• HQ H329187
• Jul 18, 2023

• Type : 19 U.S.C. § 1337; Unfair Competition • HTSUS :
•  Related:   H324813; H323308; H282234; H311351; H326291   

OT:RR:BSTC:EOE H329187 FKM

Benjamin C. Elacqua
Fish & Richardson P.C.
909 Fannin St. Suite 2100
Houston, Texas 77010

VIA EMAIL: [email protected]; [email protected]

RE: Ruling Request; U.S. International Trade Commission; Limited Exclusion Order; Investigation No. 337-TA-1266; Certain Wearable Devices with ECG Functionality and Components Thereof

Dear Mr. Elacqua:

Pursuant to 19 C.F.R. Part 177, the Exclusion Order Enforcement Branch (“EOE Branch”), Regulations and Rulings, U.S. Customs and Border Protection (“CBP”) issues this ruling letter. We find that Apple Inc. (“Apple”) has met its burden to show that certain redesigned wearable devices (“articles at issue”) do not infringe one or more of claims 12, 13, and 19-23 of U.S. Patent No. 10,638,941 (“the ’941 Patent”) and claims 1, 3, 5, 8-10, 12, 15, and 16 of U.S. Patent No. 10,595,731 (“the ’731 Patent). Thus, CBP’s position is that the articles at issue are not subject to the limited exclusion order that the U.S. International Trade Commission (“Commission” or “ITC”) issued in Investigation No. 337-TA-1266 (“the underlying investigation” or “the 1266 investigation”), pursuant to section 337 of the Tariff Act of 1930, as amended, 19 U.S.C. § 1337 (“section 337”). Entry for consumption into the United States, entry for consumption from a foreign trade zone, or withdrawal from a warehouse for consumption of the articles at issue, however, is conditioned on the drafting and submission of a certification, as provided for in this ruling, that would take effect should the Commission lift the suspension on enforcement of the limited exclusion order. We further note that determinations of the Commission resulting from the underlying investigation or a related proceeding under 19 C.F.R. Part 210 are binding authority on CBP and, in the case of conflict, will by operation of law modify or revoke any contrary CBP ruling or decision regarding application of an exclusion order under section 337. This ruling letter is the result of a request for an administrative ruling from CBP under 19 C.F.R. Part 177, which was conducted on an inter partes basis. The process involved the two parties with a direct and demonstrable interest in the question presented by the ruling request: (1) your client, Apple, the ruling requester and respondent in the 1266 investigation; and (2) AliveCor, Inc. (“AliveCor”), complainant in the 1266 investigation. See, e.g., 19 C.F.R. § 177.1(c).

The parties were asked to clearly identify confidential information, including information subject to the administrative protective order in the underlying investigation, with [[red brackets]] in all of their submissions to CBP. See 19 C.F.R. §§ 177.2; 177.8. If there is additional information in this ruling letter not currently bracketed in red [[ ]] that either party believes constitutes confidential information, and should be redacted from the published ruling, then the parties are asked to contact CBP within ten (10) working days of the date of this ruling letter. See, e.g., 19 C.F.R. § 177.8(a)(3).

Please note that disclosure of information related to administrative rulings under 19 C.F.R. Part 177 is governed by, for example, 6 C.F.R. Part 5, 31 C.F.R. Part 1, 19 C.F.R. Part 103, and 19 C.F.R. § 177.8(a)(3). See, e.g., 19 C.F.R. § 177.10(a). In addition, CBP is guided by the laws relating to confidentiality and disclosure, such as the Freedom of Information Act (“FOIA”), as amended (5 U.S.C. § 552), the Trade Secrets Act (18 U.S.C. § 1905), and the Privacy Act of 1974, as amended (5 U.S.C. § 552a). A request for confidential treatment of information submitted in connection with a ruling requested under 19 C.F.R. Part 177 faces a strong presumption in favor of disclosure. See, e.g., 19 C.F.R. § 177.8(a)(3). The person seeking this treatment must overcome that presumption with a request that is appropriately tailored and supported by evidence establishing that: the information in question is customarily kept private or closely-held and either that the government provided an express or implied assurance of confidentiality when the information was shared with the government or there were no express or implied indications at the time the information was submitted that the government would publicly disclose the information. See Food Marketing Institute v. Argus Leader Media, 139 S. Ct. 2356, 2366 (2019) (concluding that “[a]t least where commercial or financial information is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy, the information is ‘confidential’ within the meaning of exemption 4.”); see also U.S. Department of Justice, Office of Information Policy: Step-by-Step Guide for Determining if Commercial or Financial Information Obtained from a Person is Confidential Under Exemption 4 of the FOIA (updated 10/7/2019).

