The US International Trade Commission (USITC) commenced an investigation for unfair import trade practices under Rule 11 / 337, also referred to as Section 337. Investigations primarily focus on the following issues: patent infringement, trademark infringement, and any other form of unfair trade related to the imported merchandise under investigation.

Rule 11 / 337 investigations are authorized by Section 337 of the Tariff Act of 1930 and establishes the regulatory framework for investigating unfair competition and for addressing other forms of unfair trade concerning the imported articles being investigated. The law also addresses proceedings involving violations of intellectual property rights.

There are many reasons why an investigation under the Rule 11 is important in patent cases and these include the ability to streamline the litigation process and provide a good basis for making intelligent decisions about patent litigation. An effective investigation will enable patent owners to determine their likelihood of proving infringement with respect to the accused product and therefore make informed decisions regarding the overall strength of their case prior to commencing an expensive litigation.

Consequences of failing to conduct a Rule 11/337 investigation

• In case the court determines that the entire case or only some aspects of it have no value and no factual or legal support, it could dismiss the case.
• The plaintiff may have invested a large amount of time, energy, and money on a lawsuit that lacked strength before it was ever filed as a result of an insufficient or inadequate investigation.
• Insufficient investigation could result in wasted resources: i.e. legal fees, expert fees and internal company resources having to be diverted away from their use by the company for purposes of litigation.
• ITC investigations are costly. If you begin your own investigation without sufficient investigation then the complainant’s case may then get dismissed, resulting in a large cost in legal fees to the complainant.
• There are a number of serious consequences related to not conducting Rule 11/337 investigations, including possible financial penalties, wasted resources, loss of the case, and damage to the complainant's reputation.

Legal foundations of Rule 11/337 Investigation

Patents: The fundamental legal principle underlying the Rule 11/337 Investigation is a patent itself. Basically, patents confer a legal right to the inventor to prevent unauthorized use, sale, or manufacture by others of the claims in a patent for a specific time period, generally not to exceed 20 years.

Difference between Rule 11/337 investigation and other searches: The fundamental difference between a Rule 11/337 Investigation and other types of searches is that the purpose of conducting a Rule 11/337 Investigation is to fulfil the legally required obligation of conducting an adequate pre-filing investigation prior to bringing a patent infringement lawsuit, whereas, all other types of patent searches are generally proactive tools used in support of other strategic business or innovation purposes.

Rule 11/337 investigations Governance: Section 337 of the Tariff Act of 1930 is the governing body of a Rule 11/337 Investigation and provides the legal basis to address unfair competition and unfair practices in imported products including intellectual property issues.

The United States International Trade Commission (USITC), an independent quasi-judicial federal agency, has statutory authority to conduct an investigation under Section 337 and the authority to address unfair practices in the importation of goods. The level of investigation and factual support required for a Rule 11/337 Investigation should be significantly greater than for other types of litigation.

How Patent Claims are asserted: Patent claims define the boundaries of a patent's legal protection. Patent claim assertion denotes the action of a patent owner accusing another party of making, using or selling a product that infringes upon a patent. Patent claim assertion is typically handled in the context of a patent infringement lawsuit.

Importance of Rule 11/337 Investigation

• Protects unauthorised use: Rule 11/337 Investigation is important as it ensures that if a party infringes on your patented invention, it can be stopped from unauthorised use of your invention to make profits.
• Seek Damages: If any company is found to be using your patented invention, then you can file a case against that company and seek for damages.
• Efficient legal proceedings: Rule 11/337 investigation is quite important in patent litigation as it serves as a critical process for efficient legal proceedings.
• Understanding Strength of case: A thorough investigation helps the patent owners to understand the infringement potential of the accused product and helps them to accurately assess the strengths of their case before they go for expensive litigation process.
• Informed decision making: An informed decision is made by conducting a detailed pre-filing investigation. This pre-filing investigation will give the patent owner an understanding of the scope of their patent claims, how the accused product infringes those claims, and identify possible weaknesses in their own patent claims (e.g., the validity of their patent, etc.).
• Optimizing Resources: Identifying key issues and possible weaknesses will allow the legal budget (i.e. resources) to be allocated effectively. This allows the case to be built based on solid factual and legal foundation along with all of the evidence required to present a successful case.
• Enhances Likelihood of Success: A well-done investigation is likely to increase the chances of success as it sets the stage for presenting a case based on a solid foundation of fact and law and all the evidence needed to prove their case.

