The Commission’s section 337 caseload has grown dramatically in recent years, and many investigations have involved products of great interest to the general public, such as cellphones, computers, and other electronic consumer devices. As a result, there has been increased attention on the Commission’s “public interest analysis” – that is, the requirement that the Commission take into account public interest factors in determining whether to issue a remedy after a finding of violation.
The Commission has, on an ongoing basis, endeavored to improve its investigatory process and ensure that its decisions are based on a well-developed factual record. Recent changes in its procedures for gathering information for the public interest analysis are one such example of these efforts. After internal deliberations and consideration of comments submitted by the public, the Commission late last year finalized new rules and procedures to help it ensure that, in appropriate investigations, it has an expanded factual record for its public interest analysis.
Under the statute, if the Commission finds a violation of section 337, it will issue an exclusion order to keep violating products out of the country (and may also issue cease and desist orders to violators), unless it finds an order should not be issued after considering the effects of a remedial order on:
- the public health and welfare;
- competitive conditions in the United States economy;
- the production of like or directly competitive articles in the United States; and
- United States consumers.
Under previous practice, the Commission solicited information on the public interest factors after the presiding Administrative Law Judge (ALJ) had issued a decision on violation and the Commission had decided whether it would review that decision. While this approach generally worked well, the Commission, while preparing its five-year strategic plan in 2009, decided to consider ways to improve the investigatory records on the public interest. The initiative was to some extent spurred by the Baseband Processors investigation (337-TA-543), in which public interest factors came to the forefront near the end of the investigation, as well as by the U.S. Trade Representative’s interest in having more information on the public interest to use in the required Presidential policy review of Commission remedial orders.
Following a successful and informative pilot program in 2010 and 2011, publication of proposed rules, and consideration of public comment on the proposed rules, the Commission issued new public interest rules, which became effective on November 18, 2011. Under the new rules, the Commission receives information regarding the potential public interest concerns before commencing an investigation, enabling it to assess whether earlier development of public interest information in the investigation would be beneficial. In such investigations, consistent with the existing rules, the Commission may then direct the ALJ to collect evidence on the public interest factors.
The new rules require that, when filing a complaint, complainants also file a separate statement of public interest providing specific information on the public interest factors the Commission must consider. The Commission then publishes in the Federal Register a notice that it has received a new complaint, and it requests comments from any member of the public or government agencies on the public interest factors. Comments are due within 8 days of the publication of the notice. All complaints, public interest comments, and other public filings are available on the Commission’s website.
Based on the responses it receives, the Commission decides whether to direct the ALJ to gather evidence on the public interest factors. If the Commission does so, the ALJ is also directed to include findings on the public interest in his recommended determination on remedy and bonding. The ALJ may only collect evidence on the public interest factors if the Commission directs him to, and that evidence must pertain to the statutory factors specified in the law. In addition, in investigations where the Commission refers the public interest issue to the ALJ, respondents are required to submit a statement on the public interest factors to the ALJ and to participate in the development of factual evidence on these factors.
In all investigations, the public has additional opportunities to comment on the public interest factors. A notice is published in the Federal Register when the ALJ’s recommended determination on remedy and bonding is issued, and the public is invited to comment on how the recommended remedy may affect the public interest. And, the rules continue the Commission’s past practice inviting the parties, government agencies, and members of the public to submit comments on the public interest after the Commission decides whether to review the ALJ’s decision on violation (unless the Commission affirms an ALJ’s decision that there is no violation).
Through these actions, the Commission is developing a more thorough and informed record on which to base its analysis of the public interest factors that it is required by law to consider in rendering its remedy decisions in section 337 investigations.