BACKGROUND

ITC Investigation No. 337-TA-1266

Procedural History at the ITC

The Commission instituted Investigation No. 337-TA-1266 on May 26, 2021, based on a complaint filed by AliveCor. Certain Wearable Electronic Devices with ECG Functionality and Components Thereof, Inv. No. 337-TA-1266, EDIS Doc. ID 788332, Public Commission Opinion (Dec. 22, 2022) (“Comm’n Op.”) at 4 (citing 86 Fed. Reg. 28382 (May 26, 2021)). The complaint, as supplemented, alleged a violation of section 337 by reason of infringement of certain claims of the ’731 patent, the ’941 patent, and U.S. Patent No. 9,572,499 (“the ’499 patent”). Id. The notice of investigation named Apple as the sole respondent. Id. The Commission’s Office of Unfair Import Investigations (“OUII”) was named as a party in the investigation. Id.

On June 27, 2022, the Administrative Law Judge (“ALJ”) issued the final initial determination (“FID”) finding a violation of section 337. Id. at 5. Specifically, the ALJ determined that a violation of section 337 occurred in the importation into the United States, the sale for importation, or the sale within the United States after importation, of the accused products that infringed the ’731 and ’941 patents, but these products were found not to infringe the ’499 patent. Id.

On September 22, 2022, the Commission issued a notice in which it determined to review the FID in part and requested submissions responding to the Commission’s issues under review and on remedy, the public interest, and bonding. Id. at 6 (citing 87 Fed. Reg. 58819-21 (Sept. 28, 2022)). On December 7, 2022, Apple filed an emergency motion requesting the Commission to suspend any remedial order or extend the target date and stay all proceedings prior to the issuance of a Final Determination, pending the resolution of any appeal of the decision by the Patent Trial and Appeal Board (“PTAB”). Id. (quoting Respondent Apple Inc.’s Emergency Motion to Suspend any Remedy or Extend the Target Date and Stay Proceedings Pending Resolution of any Appeal of the Patent Office’s Decision that United States Patent Nos. 10,638,941, 10,595,731, and 9,572,499 Are Unpatentable at 1). The Commission, in its review of the FID, found a violation of section 337 as to the ’941 and ’731 patents and determined that the appropriate remedy was a limited exclusion order and cease and desist order. Id. at 88. The Commission “determined to suspend enforcement of the orders, including the bond provision, pending final resolution of the PTAB’s Final Written Decision finding the asserted claims of the ’941, ’731, and ’499 patents unpatentable.” Id. As of this time, final resolution of that decision has not been reached.

In the limited exclusion order, the Commission ordered that “[w]earable electronic devises with ECG functionality and components thereof that infringe one or more of claims 12, 13, and 19-23 of the ’941 patent; and claims 1, 3, 5, 8-10, 12, 15, and 16 of the ’731 patents that are manufactured abroad by or on behalf of, or imported by or on behalf of, Respondent or any of its affiliated companies, parents, subsidiaries, or other related business entities, or their successors or assigns, are excluded from entry for consumption into the United States, entry for consumption from a foreign-trade zone, or withdrawal from a warehouse for consumption, for the remaining terms of the patents, except under license of the patent owner or as provided by law, except for articles or components imported for us in servicing, repairing, or replacing covered articles that were imported prior to the effective date of this Order pursuant to existing service and warranty contracts.” Certain Wearable Electronic Devices with ECG Functionality and Components Thereof, Inv. No. 337-TA-1266, EDIS Doc. ID 786802, Limited Exclusion Order (Dec. 22, 2022) at 2 (“1266 LEO”). The Commission defined the articles covered by the limited exclusion order as “Apple Watches with ECG functionality, and hardware and software components thereof.” Id. Additionally, the Commission ordered that “[t]he enforcement of this Order, including the bond provision is suspended pending final resolution of the U.S. Patent and Trademark Office, Patent Trial and Appeal Board’s Final Written Decisions finding the asserted patent claims unpatentable.” Id. at 3 (citing Apple, Inc. v. AliveCor, Inc., IPR2021-00971, Patent 10,595,731, Final Written Decision Determining All Challenged Claims Unpatentable (Dec. 6, 2022); Apple, Inc. v. AliveCor, Inc., IPR2021-00972, Patent 10,638,941, Final Written Decision Determining All Challenged Claims Unpatentable (Dec. 6, 2022); and 35 U.S.C. § 318(b)).

The Articles from the Underlying Investigation

The legacy articles in the underlying investigation consisted of four generations of Apple smartwatches. Certain Wearable Electronic Devices with ECG Functionality and Components Thereof, Inv. No. 337-TA-1266, EDIS Doc. ID 776234, Public Final Initial Determination (June 27, 2022) (“FID”) at 5-6. These generations of Apple smartwatches, along with their corresponding model numbers, are reproduced below:




Id. at 6.

The parties stipulated that the Apple Watch Series 6 was representative with respect to the hardware of the legacy articles and that version 7.6.2 of Apple’s operating system, WatchOS, was representative of all of the software implicated by the asserted patent claims. Id. (internal citations omitted).

