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

Heading: Legislative History and Statutory Policy

Text: Nothing in nearly a century of U.S. trade law enactments is inconsistent with the Commission’s interpretation. The legislative history consistently evidences Congressional intent to vest the Commission with broad enforcement authority to remedy unfair trade acts. The United States Tariff Commission (“Tariff Commission”), the predecessor to the Commission, was established in 1916. Pub. L. No. 64-271, 39 Stat. 795 (1916). From its creation, a fundamental purpose of the Tariff Commission was to prevent a diverse array of unfair methods of competition in the importation of goods. 5 Recognizing the challenges posed by the wide array of unfair methods of competition, Congress emphasized the broad scope of the enforcement powers granted to the Tariff Commission when it passed the 1922 Tariff Act. With respect to Section 316 of the 1922 Tariff Act, the precursor to Section 337, Congress explained that the “provision relating to unfair methods of competition in the importation of goods,” was “broad enough to prevent every type and form 5 Unfair methods of competition have included dumping, subsidies, safeguards, anticompetitive practices, and violations of intellectual property rights, all involving the cross-border movement of goods, i.e., articles. See, e.g., 42 Stat. 935-36, 943 (1922). 22 SUPREMA, INC. v. ITC of unfair practice . . . .” S. Rep. No. 67-595, at 3 (1922) (emphasis added). In the Tariff Act of 1930, Congress superseded Section 316 with Section 337, but did not alter the Tariff Commission’s broad authority to address every type and form of unfair trade practice. See Pub. L. No. 71-361, 46 Stat. 590 (1930). Section 337 “provides broadly for action by the Tariff Commission in cases involving ‘unfair methods of competition and unfair acts in the importation of articles’ but does not define those terms nor set up a definite standard.” In re Von Clemm, 229 F.2d 441, 443 (C.C.P.A. 1955). When Congress used the words “unfair methods of competition and unfair acts in the importation of articles,” that language is “broad and inclusive and should not be limited to, or by, technical definitions of those types of acts.” Id. at 444 (emphasis added). For nearly 35 years, the Commission has embraced its Congressional grant as bestowing authority to investigate and take action under Section 337 based on induced infringement. At least as early as 1980, the Commission was making determinations that inducement to infringe a valid U.S. patent under 35 U.S.C. § 271(b) constituted an unfair trade act under Section 337 that could be remedied by an exclusion order. E.g., Certain Surveying Devices, Inv. No. 337-TA-68, USITC Pub. 1085 (July 1980) (Commission Determination). The Commission has persisted in its interpretation of Section 337 to the present day. 6 6 See, e.g., Certain Inkjet Ink Cartridges with Printheads and Components Thereof, Inv. No. 337-TA-723, USITC Pub. 4373 (Feb. 2013), 2011 WL 3489151, at  (June 10, 2011) (Initial Determination); Certain Semiconductor Chips Having Synchronous Dynamic Random Access Memory Controllers and Prods. Containing Same, Inv. No. 337-TA-661, USITC Pub. 4266 (Oct. 2011), Initial Determination at 42, 2011 WL 6017982, at  (Jan. 22, SUPREMA, INC. v. ITC 23 The Commission’s consistency supports the reasonableness of its interpretation. See, e.g., Astrue v. Capato ex rel. B.N.C., 132 S. Ct. 2021, 2033 (2012) (noting that agency’s reasonable interpretation was “adhered to without deviation for many decades”). Congress has not upset the Commission’s consistent interpretation of Section 337. Indeed, Congress introduced the current statutory language in 1988, after the Commission had adopted this interpretation. See note 6, supra. Congress acted against a backdrop of consistent agency and judicial interpretation emphasizing the breadth of the Commission’s authority. See, e.g., Von Clemm, 229 F.2d at 443–44 (the Commission’s power to remedy acts of unfair competition is “broad and inclusive”); In re Orion Co., 71 F.2d 458, 467 (C.C.P.A. 1934) (Section 337’s prohibition on “unfair methods of competi- 2010); Certain Automated Mechanical Transmission Sys. for Medium–Duty and Heavy-Duty Trucks and Compo- nents Thereof, Inv. No. 337-TA-503, USITC Pub. 3934 (Aug. 2007), Initial Determination at 154, 2007 WL 4473082, at  (Jan. 7, 2005); Certain Hardware Logic Emulation Systems and Components Thereof, Inv. No. 337-TA-383, USITC Pub. 3154 (Jan. 1999), Comm’n Notice at 2 (Mar. 6, 1998), Initial Determination at 179, 1997 WL 665006, at  (July 31, 1997); Certain MoldedIn Sandwich Panel Inserts and Methods for Their Installation, Inv. No. 337-TA-99, USITC Pub. 1246 (May 1982), Comm’n Op. at 8 (Apr. 9, 1982), aff’d sub nom., Young Eng’rs, Inc. v. Int’l Trade Comm’n, 721 F.2d 1305 (Fed. Cir. 1983). We note that we provide, here, only a small portion of the Commission’s induced infringement determinations to show that they were made throughout the past 35 years. A more comprehensive list of the Commission’s induced infringement determinations under Section 337 can be found at Suprema, 742 F.3d at 1372 n.2. 