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Pilot Program Will Test Interim ALJ Initial Determinations on Key Issues in Sec. 337 Investigations

The U.S. International Trade Commission (USITC) is establishing a pilot program to allow its Administrative Law Judges (ALJs) to issue interim initial determinations (IDs) on fewer than all issues in an investigation.

This pilot program is one of a series of actions the Commission has taken to improve its section 337 investigations procedures in order to meet its statutory obligation to complete investigations expeditiously.

Section 337 investigations involve allegations of unfair practices in import trade.  The majority of complaints filed under this statute involve patent infringement allegations, but they may also allege infringement of trademarks, copyrights, mask works, and other forms of intellectual property, misappropriation of trade secrets, and other unfair acts.

Under this pilot program, the presiding ALJ in an investigation will be able to hold an evidentiary hearing and receive briefing on one or more discrete issues prior to the main evidentiary hearing, in order to fully develop the factual record to resolve those discrete issues.  Such issues may include, but are not limited to, infringement, patent invalidity, patent eligibility, standing, or satisfaction of the domestic industry requirement.  The ALJ will issue an interim ID on these discrete issues, which will then be subject to petitions for review and responses thereto and prompt Commission decisions on whether to review the interim ID and resolution of any review.

It is expected that interim ID issues will be case-dispositive, or will resolve significant issues in advance of the main evidentiary hearing, and could facilitate settlement or otherwise resolve the entire dispute between the parties.  As such, the ALJ may exercise discretion to suspend the procedural schedule, including discovery, as to remaining issues during the Commission review period.

The pilot program will operate under the following parameters:

  • Presiding ALJs will be able to put issues within the program as they deem appropriate.  It will be within each ALJ’s discretion to allow parties to file motions to put particular issues within the program that they believe will resolve the investigation expeditiously or facilitate settlement.
     
  • The presiding ALJ will fully develop the factual record and arguments on the discrete issues within the program, including, as appropriate, through an evidentiary hearing and briefing on those issues.
     
  • Interim IDs will be based on a full evidentiary record and all applicable legal standards and burdens of proof, including the requirements of the Administrative Procedure Act (APA).
     
  • Interim IDs are to be issued no later than 45 days before the scheduled start of the main evidentiary hearing in the investigation.
     
  • The presiding ALJ may determine to stay discovery on other issues during the interim ID process, taking into account the Commission’s obligation to complete investigations expeditiously and with a view toward avoiding extension of the target date.
     
  • The presiding ALJ may also determine to place the remaining procedural schedule of an investigation on hold while an interim ID is before the Commission, again taking into account the need to complete investigations expeditiously and avoiding an extension of the target date. 
     
  • Petitions for review of interim IDs will be due 8 calendar days after the interim ID issues; responses will be due 5 business days later.
     
  • The Commission will normally determine whether to review an interim ID within 45 days of issuance, and resolve any review within another 45 days, but can set a different time frame for good cause.

In the interest of more efficient and expeditious resolution of investigations, the Commission will waive any Commission rules as needed for the pilot program.

This pilot program will apply to all investigations instituted on or after May 12, 2021, and to investigations instituted prior to that date at the discretion of the presiding ALJ.

The Commission will make changes to the pilot program during its pendency as warranted, and will invite feedback from the ALJs, the Office of Unfair Import Investigations, private parties, and the bar.

After two years, the Commission will assess the pilot program’s performance, including through consideration of relevant metrics that the Commission will develop and collect, and will decide whether to permanently allow interim IDs; if so, it will promulgate rules governing the procedures for such IDs.