The Patent Claims in the 1266 LEO

The 1266 LEO prohibits the unlicensed entry for consumption of wearable electronic devices with ECG functionality and components thereof that infringe one or more of claims 12, 13, and 19-23 of the ’941 patent; and claims 1, 3, 5, 8-10, 12, 15, and 16 of the ’731 patent and that are manufactured abroad by, or on behalf of, or imported by or on behalf of, Apple, or any of its affiliated companies, parents, subsidiaries, or other related business entities, or their successors or assigns. See 1266 LEO at 1. In describing the patents at issue, the FID notes that they:

. . . relate to systems, devices, and methods for monitoring cardiac health and managing cardiac disease. See 941 patent at 1:26-33; 731 patent at 1:29-33. The specific cardiac condition addressed by all the asserted claims is arrhythmia, or abnormal heart rhythm. See 941 patent at 4:9-10; []. The devices recited in the claims, including in the method claims, [is] a smartwatch (for the 941 and 731 patents) []. The smartwatch claims require an electrocardiogram (ECG) sensor and at least one other sensor. See, e.g., 941 patent at cl. 1; 731 patent at cl. 25. For most asserted smartwatch claims one of the other sensors is a photoplethysmogram (PPG) sensor, which detects heart rate optically. See 731 patent at 8:51-55. [] Whether reciting a method or apparatus, the asserted independent claims generally involve monitoring heart rate [], detecting or determining possible arrhythmia or irregularity in heart rate variability (“HRV”) (e.g., “detect, based on the PPG data, the presence of an arrythmia” (731 patent at cl. 1)), and either performing an ECG or alerting the user that an ECG is called for (e.g., “receive electric signals of the user from the ECG sensor to confirm the presence of the arrythmia” (941 patent at cl. 12)).

FID at 3-4.

Claim 12 of the ’941 Patent

The ’941 patent is titled “Discordance Monitoring.” Id. at 3 (citing ’941 patent). Claim 12 of the ’941 patent is the only independent claim, with the remaining claims depending directly from claim 12. Id. at 30. Claim 12 of the ’941 patent is reproduced below:

12. A smartwatch, comprising: a processor; a first sensor configured to sense an activity level value of a user, wherein the first sensor is coupled to the processor; a photoplethysmogram (“PPG”) sensor configured to sense a heart rate parameter of the user when the activity level value is resting, wherein the PPG sensor is coupled to the processor; an electrocardiogram (“ECG”) sensor configured to sense electrical signals of a heart, wherein the ECG sensor comprises a first electrode and a second electrode, and wherein the ECG sensor is coupled to the processor; and a non-transitory computer readable storage medium encoded with a computer program including instructions executable by the processor to cause the processor to: determine if a discordance is present between the activity level value of the user and the heart rate parameter of the user; based on the presence of the discordance, indicate to the user a possibility of an arrhythmia being present; and receive electric signals of the user from the ECG sensor to confirm the presence of the arrhythmia.

Id. at 30-31; ’941 patent at 17:52-18:19.

Claim 1 of the ’731 Patent

The ’731 patent is titled “Methods and Systems for Arrhythmia Tracking and Scoring.” FID at 3 (citing ’731 patent). Claim 1 of the ’731 patent is the only independent claim, with the remaining claims depending directly from claim 1. Id. at 105. Claim 1 of the ’731 patent is reproduced below: 1. A smart watch to detect the presence of an arrhythmia of a user, comprising: a processing device; a photoplethysmography (“PPG”) sensor operatively coupled to the processing device; an ECG sensor, comprising two or more ECG electrodes, the ECG sensor operatively coupled to the processing device; a display operatively coupled to the processing device; and a memory, operatively coupled to the processing device, the memory having instructions stored thereon that, when executed by the processing device, cause the processing device to: receive PPG data from the PPG sensor; detect, based on the PPG data, the presence of an arrhythmia; receive ECG data from the ECG sensor; and confirm the presence of the arrhythmia based on the ECG data.

Id.; ’731 patent at 26:27-46.

19 C.F.R. Part 177 Ruling Request

Procedural History

On December 23, 2022, Apple submitted a letter to CBP requesting an administrative ruling pursuant to 19 C.F.R. Part 177, which included three sets of expert declarations and exhibits (collectively, “Ruling Request”). Apple Email to EOE Branch, dated December 23, 2022. Apple “request[ed] a ruling [] that certain wearable electronic devices and components thereof to be imported by Apple are not subject to exclusion from entry for consumption into the United States, because they have been redesigned to [[ ]] covered by the Limited Exclusion Order [] issued on December 22, 2022 by the ITC in the 1266 Investigation.” Ruling Request at 1. In the same e-mail, Apple also confirmed that Apple had begun the process of entering into a non-disclosure agreement with AliveCor and would provide the Ruling Request to AliveCor once the agreement had been executed. Apple Email to EOE Branch, dated December 23, 2022. AliveCor sent the signed agreement later that day, and, in response, Apple provided access to the Ruling Request. AliveCor Email to Apple and EOE Branch, dated December 23, 2022; Apple Email to AliveCor and EOE Branch, dated December 23, 2022.

