CHAPTER 3 THE EVOLUTION OF LIMITED EXCLUSION ORDER RELIEF
3.4.4 Towards Limited Exclusion Order Relief
The first patent-based Limited Exclusion Order was granted to 337-TA-75 on June 19, 1981 (18 months after institution), which was shortly after the abolishing of “Exclusive Or”
doctrine. Between 337-TA-75 and 337-TA-90, the USITC granted three General Exclusion Orders to three investigations (all 12 months after institution) as remedy. We assume that the idea of Limited Exclusion Order had been available at the time for investigations 337-TA-82 and 337-TA-83’s determinations because the U.S. President, represented by the USTR, urged the USITC to grant a Limited Exclusion Order to 337-TA-82.
Inv. Decision Inv. No. ALJ Disposition
11/21/1979 11/21/1980 337-TA-74 Duvall GEO
04/08/1980 04/08/1981 337-TA-82 Duvall GEO
05/29/1980 05/19/1981 337-TA-83 Saxon GEO
12/19/1979 06/19/1981 337-TA-75 Duvall LEO
08/08/1980 08/10/1981 337-TA-88 Saxon GEO
11/21/1980 11/24/1981 337-TA-90 Duvall LEO
TABLE 3-6 EXCLUSION ORDERS ISSUED IN 1981
In 1981, the USITC had made five choices between General and Limited Exclusion Order relief. Based case profiling, such as comparing the number of involved respondents, this research assumes two investigations out of the five (337-TA-83 and 337-TA-88) were very unlikely to be eligible to Limited Exclusion Order relief. The ALJ would possibly issue General Exclusion Orders to these cases. We can safely rule out the possibility that these investigations were suitable to the Limited Exclusion Order experiment.
Respondents
337-TA- Title ALJ No. of
Patents Non-U.S. U.S
75 Large Video Matrix Display Systems and Components Duvall 4 1 1 82 Headboxes and Papermaking Machine Forming Sections
for the Continuous Production of Paper and Components
Duvall 3 2 5
82A Headboxes and Papermaking Machine Forming Sections for the Continuous Production of Paper and Components
Saxon 2 2 1
83 Adjustable Window Shades and Components Saxon 1 2 3
88 Spring Assemblies and Components Thereof, and Methods for Their Manufacture
Saxon 2 1 2
90 Airless Paint Spray Pumps and Components Duvall 3 2 3
TABLE 3-7 SELECTED 1981 INVESTIGATIONS
In Large Video Matrix Display Systems, Inv. No. 337-TA-75, the complainant named a Swiss manufacturer and a U.S.-based importer.197 The OUII proposed a General Exclusion Order with an additional in personam aspect. The proposed exclusion order included all essential elements of an exclusion order, and also prevented the Swiss firm from operating, maintaining, or repairing the system already in place. This order may be even more powerful than today’s one General Exclusion Order plus one Cease-and-Desist Order because this order was created to against good-willed buyers.
In Headboxes, Inv. No. 337-TA-82, the USITC’s Chairman proposed to trade General Exclusion Order with an in personam Cease-and-Desist Order (see Section 3.3.2.3). This was quite a normal proposal during the USITC’s earliest days. In the end, the USITC granted a
“classical” General Exclusion Order to the complainant.
Adjustable Window Shades and Components, Inv. No. 337-TA-83, involved a light
industry household product that could be easily copied by international manufacturers. The patent198 issues did not appear to be particularly complex: a limited Westlaw search suggests that neither the doctrine of equivalents nor prosecution history estoppel were at issue. This case falls into the many makers and many buyers category (Fourth Quadrant).The investigation Spring Assemblies and Components, Inv. No. 337-TA-88, was also about a product without a high entry barrier:199
We find that the appropriate remedy in this case is a general exclusion order, … . The cost of entry into the market for the subject spring assemblies is low relative to the automotive supply industry, … . The technology involved here is not extraordinarily complex. Moreover, the domestic producers know the technology and can give any one producer sufficient business to make a spring assembly operation profitable. Consequently, other producers could enter the market with relative ease, … . [A] new manufacturer, … could tool up and begin producing infringing spring assemblies in a matter of months. … Only a general exclusion order will prevent the entry into the United States of infringing imports from all sources. …
… [A] limited exclusion order and a cease and desist order would not provide effective relief. … [T]he remedy in this case must fully redress the
197 Certain Large Video Matrix Display Systems, and Components Thereof; Notice of Investigation, 44 Fed. Reg.
75242 (December 19, 1979). (SSIH Equipment S.A., a member of the Omega Electronics Group, of Bienne, Switzerland, and The Milwaukee Brewers Baseball Club, Inc., of Milwaukee, Wisconsin).
198 Window Shade Assembly, U.S. Patent No. 4,006,770 (filed Jun. 16, 1975) (issued Feb. 8, 1977). The Federal Circuit subsequently held the patent in suit invalid for obviousness in Newell Companies, Inc. v. Kenney Mfg.
Co., 864 F.2d 757 (Fed. Cir. 1988) .
199 1981 WL 178464.
unfair acts of all three respondents. … [T]he importation of infringing imports from other sources poses a real concern. A limited exclusion order would not be effective against [two largest buyers], … A cease and desist order would be difficult to enforce against [the Canadian manufacturer].
The market for spring assemblies consisted of many potential makers and only a few buyers (major U.S.-based car manufacturers). In contrast, Video Matrix Display System, 337-TA-75 related to a stadium scoreboard system that was costly, complex and built-on-demand.200 This case had only one maker and, possibly some buyers and potential buyers (Second Quadrant).
The papermaking headboxes of USITC Inv. Nos. 337-TA-82 and 337-TA-82A were also quite suitable for Limited Exclusion Order relief because this kind of products would never be supplied in an off-the-shelf manner cheaply and in quantities:201
To categorize above five cases using the decision matrix introduced in the last section, this research found cases highly eligible to Limited Exclusion Order were also to be suitable for Cease-and-Desist remedy:
Makers
Few Many
Few (II)
75, 82, 82A (I) 88
Buyers Many (III) (IV) 83
TABLE 3-8 CASE CHARACTERISTICS OF 1981 INVESTIGATIONS
In fact, at least in the cases of 337-TA-75 and 337-TA-82, the dissent opinions proposed to issue Cease-and-Desist Orders instead.
200 Large Video Matrix Display Systems, and Components Thereof, Recommended Determination (April 1, 1981). (Findings of Fact #186: “The cost of video display boards is at about $2,000,000; two or three sales a year is a good year.”).
201 Presidential Disapproval of Determination of the U.S. International Trade Commission in Investigation No.
337-TA-82, Certain Multi-ply Headboxes, 46 Fed. Reg. 32361 (June 22, 1981). (“The papermaking machinery industry is relatively transparent and the manufacturers and importers are few. Technological and economic barriers to entry in the industry are substantial, making sudden new entrants to the market unlikely. The time period between the placement of an order and importation of the machinery exceeds twelve months. Only three or four multi-ply headboxes are sold each year in the United States. The need for a broad exclusion order, therefore, is unnecessary to protect the patent assignee from a high volume of imports from constantly shifting manufacturers and importers.”).