24 SUPREMA, INC. v. ITC tion in the importation of goods is broad enough to prevent every type and form of unfair practice”) (quoting S. Rep. No. 67-595, at 3 (1922)). There is no indication that Congress, in 1988, meant to contract the Commission’s authority regarding patent infringement. To the contrary, Congress said it was expanding Commission authority. Congress amended Section 337 in 1988, removing the requirement that a complainant must show injury to domestic industry before a violation is found. Omnibus Trade and Competitiveness Act of 1988, Pub. L. No. 100418, 102 Stat. 1107 (1988) (codified at Section 337(a)(2)- (3)). As a part of this effort, the 1988 Act inserted the phrase “articles that infringe.” Id. Congress declared its purpose to enhance Commission authority. 7 The “fundamental purpose” of the 1988 amendment was to “strengthen the effectiveness of section 337” against the “importation of articles which infringe U.S. intellectual property rights.” H.R. Rep. No. 100-40, pt. 1, at 155 (1987); see also H.R. Rep. No. 100-576, at 112 (1988) (Congressional finding that the amendments to Section 337 “make it a more effective remedy for the protection of United States intellectual property rights”). The Com- 7 “(a) FINDINGS. — The Congress finds that — (1) United States persons that rely on protection of intellectual property rights are among the most advanced and competitive in the world; and (2) the existing protection under section 337 of the Tariff Act of 1930 against unfair trade practices is cumbersome and costly and has not provided United States owners of intellectual property rights with adequate protection against foreign companies violating such rights. (b) PURPOSE. — The purpose of this part is to amend section 337 of the Tariff Act of 1930 to make it a more effective remedy for the protection of United States intellectual property rights.” § 1341, 102 Stat. 1211-1212. SUPREMA, INC. v. ITC 25 mission’s interpretation is consistent with Congress’ longstanding, broad policy, and with its broadening purpose in 1988. This court has consistently affirmed the Commission’s determination that a violation of Section 337 may arise from an act of induced infringement. See, e.g., Young Eng’rs Inc. v. Int’l Trade Comm’n, 721 F.2d 1305 (Fed. Cir. 1983) (affirming Section 337 violation based on contributory and induced infringement of process patents); Vizio, Inc. v. Int’l Trade Comm’n, 605 F.3d 1330 (Fed. Cir. 2010) (affirming Section 337 violation based on induced infringement of method claim); Emcore Corp. v. Int’l Trade Comm’n, 449 F. App’x 918 (Fed. Cir. 2011) (affirming without opinion Section 337 violation based on induced infringement of apparatus claim). Prior to this case, none of our reviews of the Commission’s determinations have questioned the Commission’s authority to investigate and find a violation of Section 337 predicated on an act of induced infringement. The technical interpretation adopted by the panel weakens the Commission’s overall ability to prevent unfair trade acts involving infringement of a U.S. patent. The panel’s interpretation of Section 337 would eliminate relief for a distinct unfair trade act and induced infringement. There is no basis for curtailing the Commission’s gap-filling authority in that way. Indeed, the practical consequence would be an open invitation to foreign entities (which might for various reasons not be subject to a district court injunction) to circumvent Section 337 by importing articles in a state requiring post-importation combination or modification before direct infringement could be shown. The Commission reasonably determined that its interpretation would further the purpose of the statute. See Mayo Found. for Med. Educ. & Research v. United States, 562 U.S. 44, 59 (2011) (purpose of a statute is relevant to 26 SUPREMA, INC. v. ITC Chevron Step Two). Congress enacted a legal regime for enforcement against unfair trade acts by directing the Commission to base Section 337 relief on goods and the issuance of exclusion orders to bar their importation. Absent unconstitutionality, we must defer to that regime. See, e.g., Beck v. Sec’y of Dep’t of Health & Human Servs., 924 F.2d 1029, 1034 (Fed. Cir. 1991) (“Our duty is limited to interpreting the statute as it was enacted . . . .”). The Commission adopted a reasonable interpretation under it. We note that our deference to the Commission’s statutory interpretation in this case is hardly momentous. The court has consistently deferred to the Commission, recognizing the Commission’s technical expertise in deciding issues arising under Section 337, a statute Congress has entrusted the agency to administer. E.g., Farrel Corp. v. Int’l Trade Comm’n, 949 F.2d 1147, 1151 (Fed. Cir. 1991), superseded by statute, 19 U.S.C. § 1337(c); Enercon, 151 F.3d at 1381–83. We have concluded on several occasions that the court may not substitute its own interpretation of the statute for the agency’s reasonable interpretation. See, e.g., Wheatland Tube Co. v. United States, 495 F.3d 1355, 1360–61 (Fed. Cir. 2007); Corning Glass Works v. Int’l Trade Comm’n, 799 F.2d 1559, 1565 (Fed. Cir. 1986). We have routinely deferred to the agency’s reasonable interpretation of Section 337. See, e.g., Enercon, 151 F.3d at 1383 (affirming the Commission’s interpretation of the term “sale for importation” in Section 337 as reasonable); Kinik, 362 F.3d at 1363 (deferring to Commission’s interpretation of the interplay between Section 337 and 35 U.S.C. 271(g)); San Huan New Materials High Tech, Inc. v. Int’l Trade Comm’n, 161 F.3d 1347, 1357 (Fed. Cir. 1998) (affirming Commission’s reasonable interpretation of § 337(f)(2)).