When and How to Conduct Rule 11/337 Investigation

The Rule 11/337 Investigation is a critical pre-litigation phase in patent disputes. The correct time to conduct the investigation is before filing any patent infringement lawsuit or complaint, and continuously throughout the litigation if any new information is found during the litigation phase.

Following steps are performed for conducting Rule 11/337 Investigation:

• Step 1- Understanding the legal framework: The first step is to understand the law, rules and procedures related to Section 337 Investigations.
• Step 2- Develop a Strategy to Assess the Case for Section 337: Determine if the case qualifies for a Section 337 Investigation. Analyze the professional conduct that is being challenged and develop a comprehensive legal strategy to achieve your goals.
• Step 3- Perform an Initial Assessment of the Case: Perform a thorough assessment to determine if the case has merit and/or strength to win, with regard to any alleged infringement.
• Step 4- Two step-analysis: The process of pre-filing infringement analysis involves two separate analyses: first, there will be a legal analysis involving claim construction and second, there will be a technical analysis comparing accused infringing product(s) with the claim or claims that have been constructed by the legal analysis.
• Step 5- Assessing Patent Validity: Before filing a patent infringement lawsuit, it would be prudent to conduct an exhaustive prior art search to determine whether the patent claims at issue can be successfully challenged based upon the validity of novelty and/or obviousness.
• Step 6- Claim construction charts: The last step is to generate claim construction charts and prepare both intrinsic and extrinsic evidence to give a proper interpretation. This includes both infringement charts which connects the claimed elements to the product features.

Tools & Resources for Rule 11/337 Investigation

• Available documentation: For a Rule 11/337 Investigation support, we analyse the accused products documentation available online through Google searches, company’s websites, videos and forums.
• Tools for Standards: For cases including use of standards like telecom or Wi-Fi, we use special tools to gain insights in the standard related documentation.
• Versatile Team: We have a versatile team of experienced workforce, consisting of Engineers, Bachelors, Masters and PhDs from various technical backgrounds, including Computer Science and Information Technology, Electronics and Communications, Electrical, Mechanical, Chemical, Biotechnology, Pharmaceuticals and Life Sciences domain.
• Databases and Official websites: We use various databases and patent offices’ official websites for information gathering related to the subject patent and its related information like prosecution history, litigation information if any.
• Technical Expertise: We have experienced professionals having knowledge about various products technologies. We have experts for source code reviews, reverse engineering and product teardowns, if required for any case.
• Legal Expertise: Many of our team members have a Law degree in addition to the technical degrees making them ideal for Intellectual Property related services like Rule 11/337 investigation support.

Handling Identified Gaps in Rule 11/337 investigation

• If there are gaps in the Rule 11/337 Investigation where there are not enough details or information, it is extremely critical to resolve those issues, as they could have serious implications for the litigation process if not resolved.
• As part of this effort, we need to prioritize and assess each of the critical gaps. These may include significant gaps where there is not enough information or analysis available to support the Patentee’s ability to establish that the asserted claim is either infringing, or that it is valid. Therefore, addressing these gaps is also extremely important.
• We develop a course of action to remedy each of the identified weaknesses, and uncover the missing information. For example, lack of detailed product specifications, unknown manufacturing methods, etc. may be obtained through a thorough investigation of the/Addressee’s product.
• In some cases, it may be necessary for us to conduct testing, reverse engineering, or teardown of the accused product to secure reliable evidence that an infringement has occurred. For software-related products, source code review may be necessary to establish that infringement has occurred.
• The Legal Team will ensure that any legislative loophole in conducting the Rule 11/337 Investigation meets the threshold necessary to avoid future liability and/or loss of client, while providing a foundation for a strong Patent Litigation Strategy.