On December 30, 2022, the EOE Branch had an initial conference call with Apple and AliveCor, on which both parties agreed to conduct the ruling request on an inter partes basis administered by the EOE Branch. See EOE Email to Parties, dated December 30, 2022. Also during this initial call, the EOE Branch and the parties discussed scheduling for the inter partes ruling, and after failing to reach agreement on a proposed procedural schedule, the parties submitted proposals to the EOE Branch. See Apple Email to EOE Branch, dated January 3, 2023; AliveCor Email to EOE Branch, dated January 3, 2023. On January 9, 2023, after considering the party submissions, the EOE Branch established the procedural schedule for the inter partes proceeding. EOE Branch email to Parties, dated January 9, 2022. After multiple correspondences related to confidentiality, the EOE Branch requested that Apple address and redesignate information that had been marked as confidential in its Ruling Request, which was ultimately provided on January 30, 2023. See EOE Branch Email to Parties, dated January 13, 2023; see also Apple Email to EOE Branch, dated January 30, 2023. Additionally, on January 25, 2023, the EOE Branch reiterated its position regarding confidentiality in response to concerns raised by AliveCor. EOE Email to Parties, dated January 25, 2023. After considering further issues raised by the parties with respect to the inspection of the articles at issue, the EOE Branch modified the procedural schedule on February 9 and again on February 14. EOE Email to Parties, dated February 9, 2023; EOE Email to Parties, dated February 14, 2023. On February 27, 2023, AliveCor provided its response to the Ruling Request, which included one declaration and Exhibits 1 to 4 (collectively, “AliveCor Response”). On March 6, 2023, Apple provided its reply to AliveCor’s Response, which included two declarations, one exhibit, and thirty-eight files of supporting materials (collectively, “Apple Reply”). On March 13, 2023, AliveCor provided its sur-reply, which contained a declaration and one exhibit (collectively, “AliveCor Sur-Reply”) to Apple’s Reply. On March 20, 2023, the EOE Branch conducted an oral discussion with the parties, for which both parties submitted presentations. Finally, on March 27, 2023, the parties submitted post-oral discussion submissions (“Apple Post-Oral Discussion Submission” and “AliveCor Post-Oral Discussion Submission,” respectively).

The Articles at Issue

The articles at issue are described in the Ruling Request as “certain wearable electronic devices and components thereof to be imported by Apple . . . [that] have been redesigned to [[ ]][.]” Ruling Request at 1. Specifically, the products for which Apple requested a ruling are the “Apple Watch Ultra, the current Apple Watch Series 8, and earlier Apple Watches with ECG functionality (Watch Series 4 through 7).” Id. at 1-2. According to the Ruling Request, “[i]n the ITC’s words, Apple’s Watch products used to infringe by recording an ECG, analyzing the ECG data, and then providing a conclusion to the user based on that data about whether the user experienced an arrhythmia. [[ ]] [] The software for every redesigned product intended for import and sale into the United States has been changed to [[ ]]” Id. at 2 (internal citations omitted). To implement the redesign, Apple:

[[ ] ]] Then Apple [[ ]] [] Whenever a redesigned Watch product . . . attempts to render—i.e., show—a user interface [[

]]

Id. at 11-12 (internal citations omitted).

Due to this redesigned functionality characterized above, Apple argues that the articles at issue cannot “[[

]]” Id. at 12 (internal citations omitted).

ISSUE

Whether Apple has met its burden to show that the articles at issue do not infringe the ’731 or ’931 patents, and thus are not subject to the limited exclusion order issued in the 1266 investigation. See Ruling Request at 20.

LEGAL FRAMEWORK

Section 337 Exclusion Order Administration

The Commission shall investigate any alleged violation of section 337 to determine, with respect to each investigation conducted by it under this section, whether there is a violation of this section. See 19 U.S.C. § 1337(b)(1) and (c). If the Commission determines, as a result of an investigation under this section, that there is a violation of this section, it shall direct that the articles concerned, imported by any person violating the provision of this section, be excluded from entry into the United States unless the Commission finds based on consideration of the public interest that such articles should not be excluded from entry. See 19 U.S.C. § 1337(d)(1).

When the Commission determines that there is a violation of section 337, it generally issues one of two types of exclusion orders: (1) a limited exclusion order or (2) a general exclusion order. See Fuji Photo Film Co., Ltd. v. ITC, 474 F.3d 1281, 1286 (Fed. Cir. 2007). Both types of orders direct CBP to bar infringing products from entering the country. See Yingbin-Nature (Guangdong) Wood Indus. Co. v. ITC, 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. In contrast, a general exclusion order bars the importation of infringing products by everyone, regardless of whether they were respondents in the Commission’s investigation.” Id. A general exclusion order is appropriate only if two exceptional circumstances apply. See Kyocera Wireless Corp. v. ITC, 545 F.3d 1340, 1356. 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 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 [general exclusion order] by satisfying the heightened burdens of §§ 1337(d)(2)(A) and (B).”).

