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[Federal Register Volume 89, Number 220 (Thursday, November 14, 2024)]
[Notices]
[Pages 90051-90053]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-26431]

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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1366]

Certain Semiconductor Devices, and Methods of Manufacturing Same 
and Products Containing the Same Notice of the Commission's Final 
Determination Finding a Violation of Section 337; Issuance of a Limited 
Exclusion Order and Cease and Desist Orders; Denial of Motion for 
Sanctions; Termination of the Investigation

AGENCY: U.S. International Trade Commission.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the U.S. International Trade 
Commission (``Commission'') has determined that there is a violation of 
section 337 in the above-captioned investigation. The Commission has 
further determined to issue a limited

[[Page 90052]]

exclusion order and cease and desist orders and to set a bond in the 
amount of five percent (5%) of entered value for covered articles 
imported or sold during the period of Presidential review.

FOR FURTHER INFORMATION CONTACT: Panyin A. Hughes, Office of the 
General Counsel, U.S. International Trade Commission, 500 E Street SW, 
Washington, DC 20436, telephone (202) 205-3042. Copies of non-
confidential documents filed in connection with this investigation may 
be viewed on the Commission's electronic docket (EDIS) at https://edis.usitc.gov. For help accessing EDIS, please email 
[email protected]. General information concerning the Commission may 
also be obtained by accessing its internet server at https://www.usitc.gov. Hearing-impaired persons are advised that information on 
this matter can be obtained by contacting the Commission's TDD terminal 
on (202) 205-1810.

SUPPLEMENTARY INFORMATION: The Commission instituted this investigation 
on July 3, 2023, based on a complaint filed by Efficient Power 
Conversion Corporation of El Segundo, California (``EPC''). 88 FR 
42756-77 (Jul. 3, 2023). The complaint alleged violations of section 
337 of the Tariff Act of 1930, as amended, 19 U.S.C. 1337, based on the 
importation into the United States, the sale for importation, or sale 
within the United States after importation of certain semiconductor 
devices, and methods of manufacturing same, and products containing the 
same by reason of the infringement of one or more claims of U.S. Patent 
Nos. 10,312,335 (``the '335 patent''); 8,350,294 (``the '294 patent''); 
8,404,508 (``the '508 patent''); and 9,748,347 (``the '347 patent''). 
Id. The complaint further alleged that a domestic industry exists. Id. 
The Commission's notice of investigation named as respondents 
Innoscience (Zhuhai) Technology, Company, Ltd., of Zhuhai, Guangdong, 
China; and Innoscience America, Inc. of Santa Clara, California 
(together ``Innoscience'' or ``Respondents''). The Office of Unfair 
Import Investigations (``OUII'') was also named as a party in this 
investigation. Id.
    On October 13, 2023, Chief Administrative Law Judge (``CALJ'') held 
a Markman hearing.
    On December 13, 2023, the CALJ issued an initial determination 
(``ID'') granting a motion to terminate the investigation as to all 
asserted claims of the '347 patent. Order No. 9 (Dec. 13, 2023), 
unreviewed by Comm'n Notice (Jan. 11, 2024).
    On February 12, 2024, the CALJ issued an ID granting a motion to 
terminate the investigation as to all asserted claims of the '335 
patent. Order No. 12 (Feb. 12, 2024), unreviewed by Comm'n Notice (Mar. 
12, 2024).
    The CALJ held an evidentiary hearing from February 26, 2024 to 
March 1, 2024, and received post-hearing briefs thereafter.
    On July 5, 2024, the CALJ issued the final ID finding a violation 
of section 337 as to claims 2 and 3 of the '294 patent and no violation 
of section 337 as to claim 1 of the '294 patent. The CALJ also found no 
violation of section 337 as to the only asserted claim of the '508 
patent, claim 1. Specifically, the ID found that by appearing and 
participating in the investigation, the parties have consented to 
personal jurisdiction at the Commission. ID at 10-11. The ID found that 
EPC established the importation requirement under 19 U.S.C. 
1337(a)(1)(B), noting that Innoscience does not dispute importing the 
accused products. Id. at 11-12. The ID found that because the accused 
products have been imported into the United States, the Commission has 
in rem jurisdiction over them. Id. at 12. The ID found that EPC owns 
the patents and thus has standing to assert the patents in this 
investigation. Id. The ID found that EPC successfully proved that the 
accused products infringe the asserted claims of the '294 patent 
(claims 1-3) but that unlike claims 2 and 3, claim 1 has been shown to 
be invalid for obviousness. ID at 30-51, 85-100. The ID found that EPC 
failed to prove that the accused products infringe claim 1 of the '508 
patent and that Respondents failed to prove the claim invalid for 
obviousness. Id. at 52-68, 103-117. Finally, the ID found that EPC 
established the economic prong of the domestic industry requirement for 
both the '294 and '508 patents but failed to establish the technical 
prong of the domestic industry requirement for the '508 patent. ID at 
120-151. Thus, the ID found the existence of a domestic industry that 
practices the '294 patent as required by 19 U.S.C. 1337(a)(2) but not 
one that practices the '508 patent.
    The ID included the CALJ's recommended determination on remedy and 
bonding (``RD''). The RD recommended, should the Commission find a 
violation, issuance of a limited exclusion order and cease and desist 
orders against the Respondents. ID/RD at 154-157. The RD also 
recommended imposing a bond in the amount of five percent (5%) of 
entered value for infringing products imported during the period of 
Presidential review. Id. at 158-159.
    On July 19, 2024, EPC and Innoscience filed respective petitions 
for review of the ID. On July 29, 2024, the parties, including OUII, 
filed responses to the petitions.
    On August 6, 2024, Respondents filed a motion for sanctions against 
EPC and its counsel for their alleged breach of the CALJ's 
administrative protective order (``APO'') based on an alleged 
disclosure EPC made in IPR proceedings before the Patent Office. 
Respondents requested a sanction of non-enforcement of the '294 patent. 
Respondents also requested a stay of the proceedings pending 
disposition of the sanctions motion. On August 15, 2024, OUII filed a 
response, opposing Respondents' motion. On August 16, 2024, Complainant 
file an opposition to Respondents' motion. On September 19, 2024, 
Respondents filed a motion for leave to file a reply brief in support 
of its motion for sanctions. On September 24, 2024, EPC filed an 
opposition to Respondents' motion for leave to file a reply. On October 
2, 2024, OUII filed an opposition to Respondents' motion for leave to 
file a reply.
    The Commission has determined to deny Respondents' motion for leave 
to file a reply brief. The Commission has also determined to deny 
Respondents' motion for a sanction of non-enforcement of the '294 
patent. The Commission notes that Respondents' allegation of a breach 
of the APO has been referred to the Commission's Office of the 
Secretary for further proceedings according to the Commission's normal 
procedures. The Commission reminds the parties of their obligations 
under Commission Rule 210.25 to promptly file any allegations of breach 
of an APO, and to bring the matter to the attention of the presiding 
ALJ where, as here, the alleged breach is discovered while the 
investigation was pending before the CALJ. The Commission also reminds 
the parties of their obligation under Commission rule 210.34 to keep 
the identity of any alleged breacher confidential. The Commission has 
also determined to deny Respondent's request to stay the proceedings 
pending disposition of the sanctions motion.
    On September 5, 2024, the Commission determined to review the final 
ID in its entirety. 89 FR 73719-21 (Sept. 11, 2024). The Commission 
asked the parties briefing questions related to: (1) construction of 
the claim term ``compensated GaN layer'' recited in claim 1 of the '294 
patent and the ID's infringement, invalidity, and technical prong of 
the domestic industry analyses if the Commission were to adopt OUII's 
proposed construction of the term; (2)

