• HQ H259071
• Dec 10, 2014

• Type : 19 U.S.C. §1337; Unfair Competition • HTSUS :
•  Related:   H258492; H067500; H257012   

OT:RR:BSTC:IPR H259071 AEB

Ms. Rachael Lamkin
Otter Products LLC
209 South Meldrum Street
Fort Collins, CO 80521

Mr. Garret A. Leach
Kirkland & Ellis LLP
300 North LaSalle
Chicago, IL 60654

RE: Reconsideration of CBP Ruling Letter HQ H258492; U.S. International Trade Commission; General Exclusion Order; Investigation No. 337-TA-861/867; Certain Cases for Portable Electronic Devices

Dear Ms. Lamkin and Mr. Leach,

This is in response to your request for reconsideration, made on behalf of Otter Products LLC (“OtterBox”), of Headquarters Ruling Letter (“HQ”) H258492, issued by U.S. Customs and Border Protection (“CBP”) on November 4, 2014, which determined that certain electronic device cases manufactured and imported by OtterBox identified as the “Symmetry” series are subject to the general exclusion order issued by the U.S. International Trade Commission in the above-referenced investigation. In reaching our decision on the request for reconsideration, we have taken into consideration your submission, dated November 10, 2014, as well as three supplemental submissions, dated November 14, 2014, November 30, 2014, and December 4, 2014, the publicly available documents related to the U.S. District Court for the Northern District of California case Speculative Product Design, LLC v. Otter Products, LLC, No. 5:14-CV-03749-EJD (N.D. Cal. filed Aug. 18, 2014), the publicly available documents related to Otter Products, LLC v. United States International Trade Commission, Court No. 14-1840 (Fed. Cir., filed Sep. 16, 2014), filed with the U.S. Court of Appeals for the Federal Circuit (“CAFC”), and all documents previously considered in reaching the determinations of HQ H258492.

FACTS:

The United States International Trade Commission (“ITC”) instituted investigation 337-TA-861 on November 16, 2012, based on a complaint filed by Speculative Product Design, LLC (“Speck”) on September 26, 2012. See 77 Fed. Reg. 68828 (Nov. 16, 2012). Speck alleged violations of section 337 of the Tariff Act of 1930 (19 U.S.C. §1337) by reason of infringement of various claims of U.S. Patent No. 8,204,561 (“the ‘561 patent”). The ITC instituted investigation 337-TA-867 on January 31, 2013, based on a complaint filed by Speck on December 26, 2012. See 78 Fed. Reg. 6834 (Jan. 31, 2013). The complaint also alleged violations of section 337 of the Tariff Act of 1930 (19 U.S.C. §1337) by reason of infringement of various claims of the ‘561 patent. The investigations were consolidated on January 31, 2013. Id. Neither investigation accused OtterBox.

On July 8, 2013, the Administrative Law Judge (“ALJ”) issued his order construing terms of the ‘561 patent. See USITC Inv. No. 337-TA-861/867, “Order No. 13: Construing the Terms of the Asserted Patent,” USITC Doc. ID No. 512805. On February 21, 2014, the ALJ issued his final initial determination (“ID”), finding that the asserted patent was infringed by the accused portable electronic device cases. See USITC Inv. No. 337-TA-861/867, “Initial Determination,” USITC Doc. ID No. 529230 at 35. On April 8, 2014, the ITC determined not to review the ID. See 79 Fed. Reg. 20228-30 (April 11, 2014). On June 20, 2014 the ITC issued the GEO, directing that “cases for portable electronic devices covered by one or more of claims 4, 5, 9, and 11 of the ‘561 patent are excluded from entry into the United States for consumption, for the remaining term of the patent, except under license of the patent owner or as provided by law.”

On September 2, 2014, OtterBox submitted a request for internal advice (“IA”) pursuant to 19 C.F.R. Part 177, CBP Regulations, regarding whether OtterBox’s Symmetry phone cases were inside the scope of the GEO and therefore subject to exclusion from entry for consumption into the United States. Subsequently, on September 4, 2014, OtterBox filed at the ITC a request for an advisory opinion pursuant to 19 C.F.R. §210.79, that the Symmetry phone cases were outside the scope of the GEO. See 79 Fed. Reg. 68299 (November 14, 2014). On September 16, 2014, OtterBox – not being accused at the ITC – appealed the ITC’s GEO to the CAFC, pursuant to 19 U.S.C. §1337(c). Otter Products, LLC v. United States International Trade Commission, Court No. 14-1840 (Fed. Cir., filed Sep. 16, 2014). To bolster the position of the IA request to CBP, OtterBox provided two supplemental petitions on September 22, 2014. On September 24, 2014, OtterBox filed a Motion to Stay Enforcement of the GEO as to OtterBox’s products at the CAFC, asserting that all four factors required for the granting of a stay were met. Id. at Doc. 5-1. On September 26, 2014, CBP determined not to issue a ruling on OtterBox’s IA request.

On October 1, 2014, both the ITC and Speck filed in opposition to OtterBox’s motion to stay enforcement. Id. at Doc. 18, 19-1. Separately, on October 1, 2014 Speck also filed in opposition to OtterBox’s request for an advisory opinion at the ITC. See 79 Fed. Reg. 68299. OtterBox replied to Speck’s and the ITC’s opposition motions on October 6, 2014. Otter Products, LLC v. United States International Trade Commission at Doc. 21-1. On October 20, 2014, the CAFC denied OtterBox’s Motion to Stay, concluding that OtterBox had failed to carry its burden in seeking a stay. Id. at Doc. 25. Also on October 20, 2014, Speck filed its request for a ruling pursuant to 19 CFR Part 177 as to whether the Symmetry cases fell under the scope of the GEO. On October 22, 2014, the ITC determined to institute an advisory opinion to determine whether OtterBox’s Symmetry phone cases infringed the ‘561 claims at issue. See 79 Fed. Reg. 68299. On October 24, 2014, OtterBox filed a motion to withdraw its request for an advisory opinion. See 79 Fed. Reg. 64214–15 (October 28, 2014).

On November 4, 2014, CBP issued HQ H258492 holding that the Symmetry cases did fall under the scope of the GEO. OtterBox then filed another motion to stay enforcement of the GEO on November 7, 2014. Otter Products, LLC v. United States International Trade Commission at Doc. 33-1. Also on November 7, 2014, the ITC granted OtterBox’s motion to withdraw its advisory opinion request. See 79 Fed. Reg. 68299 (November 14, 2014). The CAFC again denied OtterBox’s motion for a stay on November 10, 2014. Id. at Doc. 34.

In HQ H258492, CBP held that 19 C.F.R. §177.7(b) does not preclude it from ruling on the instant OtterBox “Symmetry” electronic device cases because the issue of whether these products infringe U.S. Patent No. 8,204,561, issued on June 19, 2012 (“the ‘561 patent”), and owned by Speck is not before the CAFC in the matter of Otter Products, LLC v. United States International Trade Commission, Court No. 14-1840.