Rule 11/337 Investigation Opinions

• Formal legal opinion: A formal legal opinion can also be called an opinion of counsel or an opinion on infringement and validity. A formal legal opinion is a written opinion from counsel, which contains a detailed analysis and conclusion on the likelihood that a patent is being infringed, and/or if a patent is valid and enforceable.
• The timing and rationale for obtaining a formal legal opinion: A formal legal opinion is an excellent piece of written proof that your investigation into the validity of your claims has been reasonable. It is also the proof that the party filing the suit believes his/her claim to be valid and has therefore obtained a formal legal opinion prior to filing for an ITC investigation or litigation.
• Legal opinion Structure: A legal opinion is laid out in a formal fashion that has specific and organized documentation. The legal opinion looks at the entire body of law including both factual evidence associated with an invention and prior art, including patent claims, the applicable law, and the law pertaining to validity.

Elements of a legal opinion are as follows:

• Claim Construction Analysis – This is the section that interprets the meaning of the terms and/or limitations in the patent claims based upon the patent's specifications, drawings and prosecution history.
• Infringement Analysis and Claim Charts – Each claim is analyzed to determine if the accused infringer has infringed on the patent, and the claim is compared to the accused product on a limitation by limitation basis.
• Validity Section – Certain claim limitations may have validity issues relating to prior art, etc., and are included in the legal opinion as a separate section to address these issues but would be included as part of the infringement analysis.

Valuation in Litigation: A formal opinion on the validity of the claims of a patent has a significant value to both a patent owner and an alleged infringer in patent litigation because it can serve as an important strategic and defensive resource, demonstrating that there has been due diligence exercised, mitigating risk, and potentially materially influencing the result of a lawsuit.

A patent validity opinion may be helpful in evaluating the strength of a case, and determining which particular patent(s) and claim(s) a party should assert, focusing its resources on those assertions with the greatest likelihood of success according to the law and the facts. A patent validity opinion may also assist with the selection of appropriate products and parties to pursue, as well as the negotiation of a resolution.

Industry/Technology Specific Considerations

Software related: For software related cases, source code reviewing is a foundational component. It can reveal potential infringements that may be hidden within lines of code.

There are certain tools that can be used by the source code experts to analyze the code like WinGrep/PowerGREP, Microsoft Visual Studio, Notepad ++ etc. Source code review is a useful tool when it comes to ascertaining software related infringement.

 

Standards related: There might be certain cases where the patents are related to specific standards like telecom patents, Wi-Fi patents, Bluetooth, etc. In such cases, the target product complaint standard can be assessed and the standard related documentation can be analysed from their official providers. Further, we also have some in-house tools that we use when performing standards related infringement analysis.

Semiconductor/Fabrication related: For semiconductor or fabrication level patents, there is a different approach that is followed for these cases. In such cases, the target products might have very limited evidences to show infringement or potential use of the invention as fabrication details are merely disclosed by the companies. In such scenario, apart from the available product documentation, we also consider the research papers or educational documentation of the target product/company in order to map the evidences or show the intent of use of the patented technology by the product.

Cases requiring reverse engineering/teardowns: There might be some case in which the reverse engineering or teardown of the target product is required to ascertain the infringement or to gather necessary evidences for specific claim elements. For such cases, we have our experts’ team that are specialized in reverse engineering or teardown of various products.