[[Page 90053]]

invalidity finding of the '294 patent; (3) whether the only asserted 
claim of the '508 patent, claim 1, is limited to using a single mask to 
etch both the gate contact and doped GaN layer based on the '508 
patent's description of the ``present invention,'' as well as whether 
the claim steps must be performed in the order recited; and (4) whether 
EPC's ``total operating expenditures'' identified on page 129 of the ID 
includes foreign manufacturing expenses for the domestic industry 
products. Id.
    On September 23, 2023, the parties filed initial submissions in 
response to the Commission's request for briefing. On September 30, 
2023, the parties filed reply submissions.
    Upon review of the parties' submissions, the ID, the RD, evidence 
of record, and public interest filings, the Commission has determined 
that Respondents violated section 337 by reason of importation and sale 
of articles that infringe asserted claims 2 and 3 of the '294 patent 
and to issue remedial orders. The Commission has determined to clarify 
the ID's statements on jurisdiction and standing as noted in the 
accompanying Commission Opinion. The Commission has determined to adopt 
OUII's construction of the claim term ``compensated GaN layer'' recited 
in claim 1 of the '294 patent as its plain and ordinary meaning and, as 
explained in the Commission opinion, finds that adoption of OUII's 
construction does not alter the ID's findings on infringement, 
invalidity, and technical prong of domestic industry, which the 
Commission affirms. For the '508 patent, the Commission affirms the 
ID's finding of no violation for the reasons provided in the ID.
    For remedy, the Commission has determined to issue a limited 
exclusion order prohibiting further importation of infringing products 
and cease and desist orders against Respondents. The Commission has 
determined that the public interest factors do not counsel against 
issuing remedial orders. The Commission has determined that a bond in 
the amount of five percent (5%) of entered value for covered articles 
is required for covered products imported or sold during the period of 
Presidential review.
    The Commission vote for this determination took place on November 
7, 2024.
    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: November 7, 2024.
Lisa Barton,
Secretary to the Commission.
[FR Doc. 2024-26431 Filed 11-13-24; 8:45 am]
BILLING CODE 7020-02-P
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