In addition to the action taken above, the Commission may issue an order under 19 U.S.C. § 1337(i) directing CBP to seize and forfeit articles attempting entry in violation of an exclusion order if their owner, importer, or consignee previously had articles denied entry on the basis of that exclusion order and received notice that seizure and forfeiture would result from any future attempt to enter articles subject to the same. An exclusion order under § 1337(d)—either limited or general—and a seizure and forfeiture order under § 1337(i) apply at the border only and are operative against articles presented for customs examination or articles conditionally released from customs custody but still subject to a timely demand for redelivery. See 19 U.S.C. §§ 1337(d)(1) (“The Commission shall notify the Secretary of the Treasury of its action under this subsection directing such exclusion from entry, and upon receipt of such notice, the Secretary shall, through the proper officers, refuse such entry.”); id., at (i)(3) (“Upon the attempted entry of articles subject to an order issued under this subsection, the Secretary of the Treasury shall immediately notify all ports of entry of the attempted importation and shall identify the persons notified under paragraph (1)(C).”) (emphasis added).

Significantly, unlike district court injunctions, the Commission can issue a general exclusion order that broadly prohibits entry of articles that violate section 337 of the Tariff Act of 1930 without regard to whether the persons importing such articles were parties to, or were related to parties to, the investigation that led to issuance of the general exclusion order. See Vastfame Camera, Ltd. v. ITC, 386 F.3d 1108, 1114 (Fed. Cir. 2004). The Commission also has recognized that even limited exclusion orders have broader applicability beyond just the parties found to infringe during an investigation. See Certain GPS Devices and Products Containing Same, Inv. No. 337-TA-602, Comm’n Op. at 17, n.6, Doc ID 317981 (Jan. 2009) (“We do not view the Court’s opinion in Kyocera as affecting the issuance of LEOs [limited exclusion orders] that exclude infringing products made by respondents found to be violating Section 337, but imported by another entity. The exclusionary language in this regard that is traditionally included in LEOs is consistent with 19 U.S.C. § 1337(a)(1)(B)-(D) and 19 U.S.C. § 1337(d)(1).”).

Moreover, “[t]he Commission has consistently issued exclusion orders coextensive with the violation of section 337 found to exist.” See Certain Erasable Programmable Read Only Memories, Inv. No. 337-TA-276, Enforcement Proceeding, Comm’n Op. at 11, Doc ID 43536 (Aug. 1991) (emphasis added). “[W]hile individual models may be evaluated to determine importation and [violation], the Commission’s jurisdiction extends to all models of [violative] products that are imported at the time of the Commission’s determination and to all such products that will be imported during the life of the remedial orders.” See Certain Optical Disk Controller Chips and Chipsets, Inv. No. 337-TA-506, Comm’n Op. at 56-57, USITC Pub. 3935, Doc ID 287263 (July 2007).

Lastly, despite the well-established principle that “the burden of proving infringement generally rests upon the patentee [or plaintiff],” Medtronic, Inc. v. Mirowski Family Ventures, LLC, 571 U.S. 191 (2014), the Commission has held that Medtronic is not controlling precedent and does not overturn its longstanding practice of placing the burden of proof on the party who, in light of the issued exclusion order, is seeking to have an article entered for consumption. See Certain Sleep-Disordered Breathing Treatment Systems and Components Thereof, Inv. No. 337-TA-879, Advisory Opinion at 6-11. In particular, the Commission has noted that “[t]he Federal Circuit has upheld a Commission remedy which effectively shifted the burden of proof on infringement issues to require a company seeking to import goods to prove that its product does not infringe, despite the fact that, in general, the burden of proof is on the patent to prove, by a preponderance of the evidence, that a given article does infringe. . . .” Certain Integrated Circuit Telecommunication Chips, Inv. No. 337-TA-337, Comm’n Op. at 21, n.14, USITC Pub. 2670, Doc ID 217024 (Aug. 1993), (emphasis in original) (citing Sealed Air Corp. v. ITC, 645 F.2d 976, 988-89 (C.C.P.A. 1981)).

This approach is supported by Federal Circuit precedent. See Hyundai Elecs. Indus. Co. v. ITC, 899 F.2d 1204, 1210 (Fed. Cir. 1990) (“Indeed, we have recognized, and Hyundai does not dispute, that in an appropriate case the Commission can impose a general exclusion order that binds parties and non-parties alike and effectively shifts to would-be importers of potentially infringing articles, as a condition of entry, the burden of establishing noninfringement. The rationale underlying the issuance of general exclusion orders—placing the risk of unfairness associated with a prophylactic order upon potential importers rather than American manufacturers that, vis-a-vis at least some foreign manufacturers and importers, have demonstrated their entitlement to protection from unfair trade practices—applies here [in regard to a limited exclusion order] with increased force.”) (emphasis added) (internal citation omitted).