With regard to claim construction, HQ H258492 held that the “bottom surface” term in claim 1 of the ‘561 patent is the surface parallel to the elastomeric overhang 21 as depicted in Figs. 2b and 5 of the ‘561 patent. The elastomeric overhang 21 extends from the top of three side surfaces, as depicted in Fig. 5 of the ‘561 patent. Support for this construction was found in claim 7 of the ‘561 patent, and within the specification of the ‘561 patent at Figures 2b, 3, and 5, and at col. 2, lines 54-59. Additionally, CBP held that the claim term “co-molded … and permanently affixed” does not limit claim 1 of the ‘561 patent to any specific processes. And finally, the claim term “cut away portion” in claim 1 of the ‘561 patent should not be read with the additional limitation “located at the corner joint.”

Finally, HQ H258492 held that the OtterBox Symmetry cases at issue (specifically, Part Nos. 11-37555-4W, 11-30188-J1, 11-37561-5B, 16-46190-J1, 16-46190-6N, and 16-46190-9U) are covered by claims 5, 9, and 11 of the ‘561 patent. Therefore, the accused products are within the scope of the ITC’s general exclusion order in Investigation No. 337-TA-861/867, and are subject to exclusion from entry into the United States. The cases at issue in HQ H258492 are pictured below:



 Top, Bottom, and Side views OtterBox Symmetry Case for iPhone 5/5s (Part Nos. 11-37555-4W, 11-30188-J1, and 11-37561-5B) Top, Bottom, and Side views OtterBox Symmetry Case for iPhone 6 (Part Nos. 16-46190-J1, 16-46190-6N, and 16-46190-9U)   Your request for reconsideration raised issues concerning the validity, claim construction, and “read on” of the ‘561 patent, as well as whether 19 C.F.R. §177.7(b) precludes CBP from issuing a ruling pursuant to 19 CFR Part 177 in light of Otter Products v. United States International Trade Commission, Court No. 14-1840.

ISSUES:

I. Whether CBP is precluded by 19 C.F.R. §177.7(b) from issuing a ruling on the accused OtterBox “Symmetry” electronic device cases.

II. Whether OtterBox may challenge the ‘561 patent before CBP.

III. The proper claim construction of the term “substantially cover an exterior of the bottom and side surfaces of the flexible inner layer”, found in claim 1 of the ‘561 patent.

IV. Whether the OtterBox “Symmetry” electronic device cases (specifically, Part Nos. 11-37555-4W, 11-30188-J1, 11-37561-5B, 16-46190-J1, 16-46190-6N, and 16-46190-9U, taken from Entry XXX-XXXX640-3), are covered by the asserted claims of the ‘561 patent and therefore fall within the scope of the ITC’s General Exclusion Order in Investigation No. 337-TA-861/867, such that they would be excluded from entry for consumption into the United States.

LAW AND ANALYSIS:

Patent infringement determinations for utility patents entail two steps. The first step is to interpret the meaning and scope of the patent claims asserted to be infringed. The second step is to compare the properly construed claims to the accused device. See Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995) (en banc), aff’d, 517 U.S. 370 (1996). The first step is a question of law; the second step is a question of fact. See Freedman Seating Co. v. American Seating Company, 420 F.3d 1350, 1357 (Fed. Cir. 2005).

In patent law, there are two types of infringement: direct and indirect infringement. Direct infringement includes two varieties: literal infringement and infringement under the doctrine of equivalents.

Literal infringement is when every limitation recited in a claim is found in the accused device. See Strattec Security Corp. v. General Automotive Specialty Co., 126 F.3d 1411, 1418 (Fed. Cir. 1997); see also Digital Biometrics, Inc. v. Identix, Inc., 149 F.3d 1335, 1349 (Fed. Circ. 1998) (“An accused device cannot infringe, as a matter of law, if even a single limitation is not satisfied.”). Additionally, a dependent claim cannot be found to infringe if the independent claim from which it depends is not found to infringe. See Becton Dickinson & Co. v. C.R. Bard Inc., 922 F.2d 792, 798 (Fed. Cir. 1990) (“The holding of noninfringement of claim 1 applies as well to all claims dependent on claim 1.”).

As for the scope of protection provided, it is a “bedrock principle” of patent law that “the claims of a patent define the invention to which the patentee is entitled the right to exclude.” Innova/Pure Water, Inc. v. Safari Water Filtration Systems, Inc., 381 F.3d 1111, 1115 (Fed. Cir. 2004); Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996) (“[W]e look to the words of the claims themselves…to define the scope of the patented invention.”).

Furthermore, the CAFC has made clear that claim terms are given their ordinary and customary meaning, which refers specifically to the ordinary and customary meaning that the claim term would have to a person of ordinary skill in the art at the time of the invention. See Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005) (en banc). The inquiry into how a person of ordinary skill in the art understands a claim term provides an objective baseline from which to begin claim interpretation. See Innova, 381 F.3d at 1116. That starting point is based on the well-settled understanding that inventors are typically persons skilled in the field of the invention and that patents are addressed to and intended to be read by others of skill in the pertinent art. See Verve, LLC v. Crane Cams, Inc., 311 F.3d 1116, 1119 (Fed. Cir. 2002).

The person of ordinary skill in the art is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification. See Phillips, 415 F.3d at 1313. Often, this requires an examination of terms that have a particular meaning in a field of art. Id. Since the meaning of a claim term, as understood by persons of skill in the art, is often not immediately apparent, and since patentees frequently act as their own lexicographers, a court or administrative body responsible for making patent infringement determinations should look to sources available to the public that show what a person of skill in the art would have understood a disputed claim term to mean. Id. These sources include, for example, the words of the claims themselves, the remainder of the specification and the prosecution history, along with certain extrinsic evidence in appropriate circumstances. Id.

Importantly, as stated by the CAFC in Vitronics and reaffirmed in Phillips, claims must be read in light of the specification, of which they are a part, since the specification “is always highly relevant to the claim construction analysis. Usually, it is dispositive; it is the single best guide to the meaning of a disputed term.” Phillips, 415 F.3d at 1315 (citing Vitronics, 90 F.3d at 1582); see also Standard Oil Co. v. Am. Cyanamid Co., 774 F.2d 448, 452 (Fed. Cir. 1985) (“The specification is, thus, the primary basis for construing the claims.”).

While continuing to be mindful of this fine line between interpretation and importation, Phillips explains that:

[T]he line between construing terms and importing limitations can be discerned with reasonable certainty and predictability if the court’s focus remains on understanding how a person of ordinary skill in the art would understand the claim terms. For instance, although the specification often describes very specific embodiments of the invention, we have repeatedly warned against confining the claims to those embodiments.…In particular, we have expressly rejected the contention that if a patent describes only a single embodiment, the claims of the patent must be construed as being limited to that embodiment….That is not just because section 112 of the Patent Act requires that the claims themselves set forth the limits of the patent grant, but also because persons of ordinary skill in the art rarely would confine their definitions of terms to the exact representations depicted in the embodiments.

Phillips, 415 F.3d at 1323 (internal citations omitted). Accordingly, the CAFC has provided the framework above for interpreting patent claims and reading those claims, as properly construed in light of the relevant evidence, onto an accused device.

