On October 24, an Administrative Law Judge (ALJ) of the International Trade Commission (ITC), a quasi-judicial agency that can impose import bans on patent-infringing products, made an initial determination (preliminary ruling) according to which Samsung was held to infringe four Apple patents (one phone design patent and three utility patents). Since the summary of those findings was announced, no details on the reasons and on the parties' petitions for review -- other than the fact that both parties did ask the Commission, the six-member decision-making body at the top of the ITC, to overrule the judge in their favor on some items -- entered the public record until today. Now, finally, there is at least one document containing substantive information that has been made available to the general public in a redacted form: the Office of Unfair Import Investigation's ("ITC staff") response to the private parties' (Apple and Samsung) petitions for review.
The ITC staff, which acts as a third party defending the public interest and makes recommendations that don't have to be adopted by the Commission or an ALJ, had not filed a petition of its own. In many of the investigations I have watched so far, the ITC staff also petitioned for a review. The fact that it did not do so in this case likely constituted a tacit form of support for the ALJ's findings, but theoretically there could have been other reasons for this, such as resource constraints.
Today's filing by the ITC staff (a redacted version of a filing that was already made ten days ago) affirmatively supports the initial determination, saying that the ALJ "did not commit legal or factual error" and that Samsung's petition should be denied in its entirety and Apple's in all respects except for one: one of the claims (claim 3) of one of the patents deemed infringed by some Samsung products, U.S. Patent No. 7,912,501 on an "audio I/O headset plug and plug detection circuitry", should additionally be considered to have been infringed by the SPH-M920, distributed through Sprint and also known as the Samsung Transform, but the ITC staff believes that this finding does not require a lengthy Commission review of the initial determination: the staff suggests to make this correction in the form of a conclusion of law.
If the Commission adopted the staff recommendation, a U.S. import ban against Samsung products having the characteristics underlying the infringement findings could enter very quickly. But as I explained in my comments on the announcement of the initial determination, it's strategically irrelevant which past products are banned if commercially viable workarounds (meaning that they don't result in degradations of the user experience and a loss of competitiveness) are available, and the initial determination cleared various unspecified Samsung workarounds of infringement. In the coming weeks I expect a redacted version of the initial determination as well as redacted versions of the parties' petitions (and their responses to each other's petitions) to become available, and as a result, we may all find out more about Samsung's workarounds.
The staff document filed today reflects the theories based on which Apple and Samsung would like to achieve improvements over the initial determination:
Apple obviously wants a broader ruling in its favor. Above all, it would like to prevail on the two patents the ALJ did not deem violated: U.S. Design Patent D558,757 on a certain "ornamental design for an electronic device" found on the iPhone 3GS (asserted against the Fascinate and Transform smartphones) and U.S. Patent No, 7,789,697 on "plug detection mechanisms". At the evidentiary hearing (i.e., trial), the ITC staff had sided with Apple on the D'757 patent, but it now respects the ALJ's factual determination, saying it is not "clearly erroneous, as is required to warrant Commission review". On the '697 patent the staff never appears to have sided with Apple.
While Apple's quest for a broader win is more about a nice-to-have than a must-have, Samsung really needs some improvements because a finding of four patent violations would look bad, even if Samsung could work around all of those patents without much commercial impact (again, the impact can't be assessed until the workarounds are described). Samsung's petition for review appears to re-raise pretty much every issue: claim construction, infringement, validity, domestic industry. Samsung also complains about "prejudicial procedural errors" relating to the admission or exclusion of certain evidence. But none of Samsung's arguments have persuaded the ITC staff that a review of the initial determination is warranted.
While the staff's position ups the ante for both parties' push for the ALJ to be overruled in different areas, I doubt that the ITC will order an import ban in such a high-profile case without any Commission review. I guess the parties will get the chance to comment again on some of the key issues raised in the petitions for review. This will also help the Commission to bulletproof its ruling for the appeals. In this case, the most likely scenario is that either party will appeal the unfavorable parts of the final ITC decision to the Federal Circuit.
If you'd like to be updated on the smartphone patent disputes and other intellectual property matters I cover, please subscribe to my RSS feed (in the right-hand column) and/or follow me on Twitter @FOSSpatents and Google+.
Share with other professionals via LinkedIn:
