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Apr 7, 2021Legal
Patexia Insight 102: ITC Found No Violation in 14% of Investigations

Last month we released our second annual ITC Intelligence Report. This popular report evaluated and ranked all stakeholders in ITC investigations including attorneys, law firms, respondents, and complainants by activity and performance for the past six years. From January 1, 2015 through December 31, 2020, a total of 335 ITC Section 337 investigations were filed. This week, we reviewed all violation investigations to determine the outcomes of the terminated cases for this period.

Referencing the bar chart below, the total number of ITC investigations filed between January 1, 2015, through December 31, 2020, was 335. These investigations were centered around 969 unique US patents. In 2020, we saw a 25 percent increase in the number of investigations (51 cases in 2019 vs. 64 cases in 2020). This indicates that ITC as a venue for patent litigation is becoming more popular. In our annual report, we also covered that since late 2019 more than 70 ITC attorneys among the top 1000 most active ones changed their firms or started a new firm. In Patexia Insight 101, we reported that several firms opened their DC offices recently, only for this purpose and to represent their clients before the International Trade Commission.

Although the violation type is the most popular investigation and covers the majority of the ITC Section 337 investigations, not all investigations are for violation. The following bar chart shows the distribution of ITC investigations and the popularity of all types. 309 out of 335 or more than 92 percent of all investigations are the violation type. And the remaining investigations fall into one of the other types including Modification, Enforcement, Advisory, and Bond Forfeiture.

To determine the outcome, our research team only focused on the violation type and analyzed 253 violation investigations (out of 309), which were terminated as of March 4, 2021. Our research team reviewed the Commission Determination documents provided by Office of the Secretary and available through the EDIS website to further determine the final outcomes. We categorized all the 253 violation investigation cases into eight possible outcomes as illustrated by the following bar chart.

Of the 253 terminated violation investigations, 77 (30%) of them went to some form of settlement before adjudication of a 337 decision; 49 (19%) were withdrawn; 42 (17%) were ruled a violation with LEO/GEO/CDO; 36 (14%) were ruled no violation; 27 (11%) were multiple decisions; 10 (4%) settled after a 337 violation ruling; 7 (3%) settled by consent order, and 5 (2%) were defaults with summary judgment. The “multiple decision” category can result in any of the other outcomes for the participant parties and means that the case had multiple respondents named and some of them left the case with different outcomes, resulting in different scores for different case participants.

As shown above, almost ⅓ of all ITC Section 337 investigations are settled. In 1/7th or approximately 14% of investigations, ITC finds no violation.

To measure the performance of all stakeholders, we considered each of the above outcomes and then, allocated points to the complainants and respondents, as well as their representatives, and judges. The following table shows how the points were allocated. To come up with this table, we consulted several experienced ITC attorneys and then conducted a survey.

 

OutcomeComplainantRespondentComp. Atty/FirmResp. Atty/FirJudge
 
Withdrawn0.250.750.250.75-
No Violation01010
Settlement0.50.50.50.5-
Consent Order0.750.250.750.25-
Violation, Settlement0.750.250.750.25-
Violation, LEO/GEO/CDO10101
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The summary of our survey results has been included in the full ITC Intelligence report. In the following weeks, we plan to publish some of the best ITC attorneys and law firms based on the above ranking methodology and as published in our latest report. Stay tuned!

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