Real-World Case Studies

Case 1:

The case involved an innovative client (ABC Corp) involved in self-driving vehicle development who was accused of infringing another company’s patent on components used by ABC's self-driving vehicles and contacted us to provide full Rule 11/337 investigation support. Our task was to assist in defending against this patent infringement allegation and to establish that ABC has not infringed on any of the claims in the patent at issue. We engaged in an extensive investigation into the facts and collected relevant documentary evidence in order to build a strong case in support of ABC's position. Because we were well-versed in the technical details of ABC's self-driving vehicles and the facts surrounding the patent infringement allegations, we were able to work with our team of qualified patent attorneys and technical analysts to conduct an in-depth analysis of both the asserted patent(s) and the accused vehicle components. We created detailed claim charts estimating the validity of the asserted patent(s) as well as conducting extensive prior art searches, which helped inform the strategic defense strategy we jointly developed with ABC. ABC also expressed its appreciation for the quality of work product we delivered.

Case 2:

A US law firm had contacted us for an investigation for rule 11/337, we provided them with support. Our investigations included pre-filing investigations prior to the filing of a patent infringement lawsuit, including Rule 11 investigations as well as ITC 337 investigations. We helped with reasonable infringement analyses prior to the filing of the patent infringement lawsuit, and we prepared claim charts containing specifically detailed and clear evidence to support your claim interpretation. We conducted an extensive search on the accused product and gathered all relevant documents to support the generation of claim charts with strong supporting evidence in the claim charts. In developing the final claim charts, we mapped the claimed elements of the patent to product features, provided the applicable specification support, and made comments related to our analysis. The claim charts we prepared were well-received by our client and were used as evidence in the client's later legal proceedings.

Common Misconceptions

• ‘I can file the case now and figure out the details later’: It is a common misbelief to file the case first and investigate the detail later. A reasonable inquiry must be undertaken before the case or complaint is filed. Courts have repeatedly sanctioned parties who file a complaint as a fishing expedition to uncover evidence of infringement. Hence, a full-fledged analysis is necessary before filing the case.
• ‘A simple visual inspection of the accused product is enough’: For most infringement cases, especially those having complex technology, a mere visual inspection is insufficient. Courts have emphasized that a thorough investigation often requires a more detailed technical analysis, which may include reviewing detailed product specifications, manuals, reverse engineering or product testing.
• ‘The investigation is only about infringement’: For the plaintiff, the investigation also extends to the validity and enforceability of their own patent. They must have a reasonable belief that the patent claims they are asserting are valid. Filing a lawsuit based on a patent that is clearly invalid can also lead to sanctions.
• ‘The investigation is only for the initial complaint, not for later stages’: One of the most common misconceptions is that the investigation is important for initial complaint only, however, the investigation builds a strong foundation for further litigation proceedings and it’s a continuous process and go hand-in-hand as the litigation proceeds.
• 'Competitor advertisements are enough proof for my claims, I don't need a further analysis of them': Advertisements provide some good generalities, however, they will usually not provide all the important information you need. Critical details concerning complex products may not be made available from them and require a thorough investigation to provide evidence to support all the elements to establish your case.

How can Effectual help – our expertise domain wise in dealing Rule 11/337 investigation

• We have a team of experienced workforce, consisting of Engineers, Bachelors, Masters and PhDs from various technical backgrounds, including Computer Science and Information Technology, Electronics and Communications, Electrical, Mechanical, Chemical, Biotechnology, Pharmaceuticals and Life Sciences domain.
• Many of our team members have a Law degree in addition to the technical degrees making them an ideal fit for Intellectual Property related services like Rule 11/337 investigation.
• We have various experts to provide support in reasonable infringement analysis prior to filing the lawsuit.
• Our techno-legal professionals are quite experienced when it comes to correlating the marketing language of the products with technical terminologies, to efficiently relate the product feature/functionality with the patent claim elements.
• We have experienced team members in different domains be it software domain, fabrication, standards related, telecom or Wi-Fi, artificial intelligence/machine learning, etc.
• We have various team members who are quite experienced in product testing, teardown, reverse engineering or even source code reviewing.

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