Patent Infringement Generally

Determining patent infringement requires two steps. Advanced Steel Recovery, LLC v. X-Body Equip., Inc., 808 F.3d 1313, 1316 (2015). The first is to construe the limitations of the asserted claims and the second is to compare the properly construed claims to the accused product. Id. To establish literal infringement, every limitation recited in a claim must be found in the accused product whereas, under the doctrine of equivalents, infringement occurs when there is equivalence between the elements of the accused product and the claimed elements of the patented invention. Microsoft Corp. v. GeoTag, Inc., 817 F.3d 1305, 1313 (Fed. Cir. 2016). One way to establish equivalence is by showing, on an element-by-element basis, that the accused product performs substantially the same function in substantially the same way with substantially the same result as each claim limitation of the patented invention, which is often referred to as the function-way-result test. See Intendis GmbH v. Glenmark Pharms., Inc., 822 F.3d 1355, 1361 (Fed. Cir. 2016).

As for the first step above, “claim construction is a matter of law.” SIMO Holdings, Inc. v. H.K. uCloudlink Network Tech., Ltd., 983 F.3d 1367, 1374 (Fed. Cir. 2021). Moreover, the ultimate construction of a claim limitation is a legal conclusion, as are interpretations of the patent’s intrinsic evidence (the patent claims, specifications, and prosecution history). UltimatePointer, L.L.C. v. Nintendo Co., 816 F.3d 816, 822 (Fed. Cir. 2016) (citing Teva Pharms. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 841, 190 L. Ed. 2d 719 (2015)).

“Importantly, 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.” Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed. Cir. 2005) (en banc). “In some cases, the ordinary meaning of claim language as understood by a person of skill in the art may be readily apparent even to lay judges.” Id. at 1314. In others, courts look to public sources such as “the words of the claims themselves, the remainder of the specification, the prosecution history, and extrinsic evidence concerning relevant scientific principles, the meaning of technical terms, and the state of the art.” Id.

“To begin with, the context in which a term is used in the asserted claim can be highly instructive.” Phillips, 415 F.3d at 1314 (“To take a simple example, the claim in this case refers to ‘steel baffles,’ which strongly implies that the term ‘baffles’ does not inherently mean objects made of steel.”). The context in which a claim term is used also includes the full chain of dependence as well as the remaining suite of claims and the written description. See Inline Plastics Corp. v. EasyPak, LLC, 799 F.3d 1364, 1371 (Fed. Cir. 2015) (“Since the specification explicitly mentions the ‘alternative’ . . . there can be no debate concerning the application of the doctrine of claim differentiation.”).

The second step to establish infringement involves a comparison of the claims, as properly construed, to the accused product, which is a question of fact. Apple Inc. v. Samsung Elecs. Co., Ltd., 839 F.3d 1034, 1040 (Fed. Cir. 2016) (en banc).

Patent Infringement Based on Capability or Actual Operation

When applying the two-step inquiry for patent infringement noted above, certain cases at the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit”) have held that, to find infringement, a device only needs to be capable of operating according to the relevant claim limitations while others have found that a device does not infringe unless it actually operates as claimed. See INVT SPE LLC v. ITC, 46 F.4th 1361, 1371 (Fed. Cir. 2022) (citing Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197, 1204 (Fed. Cir. 2010) for the former and ParkerVision, Inc. v. Qualcomm Inc., 903 F.3d 1354, 1361 (Fed. Cir. 2018) for the latter). “Whether infringement requires actual performance of the recited functions by the accused device depends on the claim language.” INVT, 46 F.4th at 1371. “[T]he most straightforward example of this is the common distinction between method claims and apparatus claims” where “non-method claims describe capabilities without requiring that any software components be ‘active’ or ‘enabled’” and method claims that “require[] actual performance of each claimed step.” Id. (quoting and citing Finjan, 626 F.3d at 1204-05, 1206).

Nevertheless, “differences exist between apparatus claims as well, depending on the claim language. [The Federal Circuit has] construed some apparatus claims to require an infringing device to actually perform and operate according to the functional terms recited in the claim” but “construed other apparatus claims to require only capability[.]” INVT at 1371. For example, in Finjan, because the “defendants admitted [the] program code for the relevant function . . . was literally present on all accused devices, the claim was infringed ‘in the same way that an automobile engine for propulsion exists in a car even when the car is turned off.’” INVT at 1373 (quoting Finjan at 1205). “The presence of that programming in the accused products was all that was necessary for establishing infringement.” Id. “In other words, the claims recite[d] a device with the capability of performing the recited functions when in operation without any modification or further programming.” Id. at 1374. “To determine if an accused device is a device with the ‘capability’ of performing the recited functions, it must be able to perform those functions when it is activated and put into operation.” Id. at 1375. Accordingly, the Federal Circuit has established that for infringement of:

a claim that recites capability and not actual operation, an accused device “need only be capable of operating” in the described mode. Intel Corp. v. U.S. Int'l Trade Comm’n, 946 F.2d 821, 832 (Fed. Cir. 1991). Thus, depending on the claims, “an accused device may be found to infringe if it is reasonably capable of satisfying the claim limitations, even though it may also be capable of noninfringing modes of operation.” Hilgraeve Corp. v. Symantec Corp., 265 F.3d 1336, 1343 (Fed. Cir. 2001).