Pursuant to the Tariff Act of 1930, the ITC has authority to conduct investigations into imported articles that allegedly infringe United States patents and impose remedies if the accused products are found to be infringing. See 19 U.S.C. §1337(a)(1)(B), (b)(1), (d), (f). Specifically, 19 U.S.C. §1337(d) provides the Commission authority to direct the exclusion from entry of articles found to be infringing. Moreover, when the Commission determines that there has been a violation of section 337, it may issue two types of exclusion orders: a limited exclusion order and/or a general exclusion order. See Fuji Photo Film Co., Ltd. v. U.S. Int’l Trade Comm’n, 474 F.3d 1281, 1286 (Fed. Cir. 2007); see also Certain Ink Cartridges and Components Thereof, Inv. No. 337-TA-565, Commission Opinion (October 19, 2007).

Both types of orders direct CBP to bar the infringing products from entering the country. See Yingbin-Nature (Guangdong) Wood Indus. Co. v. U.S. Int’l Trade Comm’n, 535 F.3d 1322, 1330 (Fed Cir. 2008). A limited exclusion order is “limited in that it only applies to the specific parties before the Commission in the investigation”. Id. In contrast, a general exclusion order bars importation of the infringing products by everyone, regardless of whether they were respondents in the Commission’s investigation. Id. A general exclusion order is appropriate if two exceptional circumstances apply. See Kyocera Wireless Corp. v. U.S. Int’l Trade Comm’n, 545 F.3d 1340, 1356 (Fed. Cir. 2008). A general exclusion order may only be issued if (1) “necessary to prevent circumvention of a limited exclusion order,” or (2) “there is a pattern of violation of this section and it is difficult to identify the source of infringing products.” 19 U.S.C. §1337(d)(2); see also Kyocera, 545 F.3d at 1356 (“If a complainant wishes to obtain an exclusion order operative against articles of non-respondents, it must seek a GEO by satisfying the heightened burdens of §§1337(d)(2)(A) and (B).”). Additionally, a seizure and forfeiture order issued under 19 U.S.C. §1337(i) directs CBP to seize and forfeit articles imported in violation of an exclusion order when the importer previously had articles denied entry and received notice that seizure and forfeiture would result from any future attempt to import covered articles.

The issuance of a general exclusion order by the ITC binds named parties and non-named parties alike and shifts to would-be importers, “as a condition of entry, the burden of establishing noninfringement.” Hyundai Electronics Industries Co. v. U.S. Int’l Trade Comm’n, 899 F.2d 1204, 1210 (Fed. Cir. 1990). Accordingly, the burden is on OtterBox to establish that the products at issue are not covered by one or more of claims 4, 5, 9, or 11 of the ‘561 patent.

CBP, within the confines of its role as set forth above, issues administrative rulings pursuant to 19 C.F.R. Part 177 that address the admissibility of articles in light of ITC exclusion orders.  This part of the regulations, as a general matter, covers the issuance of rulings to importers and other interested parties.  The various sections therein describe the situations in which a ruling may be requested, the procedures to be followed in requesting a ruling, the conditions under which a ruling will be issued, the effect of a ruling when it is issued, and the publication of a ruling after its issuance.  See 19 C.F.R. Part 177.   

A ruling letter issued under the provisions of this part represents the official position of CBP with respect to the particular transaction or issue described therein and is binding on all CBP officials until modified or revoked.  See 19 C.F.R. §177.9(a).  The authority for CBP to modify or revoke a ruling stems from 19 U.S.C. §1625, as promulgated in 19 C.F.R. §177.12, which establishes the procedures CBP must apply to take such an action.  See International Custom Products, Inc. v. United States, 549 F. Supp. 2d 1384, 1395 (Ct. Int’l Trade, 2008) (noting the extensive modifications by Congress to 19 U.S.C. §1625 in 1993 through the Customs Modernization Act). 

            CBP does not require a compelling reason to revoke a prior ruling, even if there has been reliance on the ruling in question.  Instead, the standard for CBP modification or revocation requires establishment that the prior ruling was issued in error or that it is not in accord with the current views of the agency.  See 19 C.F.R. §177.12(a); See also International Custom Products, 549 F. Supp. 2d at 1394-95.  With this framework provided, the decision now turns to the question of whether OtterBox has established that HQ H258492 was issued in error. 

I. Whether CBP is Precluded by 19 C.F.R. §177.7(b) from Issuing a Ruling

OtterBox argues that HQ H258492, and what it identifies as the associated redelivery notices, were issued in error due to 19 C.F.R. §177.7(b), which states that “[n]o ruling letter will be issued with respect to any issue which is pending before the United States Court of International Trade, the United States Court of Appeals for the Federal Circuit, or any court of appeal therefrom.” OtterBox contends that, given its notice of appeal, the matter is before the Federal Circuit and CBP was precluded from issuing its ruling.

As an initial point, care must be taken to prevent blurring the line between an appeal arising generally from an administrative matter (such as an appeal resulting from a particular investigation at the Commission) and the specific issue, as that term is used and understood in section 177.7(b), that is presented to the court for a decision. In fact, CBP has issued ruling letters during the pendency of appeals at the Federal Circuit that involve a final determination of the Commission because, although the general matter was on appeal, the particular issue before the Federal Circuit was not the subject of the administrative ruling. See HQ H067500 (dated August 5, 2009). Moreover, CBP is required in the section 337 context to make determinations in the form of interpretive rulings and protest review decisions, specifically where certain products or persons were not before the Commission, during the pendency of an appeal at the Federal Circuit because exclusion orders issued under 19 U.S.C. §1337(d) are effective at the time of issuance and, consequentially, CBP must decide whether an imported article is to be refused entry. See 19 U.S.C. §1337(j) (“Subject to the provisions of paragraph (2), such determination shall, except for purposes of subsection (c) of this section, be effective upon publication thereof in the Federal Register, and the action taken under subsection (d), (e), (f), (g), or (i) of this section, with respect thereto shall be effective as provided in such subsections.”). Accordingly, redelivery notices may be sent for articles subject to an exclusion order irrespective of whether an appeal is pending and CBP is precluded from issuing an administrative ruling under 19 C.F.R. §177.7(b) only when the specific issue at the court is the subject of the ruling request.

OtterBox further contends that infringement of the ‘561 patent by the Symmetry cases and whether these products are subject to the exclusion order is the issue pending before the Federal Circuit and that CBP was originally correct in its now revoked internal advice decision, HQ H257012 (dated September 26, 2014). However, a review at this time of the filings at the Federal Circuit along with an examination of the statutory interplay and relevant precedent does not establish that the court will adjudicate the infringement issue during the appeal or whether OtterBox even has standing to raise this issue or bring the appeal.

