Section 337

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A recently introduced U.S. Senate bill demonstrates both the United States’ continued focus on foreign government-sponsored trade secret misappropriation and the International Trade Commission’s (“ITC”) potential untapped ability to swiftly protect intellectual property (“IP”) owners against this illegal conduct under Section 337.

This summer, U.S. Senators John Cornyn (R-Tex.), Christopher Coons (D-Del.), and Todd Young (R-Ind.) introduced the “Stopping and Excluding Chinese Rip-offs and Exports with United States Trade Secrets Act of 2021,” also known as the “SECRETS Act of 2021.” If passed, the bill would amend the Tariff Act of 1930 to fortify the ITC’s power to protect IP owners against trade secret misappropriation as well as work to expedite the investigatory and exclusionary processes.
Continue Reading Legislation Would Bolster ITC Power Against Foreign Government-Sponsored Trade Secret Misappropriation

On February 10, the U.S. International Trade Commission (“ITC”) issued a final determination finding South Korean lithium-ion electric vehicle battery maker SK Innovation misappropriated the trade secrets of its Korean competitor LG Chem in violation of Section 337 of the Tariff Act of 1930.  The ITC issued a 10-year exclusion order blocking SK’s imports into the U.S. of lithium-ion batteries and related products, but with substantial exceptions: SK is permitted to continue importing these products specifically for Ford Motor Co.’s EV F-150 program for four years, for Volkswagen of America’s modular electric drive line for two years, and for the repair and replacement of EV batteries for Kia vehicles sold to U.S. customers.  President Biden and his U.S. Trade Representative—Katherine Tai has been nominated but not yet confirmed—now have 60 days to review the ITC’s electric vehicle battery exclusion order, an order that could be seen as in tension with the new administration’s promotion of green energy.
Continue Reading ITC Finds Trade Secret Misappropriation and Bars Electric Vehicle Batteries from SK Innovation—With Exceptions

On January 13, the U.S. International Trade Commission (“ITC”) issued the long-awaited public version of its final opinion in the Matter of Botulinum Products (Inv. No. 337-TA-1145), otherwise known as the “Botox case.” As previewed in the ITC’s earlier notice of decision, the ITC’s final opinion affirmed the Administrative Law Judge’s issuance of a 21-month ban on imports and sale of Respondents’ lower-cost alternative to Botox for misappropriation of trade secret manufacturing processes and reversed the finding that Complainant Medytox’s specific strain of botulinum toxin bacteria is a protectable trade secret.

As we previously reported, South Korean company Daewoong Pharmaceutical and its U.S.-based licensee Evolus had been facing a potential 10-year ban of the import and sale of its product, Juveau; however, because the ITC reversed the ALJ’s finding and instead held that the bacterial strain at issue was not a protectable trade secret, the Respondents could not be liable for trade secret misappropriation of the bacterial strain itself. The ITC thus reduced the length of the ban from 10 years to 21 months, accounting for the ITC’s finding that Respondents were liable for theft of trade secrets related to Medytox’s manufacturing process.Continue Reading Final ITC Ruling in Botox Rival Case Creates More Head-Lines

On December 16, the U.S. International Trade Commission (“ITC”) affirmed in part and reversed in part Administrative Law Judge David P. Shaw’s final initial determination from July against a South Korean manufacturer of an anti-wrinkle beauty treatment made from the botulinum toxin bacteria called Jeuveau. The ITC affirmed the ALJ’s findings with respect to the manufacturing process trade secrets but overturned the ALJ’s finding that Complainants Medytox and Allergan had any protectable interest in the bacterial strain itself. As a result, the ITC rejected the ALJ’s recommendation that a 10-year ban be imposed and concluded that Respondents Daewoong and Evolus should be barred from importing Jeuveau for 21 months instead. The ITC’s decision also issued a cease and desist order to prevent Evolus from selling any products previously imported unless it posts a bond equal to $441 for each 100-unit vial of Jeuveau. A full opinion on the ITC’s decision will be available roughly two weeks from now.
Continue Reading ITC Decision Adds New Wrinkle to Ban of Botox Competitor in Trade Secret Misappropriation Case

A recent International Trade Commission (ITC) case shows that, although rarely used, the ITC remains a viable option for parties pursuing trade secret misappropriation claims. Trade secret claims can be brought under Section 337(a)(1)(A)’s catch-all for other “unfair methods of competition and unfair acts in the importation of articles”—often called “non-statutory” claims—and can result in…