Comcast v. ITC: Revisiting Suprema and the Scope of Section 337 - Part I
Time to read: 4 mins
On March 25, 2020, Comcast, joined by set-top-box suppliers ARRIS and Technicolor (referred to collectively herein as “Comcast”), petitioned the Supreme Court of the United States to review whether the Court of Appeals for the Federal Circuit erred in affirming the International Trade Commission’s (ITC) finding of violation of Section 337 related to Comcast’s Xfinity cable system, and corresponding exclusion of X1 STBs that are used therein.1 Comcast first contends the Federal Circuit’s judgment and ITC’s exclusion orders should be vacated as moot because the patents at issue expired while the case was pending appeal. Notwithstanding mootness, Comcast also contends the ITC exceeded its authority by holding the X1 STBs were “articles that infringe” and finding Comcast engaged in “importation” thereof under Section 337.2 These constitutional and statutory interpretation questions implicate the ITC’s authority and scope under Section 337. This blog series will highlight Section 337 issues arising out of this investigation and other updates related to the time of importation requirement.
Part I: ITC Decision and Federal Circuit Appeal
The ITC barred importation of X1 STBs after finding that Comcast induced its customers’ direct infringement and was an importer under Section 337.3 The ITC rejected Comcast’s argument that the inducement was entirely domestic and therefore not actionable under Section 337. Second, the ITC affirmed the administrative law judge’s (ALJ) finding that Comcast was an importer because Comcast was “sufficiently involved” in Technicolor’s and ARRIS’s importation of STBs. The ALJ found Comcast’s design required certain operability specifications and software solely attributable to Comcast that were incompatible with other cable operators’ systems.4
On appeal, Comcast challenged the ITC’s statutory authority to issue the exclusion orders, arguing, inter alia, that the finding of inducement does not make the STBs “articles that infringe” at the time of importation and that the finding that Comcast was an importer was legally deficient. During pendency of the appeal, Comcast moved for dismissal of the appeal, and vacatur of the underlying decision, due to the expiration of the patents that were the subject of the exclusion order. The Federal Circuit rejected the motion to dismiss, and issued an opinion affirming the ITC’s decision.5 The Federal Circuit denied dismissal on the basis of two additional pending ITC investigations involving the X1 STBs, concluding that sufficient collateral consequences negated mootness.
In affirming the ITC’s decision, the Federal Circuit relied on its holding in Suprema, which interpreted the phrase “articles that infringe” and repudiated a time-of-importation requirement. On that basis, the Federal Circuit rejected Comcast’s argument that Suprema limited the ITC’s authority to articles that infringe at the time of importation. The Federal Circuit also relied on its predecessor court's holding in In re Orion Co., which found that determining whether a party is an “importer” under Section 337 is a question of fact.6 Comcast argued that it was not an importer because ARRIS and Technicolor were the importers of record, and Comcast did not physically bring STBs into the U.S. or exercise any control over the importation process. The Federal Circuit reiterated the ALJ’S findings and quoted the ITC’s conclusion that “Section 337, as applied to Comcast’s relevant conduct here, requires importation of articles, proof of direct infringement, and proof of inducement, all of which have been established by the record.”7 Thus, the Federal Circuit concluded the ITC’s decision and remedial actions were in conformity with Section 337 precedent and supported by substantial evidence.
Our next post will address Comcast’s Petition for Writ of Certiorari to the Supreme Court.
June 4, 2020
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1 Petition for Writ of Certiorari, Comcast Corp. v. Int’l Trade Comm’n, No. 19-1173 (Mar. 25, 2020).
3 Certain Digital Video Receivers & Hardware & Software Components Thereof, Inv. No. 337-TA-1001, Comm’n Op. (Dec. 6, 2017).
4 Certain Digital Video Receivers & Hardware & Software Components Thereof, Inv. No. 337-TA-1001, Final Initial Determination (May 26, 2017).
5 Comcast Corp. v. Int’l Trade Comm’n, 951 F.3d 1301 (Fed. Cir. 2020).
6 In re Orion Co., 71 F.2d 458, 462 (C.C.P.A. 1934).
7 Comcast Corp., 951 F.3d at 1309.