As noted in HQ H258492, it is unclear from the filings what issues the Federal Circuit will adjudicate, particularly when OtterBox has admitted that resolution of the appeal does not require the court to determine whether or not the Symmetry cases infringe the ‘561 patent. See HQ H258492 at 7; see also OtterBox Reply to Opposition to Motion for Stay of the GEO, filed October 6, 2014, page 7, FN 5. On this basis alone it is difficult for CBP to find that infringement is without question pending before the Federal Circuit when the case may be resolved without a decision on the merits. Additionally, the Federal Circuit has reaffirmed in the section 337 context the “basic rule that issues not decided by the Commission cannot be presented to the court.” Beloit Corp. v. Valmet Oy, 742 F.2d 1421, 1423 (Fed. Cir. 1984). The Federal Circuit “does not sit to review what the Commission has not decided” and instead remands the matter to the Commission for a determination in the first instance. VastFame Camera Ltd. v. U.S. Int’l Trade Comm’n, 386 F.3d 1108, 1116 (Fed. Cir. 2004), citing Beloit Corp. at 1423. While this doctrine further clouds the question of what issues will be presented and decided on appeal when the Commission has not as yet made any determination with regard to the Symmetry cases, it also suggests that should the Federal Circuit remand the matter to the Commission for some determination in the first instance, absent a stay from the court or the Commission, CBP will likely find itself in the same position as with many other general exclusions where it, as the agency responsible for administering the remedy, must determine whether an article is subject to exclusion from entry without regard to whether a related proceeding is ongoing at the Commission. For the above reasons, CBP cannot conclusively say that the issue in question is pending before the Federal Circuit.

Moreover, it is not entirely clear that OtterBox has standing to appeal the Commission’s determination under 19 U.S.C. §1337(c) or what aspect of the determination it can challenge—especially since the Commission has made no finding regarding its products—should it have standing. As the Supreme Court reiterated last term, “[f]rom Article III’s limitation of the judicial power to resolving ‘Cases’ and ‘Controversies,’ and the separation of powers principles underlying that limitation, we have deduced a set of requirements that together make up the ‘irreducible constitutional minimum of standing.’ Lujan v. Defenders of Wildlife, 504 U. S. 555, 560 (1992). The plaintiff must have suffered or be imminently threatened with a concrete and particularized ‘injury in fact’ that is fairly traceable to the challenged action of the defendant and likely to be redressed by a favorable judicial decision.” Lexmark Int'l, Inc. v. Static Control Components, Inc., 134 S. Ct. 1377; 188 L. Ed. 2d 392; 2014 U.S. LEXIS 2214 (2014).

The constitutional requirement for standing applies on appeal as it does before trial courts and with equal force to challenges of administrative agency determinations. Consumer Watchdog v. Wis. Alumni Research Found., 753 F.3d 1258, 1261 (Fed. Cir. 2014). Although Article III standing is not necessarily a requirement to appear before an administrative agency, when a party seeks review of an agency’s determination in a federal court, “the constitutional requirement that it have standing kicks in.” Id., citing Sierra Club v. E.P.A., 292 F.3d 895, 899 (D.C. Cir. 2002). “Where Congress has accorded a procedural right to a litigant, such as the right to appeal an administrative decision, certain requirements of standing—namely immediacy and redressability, as well as prudential aspects that are not part of Article III—may be relaxed. See Massachusetts v. E.P.A., 549 U.S. 497, 517–18 (2007). However, the ‘requirement of injury in fact is a hard floor of Article III jurisdiction that cannot be removed by statute.’” Id., citing Summers v. Earth Island Inst., 555 U.S. 488, 492-93 (2009) (emphasis added).

Here, as in Consumer Watchdog, it is not enough that the statutory framework allows a third party to appeal because a statutory grant of a procedural right, such as the right to appeal, does not eliminate the requirements of Article III. Id. at 1262; see also Lexmark Int’l, Inc. at 1386. In this context, OtterBox’s standing to appeal and the scope of that challenge is in question because, among other reasons, its injury in fact is directly related to the CBP determination that the Symmetry cases are covered by the patent claims and subject to the general exclusion order, not because of Commission determination.

Additionally, OtterBox’s interpretation of 19 U.S.C. §1337(c) in the context of a general exclusion order where the Commission has made no finding regarding the products of a non-party suggests that whether one qualifies as a “person adversely affected” turns on CBP’s determination that the articles in question are subject to the exclusion order. However, the Federal Circuit has indicated that the “court’s jurisdiction cannot be made to turn upon such manipulatable criteria.” Allied Corp. v. U.S. Int'l Trade Com., 850 F.2d 1573, 1578 (Fed. Cir. 1988). This is made all the more so given that a CBP determination, of course, is not immediately appealable to the Federal Circuit and that OtterBox has a remedy under 19 U.S.C. §§1514 and 1515 to file a protest and challenge any denial of the same at the U.S. Court of International Trade.

Lastly, OtterBox has not identified any case to support its claim that the infringement issue is pending with the court because it will have standing to appeal and present this specific issue. Although not cited in the administrative record, CBP has found a related but distinguishable Federal Circuit case interpreting the term “person adversely affected” contained in 19 U.S.C. § 1337(c). See LSI Computer Systems, Inc. v. U.S. Int'l Trade Com., 832 F.2d 588 (Fed. Cir. 1987). In that case, both the Commission and the intervening complainant urged the Federal Circuit to recognize a general rule that one who is not a party before an administrative proceeding is not entitled to appeal. Id. at 589. However, the court found that argument missed the point and that the statute governed who may seek judicial review of an ITC final determination. Id. LSI, a component manufacturer who sold products to foreign manufacturers for incorporation into downstream products that were eventually imported into the United States and were the concerned articles whose infringement resulted in exclusion from entry, conceded that it was not a "party" to the administrative proceeding before the ITC, but asserted standing to appeal on the basis that it was a "person" adversely affected by the Commission's final determination, within the statutory meaning of 19 U.S.C. §1337(c). Id. The Federal Circuit noted that section 337 is a reenactment of Section 316 of the Tariff Act of 1922, which provided for appeal from the Commission's determinations, but limited such to importers and consignees who were accused of unfair practices, excluding complainants. Id. Section 337 initially embodied that same limitation on standing to appeal prior to its amendment in 1974 but with the Trade Act of 1974, section 337(c) was amended to grant standing to appeal to any person adversely affected by a final determination of the Commission. Id.

After examining the legislative history surrounding the Trade Act of 1974, the Federal Circuit found that it was clear that Congress at least intended to give complainants standing to appeal and that this is not a showing “that Congress did not also contemplate giving standing to appeal to non-parties who are adversely affected by the Commission's final determination as plainly provided by statute -- at least where, as here, the appellant's product is included in the products excluded by the Exclusion Order.” Id. at 590 (emphasis added).

However, unlike the posture of OtterBox’s appeal, LSI was adversely affected as a direct result of a finding of infringement by the Commission that its products were excluded from entry by a determination of the Commission and not by a decision of CBP. OtterBox’s products, on the other hand, have not been the subject of a Commission determination and instead have been directly affected by a CBP determination that its Symmetry cases are covered by the relevant patent claims and therefore subject to exclusion from entry. Again, under this theory, a person’s standing to appeal its non-adjudicated products under §1337(c) would turn on CBP’s determination to exclude those articles, which, as stated above, is not directly appealable to the Federal Circuit but only may reach that court through the protest mechanism and the CIT.

For the reasons above, including, but without taking a position on the ultimate merits, the uncertainty regarding the nature of OtterBox’s standing to appeal, the determination here is that OtterBox has not established that HQ H258492 was issued in error based on its argument that the issue addressed in the ruling is pending before the Federal Circuit.

II. Whether OtterBox may challenge the ‘561 patent before CBP

In addition to the non-infringement arguments addressed below, OtterBox argues that, under 19 U.S.C. §1337(c), it is entitled to raise all legal and equitable defenses before CBP and, therefore, that CBP is authorized to adjudicate OtterBox’s challenge to the validity of the patent claims in question. However, CBP possesses no such power and is not authorized to determine whether a patent is invalid. As discussed in more detail below, nothing in the relevant statutory framework or precedent interpreting these provisions holds—or even suggests—otherwise.