Finjan, 626 F.3d at 1204 (emphasis added).

Moreover, the Federal Circuit has held that an accused device is considered “reasonably capable” of satisfying the claim limitations when one can enable the mode that would infringe “without significant alteration.” See INVT, 46 F.4th at 1373-75 (“We held [in Silicon Graphics and Fantasy Sports] that the apparatus claim directed to a computer, claimed in functional terms, is nonetheless infringed so long as the product is designed in such a way as to enable a user of that [product] to utilize the function . . . without having to modify [the product]—i.e., capable of the functions.”) (quoting Silicon Graphics, Inc. v. ATI Techs., Inc., 607 F.3d 784, 795 (Fed. Cir. 2010) and Fantasy Sports Props., Inc. v. Sportsline.com, Inc., 287 F.3d 1108, 1118 (Fed. Cir. 2002) (internal quotation marks omitted) (emphasis added); see also Versata Software, Inc. v. SAP Am., Inc., 717 F.3d 1255, 1262 (Fed. Cir. 2013) (“[A] device does not infringe simply because it is possible to alter it in a way that would satisfy all the limitations of a patent claim[.]”) (quoting High Tech Med. Instrumentation v. New Image Indus., Inc., 49 F.3d 1551, 1555 (Fed. Cir. 1995).

In sum, when the asserted claims recite capability, our case law supports finding infringement by a ‘reasonably capable’ accused device on a case-by-case basis particularly where . . . there is evidence that the accused device is actually used in an infringing manner and can be so used without significant alterations.”

Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d 1201, 1217 (Fed. Cir. 2014) (emphasis added).

LAW AND ANALYSIS

The Infringement Question Regarding the Articles at Issue

To begin, the parties do not dispute any factual question related the actual operation of the articles at issue and agree that they function in the manner Apple has described throughout this inter partes proceeding. Oral Discussion Transcript at 95:22-25 (“[AliveCor] agree[s] . . . that there’s no dispute regarding the underlying functionality of the samples that Apple made available to us.”). Thus, the disagreement between the parties focuses entirely on the question whether the features of the articles at issue, the operation of which is not in dispute, satisfy the relevant claim limitations such that there is infringement of the ’941 or ’731 patents.

Apple argues that the articles at issue do not infringe the ’941 or ’731 patents because “[t]hese patents require a smartwatch with instructions executable to confirm an arrhythmia with an ECG.” Ruling Request at 14 (citing ’941 patent, cl. 12 (“a computer program including instructions executable by the processor to cause the processor to . . . receive electric signals of the user from the ECG sensor to confirm the presence of the arrhythmia”); ’731 patent, cl. 1 (“memory having instructions stored thereon that, when executed by the processing device, cause the processing device to . . . receive ECG data from the ECG sensor; and confirm the presence of the arrhythmia based on the ECG data”)). Therefore, according to Apple, because the articles at issue “cannot receive ECG signals, cannot analyze those signals, and cannot conclude anything about those signals, much less confirm an arrhythmia using those ECG signals[,]” they cannot infringe.

AliveCor contends in opposition that the articles at issue “still come[] pre-loaded with the same computer executable instructions for ECG that the ITC found infringing [and] still contain[] instructions that when executed would cause the processor to ‘receive’ ECG signals and to ‘confirm’ an arrhythmia using the ECG signals.” AliveCor Response at 3. In AliveCor’s view, the claim language does not require specific operation of the ECG functionality because infringement can be found solely on the presence of executable instructions. Id. at 10. Specifically, AliveCor’s position is that “[t]he redesigned Apple Watch, which contains an ECG sensor, readily satisfies [the] claimed requirements because (1) it contains instructions stored in memory related to operation of the infringing ECG functionalities as claimed, and (2) the instructions are executable by the processor, and that when they are executed, they will cause the processor to carry out precisely those infringing ECG functionalities.” Id.

Much of the parties’ dispute stems from the claim limitations requiring executable instructions. See ’941 patent at claim 12 (“. . . a computer program including instructions executable by the processor to cause the processor to . . . receive electric signals of the user form the ECG sensor to confirm the presence of the arrhythmia.”); ’731 patent at claim 1 (“. . . memory having instructions stored thereon that, when executed by the processing device, cause the processing device to . . . receive ECG data from the ECG sensor; and confirm the presence of the arrythmia based on the ECG data.”) (emphasis added).

