Opinion ID: 3066230
Heading Depth: 2
Heading Rank: 3

Heading: Historical Commission Practice

Text: The majority and the government also assert that the statutory and legislative history supports its interpretation by demonstrating Congress’s intent to continue an unbroken practice by the Commission of predicating exclusion orders on acts of induced infringement. Maj. Op. at 21–23. Specifically, it states that “Congress has not upset the Commission’s consistent interpretation of Section 337.” Maj. Op. at 23. There has been no interpre18 SUPREMA, INC. v. ITC tation of § 337 that mirrors that adopted by the majority today, however, and certainly nothing so clear that Congress should be charged with jumping in to stop it. The cases the majority cites to support the sweeping statements it makes about the Commission’s unbroken practices do not bear the weight placed on them. Indeed, the government conceded as much at oral argument. See Oral Argument at 1:12–1:13, Suprema, Inc. v. International Trade Comm’n, No. 12-1170 (en banc), available at http://oralarguments.cafc.uscourts.gov/default.aspx?fl=20 12-1170_252015.mp3. The majority cites a single pre-1988 case in support of its “consistency theory”: Young Engineers, Inc. v. U.S. International Trade Commission, 721 F.2d 1305 (Fed. Cir. 1983). 4 Young Engineers did not involve an exclusion 4 The government relies heavily on Frischer & Co. v. Bakelite Corp., 39 F.2d 247 (C.C.P.A. 1930), to establish that the Commission had previously based exclusion orders on induced infringement. See, e.g., Br. of Int’l Trade Comm’n at 28–30, 32. Bakelite does not stand for what the government claims, however. The exclusion order in Bakelite was predicated on a finding that the imported articles were “prepared and manufactured in conformity” with the patented methods before being imported, which is consistent with the later-enacted prohibition on goods produced using patented methods prior to importation in § 1337(a)(1)(B)(ii). Id. at 507; see also In re Orion, 71 F.2d at 466–67 (finding that the import of products produced using infringing methods abroad could be considered an unfair method of competition or unfair act under the Tariff Act of 1930). Bakelite simply does not stand for the proposition that an exclusion order can be issued on the basis of induced infringement where the underlying direct infringement of a SUPREMA, INC. v. ITC 19 order predicated exclusively on a finding of induced infringement. The Commission issued an exclusion order both because of a finding of direct infringement due to the importation of an infringing product, and induced infringement on the basis of the importer providing “training and assistance to [ ] customers in the use of the inserts in accordance with the patented methods.” In re Certain Molded-In Sandwich Panel Inserts and Methods for Their Installation, USITC Inv. No. 337–TA–99, 218 U.S.P.Q. 832, at  (April 9, 1982), aff’d, Young Eng’rs, 721 F.2d at 1317. The Commission also concluded that the inserts at issue were not staple goods, and justified the exclusion order on a finding of contributory infringement. Id. We affirmed those findings without analysis of the Commission’s power to justify exclusion orders solely on a finding of induced infringement. Young Eng’rs, 721 F.2d at 1317. Young Engineers does not evidence that we have “consistently affirmed the Commission’s determination that a violation of Section 337 may arise from an act of induced infringement.” Maj. Op. at 25. At best, Young Engineers and Bakelite, see supra note 4, stand for the uncontroversial premise that the Commission can exclude either: (1) articles made using a patented method overseas pre-importation; or (2) non-staple goods imported into the United States on the basis of a finding of direct and induced infringement. In either situation, a Customs agent is not required to divine the importer’s intent to determine if there would be a potential downstream direct infringement. The direct infringement either already occurred prior to importation (and is statutorily covered under § 1337(a)(1)(B)(ii)) or the good itself could not be used in a non-infringing manner. This is a far cry from method claim occurs after importation, and might not occur at all. Unsurprisingly, the majority does not even attempt to rely on Bakelite. 20 SUPREMA, INC. v. ITC establishing a consistent agency practice of which Congress necessarily would have been aware in 1988, as the majority proclaims. Maj. Op. at 21–23. Standard Oil Co. v. Nippon Shokubai Kagaku Kogyo Co., 754 F.2d 345 (Fed. Cir. 1985) does not alter this analysis. In Standard Oil, we analyzed when the period for laches would begin to run for claims of induced infringement: at the time of the direct infringement or at the time of the inducing act. Id. at 348–49. We concluded that laches barred recovery because the specific intent to induce existed prior to the six-year period for laches, even though the subsequent direct infringement occurred during the laches period. Id. Standard Oil does not annunciate a rule that induced infringement occurs at the time of the inducing act, see Maj. Op. at 20—we held instead that, once the direct infringement occurs, the liability for induced infringement is traced back to the inducing act. Id.; see also Nat’l Presto Indus., Inc. v. W. Bend. Co., 76 F.3d 1185, 1196 (merely holding that there must be a direct infringement for liability under § 271(b) to exist). Nothing in Standard Oil alters the fact or requirement that there must be an underlying direct infringement for there to be induced infringement. Limelight, 134 S. Ct. at 2117. There is simply no evidence of any pre-1988 Commission practice equivalent to the Commission’s actions here. Even if reliance on congressional silence were ever a strong reed upon which to premise statutory interpretation, 5 the majority cannot rely on Congress’s purported 5 The Supreme Court has recognized that, absent circumstances not present here, congressional silence is, at best, a tenuous ground upon which to justify a particular statutory construction. See Cmty. for Creative NonViolence v. Reid, 490 U.S. 730, 749 (1989) (“Ordinarily, SUPREMA, INC. v. ITC 21 desire to continue a consistent past agency practice to bolster its statutory construction when the only consistent agency practice was the agency’s failure to assert § 337 against importers of staple goods based solely on the intent to induce infringement of method claims postimportation.