An administrative agency, such as the Commission or CBP, is entirely the creature of statute. Sealed Air Corp. v. U. S. International Trade Com., 645 F.2d 976, 978 (C.C.P.A. 1981). Thus, an agency must find authority for its actions in its enabling statute. VastFame Camera Ltd. v. U.S. Int’l Trade Comm’n, 386 F.3d 1108, 1112 (Fed. Cir. 2004). As stated in Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 837, 842, (1984), in connection with an agency's construction of the statute it administers, "[i]f the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress." The determination here is that Congress clearly intended to grant the Commission, and not CBP, the power to adjudicate a patent’s validity and CBP must give effect to that unambiguous intent and that to do otherwise would exceed the authority Congress has granted.

Originally, the Commission did not possess authority to address a challenge to a patent’s validity. Frischer & Co. v. United States, 39 F.2d 247, 254 (C.C.P.A. 1930). The substance of section 337 originated in the Tariff Act of 1922, ch. 356, Title III, § 316, 42 Stat. 943 (1922), where section 316 was the predecessor to section 337. Lannom Mfg. Co. v. United States International Trade Com., 799 F.2d 1572, 1578 (Fed. Cir. 1986). At the time in question, the then-United States Tariff Commission was considered merely an administrative fact-finding body with no judicial powers. Id. at 1577. Accordingly, absent statutory authorization otherwise, “[t]he right to pass upon the validity of a patent which has been issued by the Patent Office is a right possessed only by the courts of the United States given jurisdiction thereof by law.” Id., citing Frischer & Co. at 258.

Section 316 was reenacted as section 337 of the Tariff Act of 1930, ch. 497, Title III, § 337, 46 Stat. 703 (1930). Although other amendments to the statute were made at that time, the Commission was not granted the authority to review patent validity. Lannom Mfg. Co. at 1577. This understanding of the Commission’s lack of authority to address invalidity challenges continued undisturbed. In In re Von Clemm, 43 C.C.P.A. 56, 229 F.2d 441, 444, 108 U.S.P.Q. (BNA) 371, 373 (CCPA 1955), the CCPA reiterated that “the validity of the patent or patents involved may not be questioned by the Tariff Commission nor by this court on appeal therefrom, but that a regularly issued patent must be considered valid unless and until a court of competent jurisdiction has held otherwise.”

However, in 1974, in response to "the need to find cooperative solutions to common domestic and international economic problems" Congress enacted the Trade Act of 1974, Pub. L. No. 93-618, 88 Stat. 1978 (1975). Senate Report at 5, 1974 U.S. Code Cong. & Ad. News at 7187. The Tariff Commission was renamed the United States International Trade Commission and the remedies for violation of section 337 were strengthened. The Commission was authorized to consider invalidity and other defenses. Lannom Mfg. Co. at 1577. Specifically, the Trade Act of 1974 removed the bar to challenging a patent’s validity, and expressly authorized the Commission to consider "all legal and equitable defenses" that until that time could have been raised only in the courts. Id., citing 19 U.S.C. §1337(c). However, as revealed by the Federal Circuit, all of the references to this new ability to raise these defenses in the legislative history of the Trade Act of 1974 refer specifically to the ability to address these defenses at the Commission. See Senate Report at 196, 1974 U.S. Code Cong. & Ad. News at 7329 (“The public policy recently enunciated by the Supreme Court in the field of patent law…and the ultimate issue of the fairness of competition raised by section 337, necessitate that the Commission review the validity and enforceability of patents, for the purposes of section 337, in accordance with contemporary legal standards when such issues are raised and are adequately supported. The Committee believes the Commission may (and should when presented) under existing law review the validity and enforceability of patents, but Commission precedent and certain court decisions have led to the need for the language of amended section 337(c). The Commission is not, of course, empowered under existing law to set aside a patent as being invalid or to render it unenforceable, and the extent of the Commission's authority under this bill is to take into consideration such defenses and to make findings thereon for the purposes of determining whether section 337 is being violated.”); see also Hearings on H.R. 10710 before the Senate Committee on Finance, 93d Cong., 2d Sess. 1941 (1974) (statement of Noel Hemmendinger) (“[W]e do not believe that the statute's discrimination against the importer will be removed until the law requires the Tariff Commission to consider and rule upon the same legal defenses that are available to defendants in patent infringement suits in federal courts.”).

As the Federal Circuit recognized, “[p]atent invalidity is a statutory defense, not a regulatory duty,” Lannom Mfg. Co. at 1579, and, based on the text and purpose of the statute, along with the legislative history and Federal Circuit precedent interpreting the same, that statutory defense is only available at the Commission. Accordingly, CBP does not possess the power to address an invalidity challenge and, just as the Commission prior to the Trade Act of 1974, must presume the validity of the patents listed in the exclusion order until directed otherwise.

Notwithstanding the above, OtterBox argues, citing to VastFame, that by amending 19 U.S.C. §1337(c), Congress empowered CBP to address these defenses. However, the relevant statutory provisions and analysis thereof in VastFame counters such an interpretation. 19 U.S.C. §1337(c) states that “[t]he Commission shall determine, with respect to each investigation conducted by it under this section, whether or not there is a violation of this section….Each determination under subsection (d) or (e) of this section shall be made on the record after notice and opportunity for a hearing in conformity with the provisions of subchapter II of chapter 5 of title 5. All legal and equitable defenses may be presented in all cases.” The provision refers only to determinations made by the Commission with respect to the investigations it conducts under section 337 and makes no reference to CBP, who has no authority to conduct an investigation under this section. Moreover, VastFame does not hold otherwise and instead only confirms “that investigations under §1337(b) are governed by §1337(c)” and while no other language in §1337(c) modifies the broad reference to "all cases," the Federal Circuit held “that the phrase ‘all cases’ clearly encompasses investigations under §1337(b)” with “[t]he necessary result [being] that participants in a proceeding under §1337(b) must be permitted to raise all defenses.” OtterBox’s administrative challenge falls under CBP’s authority to issue interpretative rulings and is not a proceeding under §1337(b). As such, the mandate of §1337(c) does not authorize CBP to address OtterBox’s patent invalidity defense.

Finally, it appears even the Commission does not believe that it must entertain a challenge to the patent’s validity during every one of its proceedings considering it refused to address OtterBox’s challenge to the validity of the patents in the now-withdrawn request for an advisory opinion under 19 C.F.R. §210.79. See Otter Products Withdrawal of Request for Advisory Opinion (dated October 24, 2014) (“Furthermore, the advisory opinion proceeding announced in the Commission’s October 22, 2014 order does not meet OtterBox’s request for a full adjudication on the merits but instead deprives OtterBox of its due process rights to present all legal and equitable defenses to any allegations of violation of Section 337. (See OtterBox Request for Advisory Opinion at 3-5.) For example, the Commission’s order makes clear that OtterBox will not have the ability to challenge the validity or enforceability of the patent that is the subject of the GEO.”). As such, the Commission must read VastFame as not even applying to every proceeding it conducts, let alone applying to CBP in the administration of an exclusion order.

