission's order, the public version of the opinion 
in support of that order and all other nonconfidential 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, D.C. 20436, telephone 202-205-2000. Hearing-
impaired persons are advised that information on this matter can be 
obtained by contacting the Commission's TDD terminal on 202-205-1810.
    This action is taken under the authority of section 337 of the 
Tariff Act of 1930, as amended (19 U.S.C. Sec. 1337), and section 
210.76 of the Commission's Rules of Practice and Procedure (19 C.F.R. 
Sec. 210.76).

    Issued: August 11, 1997.

    By order of the Commission.
Donna R. Koehnke,
Secretary.
[FR Doc. 97-22052 Filed 8-19-97; 8:45 am]
BILLING CODE 7020-02-P