Attention, Small Business Owners: The ITC Could Help You Enforce Your IP

The Federal Circuit's recent decision in Wuhan Healthgen Biotechnology Corp. v. U.S. International Trade Commission significantly alters the landscape for small companies seeking recourse against foreign infringers. The court affirmed the International Trade Commission’s (ITC) ruling that Ventria Bioscience, a smaller company (e.g., under 50 employees), met the domestic industry requirement despite its relatively modest investment in the patented cell culture product-at-issue. (The domestic industry requirement necessitates that a domestic industry, either in the form of a manufacturer or a producer, be significantly harmed or threatened with harm by reason of unfair imports.) The court rejected arguments that a specific dollar threshold determines sufficiency, instead emphasizing a holistic review considering the context and importance of the investment relative to the company's overall operations. This ruling clarifies that even limited domestic investment can suffice, making powerful import ban remedies of the ITC accessible to smaller businesses, including those technologies most often at-issue at the ITC:

1. Semiconductors and Integrated Circuits: These are crucial components in a wide variety of electronic devices, leading to frequent litigation over their design and function.
2. Consumer Electronics and Mobile Devices: Products such as smartphones, tablets, and other gadgets often incorporate patented technologies related to hardware, software, or user interface elements.
3. Medical Devices: Innovations in medical technology are critical and often heavily patented, making this a common area for disputes.
4. Telecommunications Technology: This includes various aspects of networking equipment and protocols, essential for the infrastructure of communication systems.
5. Computer Software and Hardware: This broad category covers operating systems, application software, and the hardware on which they run, all of which are subject to patent claims.

These technologies are regularly at the center of ITC decisions due to their economic importance and the rapid pace of innovation, which often leads to overlapping patent claims.

The recent Federal Circuit decision also provides crucial clarity for small businesses considering ITC action. Attorneys highlight that the previous uncertainty surrounding the domestic industry requirement has been significantly reduced. The court's emphasis on the importance of investment to the patent owner's business, rather than its size relative to the US market, makes ITC action a viable option for companies losing market share to infringing imports. This is particularly relevant for businesses for whom the potential gains from excluding infringing products significantly outweigh the costs of ITC litigation, a factor often overlooked by small companies.

The ruling impacts both plaintiffs and defendants in future ITC cases. For companies seeking relief, the decision lowers the bar for demonstrating the domestic industry requirement, emphasizing the relative importance of the investment to their business. Conversely, for defendants challenging the domestic industry claim, the decision limits the effectiveness of arguments based solely on the low dollar value of the investment.

The Ventria case underscores the evolving accessibility of the ITC for smaller companies facing competitive threats from foreign imports. To find out if the ITC is a useful avenue for enforcing your IP rights—including analyzing your patent claims to optimize the potential for success according to ITC precedent—contact a member of the Woods Rogers Intellectual Property team.