For all of the reasons above, CBP does not possess the authority to determine whether a patent is invalid and, to the extent there is any ambiguity in the statutory framework on this point, CBP resolves the same with an interpretation that patent invalidity challenges are outside the scope of its statutory authority. III. Claim Construction of the Term “Substantially Cover”

“It is axiomatic that dependent claims cannot be found infringed unless the claims from which they depend have been found to have been infringed[.]” Wahpeton Canvas Co. v. Frontier, Inc., 870 F.2d 1546, 1553 (Fed. Cir. 1989); see also Becton v. C.R. Bard, 922 F.2d, at 798. All of the claims at issue in the GEO depend from claim 1. Therefore, if claim 1 is not infringed, none of its dependent claims are infringed. In HQ H258492, CBP considered the claim construction of the terms “bottom surface”, “co-molded … and permanently affixed”, and “cut away portion”, as found in claim 1 of the ‘561 patent. In your request for reconsideration, you do not dispute CBP’s findings with regard to these terms. Instead, you present an argument regarding the claim construction of the term “substantially cover an exterior of the bottom and side surfaces of the flexible inner layer”, as found in claim 1 of the ‘561 patent.

CBP notes that during the investigation, the ITC issued “Order No. 13: Construing Terms of the Asserted Patent” on July 8, 2013 (“Claim Construction Order”). However, because OtterBox had no opportunity to litigate its position before the ITC, this order has no preclusive effect with regard to the question of whether the “Symmetry” products infringe the asserted claims of the ‘561 patent. See Corning Gilbert, 896 F. Supp. 2d, at 1288-89 (citing Yingbin-Nature, 535 F.3d, at 1332-33 (Fed. Cir. 2008)). As such, CBP must undertake an independent analysis to determine whether the accused products infringe. See Corning Gilbert, 896 F. Supp. 2d, at 1289. It is CBP’s position that the term “substantially cover” in claim 1 of the ‘561 patent should be construed to mean that the exterior hard layer covers a considerable amount of the total surface area comprised of all the exterior surfaces of the flexible inner layer’s four sides and bottom, such that at least one cut-away exposing a portion of the flexible inner layer’s exterior remains. Furthermore, it is CBP’s position that “substantially covers” is taught by claims 1, 2, 5 and 6.

“Quite apart from the written description and the prosecution history, the claims themselves provide substantial guidance as to the meaning of particular claim terms.” Phillips, 415 F.3d, at 1314 (citations omitted). “Other claims of the patent in question, both asserted and unasserted, can also be valuable sources of enlightenment as to the meaning of a claim term. Because claim terms are normally used consistently throughout the patent, the usage of a term in one claim can often illuminate the meaning of the same term in other claims.” Id. (citations omitted). Claim 1 of ‘561 patent reads:

1. A one-piece case for enclosing a personal electronic device comprising:

a flexible inner layer co-molded with an exterior hard layer and permanently affixed together to form a co-molded one-piece assembly;

wherein the co-molded one-piece assembly is sufficiently flexible to accept insertion of the personal electronic device and sufficiently rigid to securely retain the inserted personal electronic device, wherein:

the flexible inner layer includes a bottom surface, side surfaces joined to the bottom surface and extending upward therefrom, and a fitted cavity configured to accept and retain the inserted personal electronic device such that the bottom surface covers at least a portion of a bottom surface of the inserted personal electronic device and the side surfaces cover at least a portion of a side surface of the inserted personal electronic device;

the exterior hard layer includes a bottom surface and side surfaces sized and shaped to substantially cover an exterior of the bottom and side surfaces of the flexible inner layer and a cut away portion that is permanently filled with a portion of the co-molded flexible inner layer. (Emphasis added)

According to claim 1 of the ‘561 patent, the term “substantially cover” applies to an “exterior” that is comprised of “the bottom and side surfaces of the flexible inner layer.” As such, the hard layer needs to “substantially cover” a total surface area that consists of the sum of all four sides and the bottom. This position is consistent with Speck’s position taken in “Patent Owner Speculative Product Design, LLC's Preliminary Response”, Fellowes, Inc. v. Speculative Product Design, LLC, IPR 2013-00197 (filed Oct. 26, 2011) (“Fellowes IPR”), wherein Speck wrote that claim 1 required “that the hard exterior layer cover the exterior portion of the flexible inner layer.” See Supplemental Request for Reconsideration at Ex. A; Fellowes IPR at 16 (emphasis in the original). In fact, Speck’s diagram (below) illustrating this point did not point to the side surfaces, but the bottom surface. Id. at 17.




In your request for reconsideration, you argue that “substantially cover” must be construed to mean that the hard layer covers almost completely each and every side of the device’s flexible inner layer. See Supplemental Submission, dated Nov. 14, 2014, at 2-4. In supporting this construction, your request for reconsideration argues that construing “substantially cover” as cover “almost completely” comports with the “lay definition” of “substantially” being of, “considerable importance, value, degree, amount, or extent.” See Supplemental Submission, dated Nov. 14, 2014, at 4; Webster’s II. New College Dictionary, 1126 (3d ed. 2005). These two articulations of “substantially” do not comport in terms of magnitude, and we cannot discern any reason to extend the level of coverage to that which your request for reconsideration advocates.

First, your construction of “substantially cover” relies on Speck’s description in the Fellowes IPR of the level of coverage provided by the preferred embodiment in the ‘561, wherein “the hard layer substantially covers the flexible inner layer almost completely as shown, for example, in Figure 2A.” See Supplemental Submission, dated Nov. 14, 2014, at Ex. A, 15; Fellowes IPR at 15. However, that excerpt only shows how the preferred embodiment meets the claim limitation for “substantially cover,” and not how the invention’s other embodiments may include lower levels of coverage that are also substantial. To that point, in applying “substantially cover” to the accused articles at the ITC, the ALJ found that the suspect article’s exterior hard layer “substantially, if not entirely, covers” the bottom’s and sides’ exterior. USITC Inv. No. 337-TA-861/867, Initial Determination (“ID”), USITC Doc. ID No. 529230 at 17.




The separate inclusion of “if not entirely” indicates that there are other levels of coverage that fall short of nearly entire coverage, which can still satisfy the “substantially cover” limitation. While neither the ALJ’s findings, nor the ITC’s adoption of said findings, have a preclusive effect on CBP’s infringement analysis (See Corning Gilbert, 896 F. Supp. 2d, at 1288-89), CBP agrees with the ALJ’s implicit indication that “substantially cover” need not mean nearly 100% coverage of the inner flexible layer by the exterior hard layer. To conclude otherwise would mean artificially inflating the significant degree or extent that is inherent within “substantially” to the level of a nearly total effect – we find no persuasive evidence in the record to support that proposition. Further, even if CBP were to try to construe “substantially cover” as covering “almost completely,” your expert declared that this verbiage (“almost completely”) would still not inform a person having skill in the art as to the “scope of the invention.” See Supplemental Submission, dated Nov. 30, 2014 (“Ganaja Decl.”) at ¶16. The simultaneous advocacy of claim construction language with arguments against that language’s definiteness fails to persuade and counsels against CBP’s adoption of your position. Instead, as neither CBP nor your expert (Ganaja Decl. at ¶15) can find anywhere in the ‘561 patent wherein the patentee clearly acted as its own lexicographer and defined “substantially cover,” CBP construes the term in line with the dictionary definition provided in your request for reconsideration. Specifically, CBP construes “substantially cover” to mean covering a “considerable amount of.” See Supplemental Submission, dated Nov. 14, 2014, at 4; Webster’s II. New College Dictionary, 1126 (3d ed. 2005).

Also, the figure you reference in the Fellowes IPR and the claims of the ‘561 patent fail to support your construction in at least two more key respects: the hard layer need not “substantially cover” every facet of the case individually, and “substantially cover” must take into account the case’s bottom.

If claim 1 of the ‘561 patent required that each facet (four sides and the bottom) of the device’s flexible inner layer received substantial coverage, as you assert, then the patentee would have chosen “exteriors” instead of “exterior.” As the patentee did not do so, CBP considers “substantially cover” to only apply to the total surface area formed from the flexible inner layer’s four sides and bottom instead of the separate surface areas of each individual facet.

To support your construction requiring “substantially cover” to apply to each facet, you referenced SuperGuide Corp. v. DirectTV Inc., 358 F.3d 870 (Fed. Cir. 2004). See Supplemental Submission, dated Dec. 4, 2014. In SuperGuide, the CAFC considered whether the claim limitation “first means for storing at least one of” should be construed to modify (and hence require storage of) each member of a proceeding list of data category limitations separated by the “and” conjunction. Id. at 884-88 (emphasis in original). In this case, the invention concerned interactive electronic program guides (IPG) in television systems, which reduced RAM storage issues by allowing selective storage of only the information desired by the user. Id. at 884. The CAFC concluded that “at least one of” applies to each category, citing a basic rule of grammar in which an article of a preposition applying to all series members must either occur before the first term or else be repeated for each term. Id. at 886 (internal citations omitted). Based on the CAFC’s rationale, you argue that the “of” should similarly apply “substantially cover an exterior of” to all facets of the ‘561 device individually. We do not find this argument persuasive in construing “substantially cover an exterior of” in claim 1 of the ‘561 patent. First, the technology and purpose at issue in SuperGuide concerned selecting data elements to make the RAM of the IPG work more efficiently. In contrast to the active selection of data elements, the ‘561 patent concerns the passive level of interface between two layers (a hard outer layer, and soft inner layer). Also, the CAFC noted that each category modified by “at least one of” was “comprised of many possible values,” and that that all the inventions’ embodiments taught that the user must choose “a value” for each category. Id. at 886-87. Applying that logic to the ‘561 patent would mean that only one side and one bottom would need the “substantially cover” limitation to apply, resulting in even less coverage being necessary to meet the “substantially cover” limitation. At best, accepting that SuperGuide applies to the instant case would mean applying “substantially cover” to the total bottom area separately from the total area encompassed by all the sides.

Notwithstanding the above, and in the alternative, we also consider the offered construction in light of SuperGuide. With respect to the level of exposed soft layer exterior portions that can satisfy “substantially cover,” claim 1 also has guiding language. Specifically, claim 1 requires “a cut away portion that is permanently filled with a portion of the co-molded flexible inner layer.” Given claim 1’s need for such a “cut away portion,” the “substantially cover” limitation must correspondingly not cover so much of the soft layer as to prohibit the existence of a “cut away portion.” And, as we determined in our last ruling, the “cut away portion” in claim 1 need not exist at the device’s corners. See HQ H258492 at 18.

Claim 2 of the ‘561 patent further specifies that the cut away portion could form “an expansion portion in the co-molded one-piece assembly that contributes to the overall flexibility of the co-molded one-piece assembly.” Also, claim 5’s limitation allows the flexible inner layer to fill in the cut-away to the point of allowing a “stretch-zone that is sufficiently flexible to enable the co-molded one-piece assembly to deform and thereby accept insertion of the personal electronic device.” Claim 2’s and claim 5’s limitations mean the cut-away in claim 1 could be large enough to expand and to increase the device’s flexibility, while still satisfying the “substantially cover” limitation. Your request for reconsideration argued that the Symmetry cases’ cut-away spaces far exceeded the area needed for installation and use, and that these features ran counter to the ‘561 patent’s purpose of maximizing hard surface area. See Supplemental Request for Reconsideration at 8-9. However, contrary to that argument, claims 2 and 5 of the ‘561 clearly show that the ‘561 contemplates larger cut-away space at the cost of hard space coverage, in order to increase flexibility or to ease installation. As such, we add that the “considerable amount of” hard layer coverage in “substantially cover” must allow for at least one cut-away portion exposing some of the flexible inner layer’s “exterior” as required in claim 1 of the ‘561 patent.

Claim 6 reads:

The one-piece case of claim 1, wherein the exterior hard layer includes at least four side surfaces that intersect to form at least four corner joints and two of the corner joints comprise cut-away portions that expose the co-molded flexible inner layer. (Emphasis added)

If claim 1 of the ‘561 patent required the hard layer to exist at all on all four sides of the flexible inner layer, then claim 6’s mention of the hard layer’s coverage limitation (i.e. all four sides) would be superfluous. To hold such a position would violate the well-settled rule that claim terms must be construed “in light of the surrounding claim language, such that words in a claim are not rendered superfluous.” Digital-Vending Services Int’l, LLC v. Univ. of Phoenix, Inc., 672 F.3d 1270, 1275 (Fed. Cir 2012), quoting Phillips, 415 F.3d 1303, 1314.

Furthermore, we note that OtterBox implicitly supports CBP’s position in its filings at the USPTO, with respect to including the “bottom” as part of the “exterior” which the hard plastic layer must “substantially cover.” Specifically, OtterBox represented in its IPR of the ‘561 patent that if the “bottom” in claim 1 was the back of the phone case, then the prior art still anticipated the ‘561 patent, because the “back shell of Horwitz includes a back surface that substantially covers the bottom of the soft silicone rubber case.” See OtterBox’s Motion to Stay the GEO, Exhibit 16 (Doc. 5-3, pp. 292, 315-316) (internal citations omitted).

Based on the foregoing, it is CBP’s position, based on a reasoned and deliberate analysis, that the term “substantially cover” in claim 1 of the ‘561 patent should be construed to mean the exterior hard layer covers a considerable amount of the total surface area comprised of all the exterior surfaces of the flexible inner layer’s four sides and bottom, such that at least one cut-away exposing a portion of the flexible inner layer’s exterior remains. See Corning Gilbert, 896 F. Supp. 2d, at 1291 (citing Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 167-68 (1962)). Support for this construction is found in claims 1, 2, 5, and 6 of the ‘561 patent, and is consistent with Speck’s position taken in “Patent Owner Speculative Product Design, LLC's Preliminary Response”, in the matter of IPR 2013-00197.

You assert that the intrinsic evidence presented supports a different claim construction for the term “substantially cover.” However, as discussed above, your proposed construction is not supported by the claim language.

IV. The Products at Issue

In your submission, you assert that OtterBox’s “Symmetry” electronic devices do not infringe claims 5, 9, and 11 of the ‘561 patent. See Supplemental Submission, dated Nov. 14, 2014, at 2. In support of your position, and using the construction of “substantially cover” which CBP rejected, you calculated the surface area uncovered in all the sides applying a weighted average (the weighting depending on the length of a given side) to modulate how much coverage was lacking for the device’s sides in total. See Supplemental Submission, dated Nov. 14, 2014, at 6. These surface area calculations did not factor the bottom of the case.





Your request for reconsideration also listed the sections of uncovered portions in the base side for the iPhone 5/5S (69%) and iPhone 6 (81%). See Supplemental Submission, dated Nov. 14, 2014, at 5. Each of those figures is somewhat above what was listed in the tables you provided; as such, we will take into account the lower numbers as the lower quantities of uncovered base sides match both your request for reconsideration’s tables, as well as the exhibits provided. Id at 6, Ex. B-C. . Given those measurements, you concluded that the uncovered portions of the base side were so bare (with respect to coverage by the exterior hard layer) as to remove the Symmetry cases from the claim scope you construed. Id. at 7. In your request for reconsideration, you submitted the following images of for the Symmetry cases at issue:





A. Claim 1 of the ‘561 patent

As a preliminary matter, since your request for reconsideration only disputes the claim term “substantially cover” as found in claim 1 of the ‘561 patent, we hereby adopt all other claim 1 language constructions in HQ H258492, in the interests of economy to focus the infringement analysis in this decision on the claim term “substantially cover.” Similarly, we also adopt all findings of fact in HQ H258492 regarding whether the Symmetry cases meet any of claim 1’s limitations, not including the “substantially cover” claim limitation. As discussed above, CBP construes “substantially cover” in claim 1 of the ‘561 patent to mean the exterior hard layer covers a considerable amount of the total surface area comprised of all the exterior surfaces of the flexible inner layer’s four sides and bottom, such that at least one cut-away exposing a portion of the flexible inner layer’s exterior remains.

Turning to whether the Symmetry cases include the “substantially cover” claim limitation, we find that the exterior surfaces of the accused product’s flexible inner layer (red) are covered to a considerable amount in a hard plastic shell (gray), with the exception of certain cutouts. Our finding here is informed by the ITC whose infringement analysis examined the device’s bottom. ID at 17.




Again, while neither the ALJ’s findings, nor the ITC’s adoption of said findings, have a preclusive effect on CBP’s infringement analysis (See Corning Gilbert, 896 F. Supp. 2d, at 1288-89), CBP agrees with the ITC infringement analysis framework. The ITC infringement analysis of the bottom of the case shows – as can be visually determined – that the bottom both provides the bulk of the flexible inner layer exterior for the hard plastic layer that can be covered, and that the bottom is indeed substantially covered. Id. The Symmetry case bottoms also have nearly the entirety of the flexible inner layer’s exterior covered in hard plastic. With respect to the sides of the Symmetry cases, every side (except the base sides) has the majority of flexible inner layer surface covered in hard plastic. The back’s flexible inner layer’s exterior is nearly 100% covered, and three out of four sides on each device have the majority of their flexible inner layer exterior covered. This quantum of coverage comports with “substantially cover” in claim 1 of the ‘561 patent meaning a considerable amount.

Further, infringement would result even if CBP adopted a claim construction under SuperGuide that required “substantially cover” to apply to the sides’ total surface area, separately from the bottom’s total surface area. In such a construction, for both phone cases, the aggregate level of side coverage is at least over half the side surfaces’ flexible inner layer. It is difficult to see coverage resulting in over half the relevant area as not a considerable amount. As such, CBP has determined that the exterior hard layer covers a considerable amount of the total surface area comprised of all the exterior surfaces of the flexible inner layer’s four sides and bottom.

However, as CBP has construed “substantially cover” to necessitate at least one cut away portion, the coverage by the hard plastic layer must allow for at least one such a cutaway. To that point, the ITC analysis notes the near entire coverage by the hard layer, leaving enough exposure for cutaway portions. Similarly, cutaways are present in the Symmetry case sides (including the base side), and those cutaways are – as claim 1 mandates – “permanently filled with a portion of the co-molded flexible inner layer.” As such, the accused products include an “exterior hard layer [which] includes a bottom surface and side surfaces sized and shaped to substantially cover an exterior of the bottom and side surfaces of the flexible inner layer and a cut away portion that is permanently filled with a portion of the co-molded flexible inner layer” as recited in claim 1.

Upon examination of the images provided in light of our construction of “substantially cover,” in combination with the unchallenged conclusions of law and findings of fact in HQ H258492, CBP maintains its position held in HQ H258492 that the accused products above contain all of the limitations set forth in claim 1 of the ‘561 patent.

Also, in your request for reconsideration, you submitted expert testimony, from a person skilled in the relevant art, which asserted that the claim term “substantially cover” did not cover the Symmetry products at issue. See Supplemental Submission, dated Nov. 30, 2014 (Ganaja Decl. at ¶17). Your expert also asserted that he could not determine precisely what “substantially cover” means. Id. However, expert testimony from Speck – also by a person skilled in the art – contradicts this position with a thorough and on-point analysis (shown in part below) including a specific element-by-element examination of the Symmetry cases for the iPhone 5 and 5s, as well as the iPhone 6, including images showing how the cases at issue fall under the “substantially cover” limitation. See H258492 case file at Exhibit 1, Declaration of Tim Osswald, Ph.D. (available from CBP), Osswald Decl. at ¶16, 32, 34. The Speck expert analysis also shows how the base side of the iPhone 6 functions as a cut-away portion. Id. at ¶34. In reviewing these analyses, we find the clearer and more detailed Speck review to be more persuasive.






As OtterBox has not advanced any other arguments concerning the claim limitations of claims 5, 9, and 11, as to either their construction or application to Symmetry cases, CBP maintains its position held in HQ H258492 that the accused products practice all of the limitations set forth in claims 5, 9, and 11 of the ‘561 patent. As such, CBP finds that the accused products infringe claims 5, 9, and 11 of the ‘561 patent.

HOLDING:

I. CBP is not precluded by 19 C.F.R. §177.7(b) from issuing a ruling on the accused OtterBox “Symmetry” electronic device cases.

II. CBP does not possess the power to address OtterBox’s challenge to the validity of the ‘561 patent.

III. CBP’s holds that “substantially cover” in claim 1 of the ‘561 is construed to mean the exterior hard layer covers a considerable amount of the total surface area comprised of all the exterior surfaces of the flexible inner layer’s four sides and bottom, such that at least one cut-away exposing a portion of the flexible inner layer’s exterior remains.

IV. CBP holds that OtterBox “Symmetry” electronic device cases (specifically, Part Nos. 11-37555-4W, 11-30188-J1, 11-37561-5B, 16-46190-J1, 16-46190-6N, and 16-46190-9U, taken from Entry XXX-XXXX640-3), are covered by the asserted claims of the ‘561 patent and therefore fall within the scope of the ITC’s General Exclusion Order in Investigation No. 337-TA-861/867, such that they would be excluded from entry for consumption into the United States.

EFFECT ON OTHER RULINGS:

Headquarters Ruling Letter H258492, dated November 4, 2014, is AFFIRMED.


Sincerely,

Charles R. Steuart, Chief
Intellectual Property Rights Branch