To support its position, Apple interprets this claim language as requiring “that the code not just exist but be executed or executable[,]” or, put another way, that the claims require capability of actual performance. See Apple Reply at 11; see also Apple Post-Oral Discussion Submission at 13-14. Apple cites findings from the underlying investigation for the proposition that instructions executable by the processor, as claimed, must cause the processor to receive, analyze, and conclude the presence of an arrythmia. Id. at 13 (citing FID at 43-44). Specifically, Apple emphasizes the Commission’s finding that:

[W]hat is required for this element, as relevant here, is simply a smartwatch with a “non-transitory computer readable storage medium” loaded with instructions “executable by the processor to cause the processor” to receive ECG signals, analyze those signals, and conclude (i.e., confirm) that “the arrhythmia” is present from those signals.

Id. (quoting FID at 43-44) (emphasis added by Apple).

To operate in an infringing manner, Apple argues, would require significant modification to the source code for the articles at issue. See, e.g., Apple Post-Oral Discussion Submission at 29-33.

AliveCor, on the other hand, argues that “[t]he emphasis in the 1266 Investigation was, and always has been, about whether or not the required computer instructions are present on the Apple Devices.” AliveCor Post-Oral Discussion Submission at 1 n.1. According to AliveCor, the “ordinary and customary meaning of ‘executable’ is computer software, a program, or piece of code ‘that can be understood by the operating system of the computer, and [that] makes the computer perform a particular task.’” Id. at 2; see AliveCor Sur-Reply at 3 (quoting https://dictionary.cambridge.org/us/dictionary.english.executable.).

The parties agree that the claims at issue are apparatus claims. See, e.g., Apple Post-Oral Discussion Submission at 6 (“The patents concern smartwatches with ECG functionality, and the ITC found that the pre-redesign Watch infringes the apparatus claims based on the capability of performing that ECG functionality.”); AliveCor Response at 3 n.5 (“The infringed claims are apparatus claims, not method claims[.]”). Additionally, neither party thinks the EOE Branch must decide between whether the claims at issue require actual performance or capability. Instead, they argue for their respective positions from the perspective that only capability of performance needs to be considered. See, e.g., Oral Discussion Transcript at 30: 1-4 (Apple: “This is a capability claim at a minimum. Now, there’s [sic] arguments in light of the ID that it’s actually an actual performance claim, but we don’t need to go there.”); AliveCor Post-Oral Discussion Submission at 5 n.8 (“Although AliveCor disagrees that the claims at issue need to be categorized into either bucket based on their plain language, even under the less-stringent ‘capability’ bucket, AliveCor has amply demonstrated that Apple infringes.”). Based on that mutual understanding, the analysis will proceed with the view that the relevant claims are directed to capability.

* * *

As noted above, with respect to infringement of a claim drawn to capability, “case law supports finding infringement by a ‘reasonably capable’ accused device on a case-by-case basis particularly where [] there is evidence that the accused device is actually used in an infringing manner and can be so used without significant alterations.” Ericsson, Inc. v. D-Link Sys., 733 F.3d 1201, 1217 (Fed. Cir. 2014) (emphasis in original). “In contexts involving software functionality, [the Federal Circuit has] never suggested that reasonable capability can be established without any evidence or undisputed knowledge of an instance that the accused product performs the claimed function when placed in operation.” INVT, 46 F.4th at 1376. The Federal Circuit has found such evidence or undisputed knowledge of performance in various instances.

For example, in Ericsson, a capability claim limitation was met because of a finding of the accused device’s capability to perform the function “some of the time” based on “proof that it was in fact so used by some device users.” Ericsson, Inc. v. D-Link Sys., Inc., 773 F.3d 1201, 1216 (Fed. Cir. 2014). Similar support underlies infringement in Versata, Finjan, ParkerVision, and Fantasy Sports Properties, as additional examples. See Versata Software, Inc. v. SAP Am., Inc., 717 F.3d 1255, 1263 (Fed. Cir. 2013) (noting that customers did and were expected to perform the functionality); Finjan, 626 F.3d 1203 (“Defendants argue that infringement occurred only when customers purchased keys and unlocked proactive scanning modules . . . .” (emphasis added)); ParkerVision, 903 F.3d 1360 (Fed. Cir. 2018) (noting, in the invalidity context that “it is undisputed that [the reference] Nozawa’s device necessarily will produce a periodic signal that contains integer multiples of the fundamental frequency under some, albeit not all, conditions” (emphases added)); Fantasy Sports Props., Inc. v. Sportsline.com, Inc., 287 F.3d 1108, 1119 (treating the claim as drawn to software with the “ability” to award a particular type of bonus points and finding a need for further factfinding regarding evidence of such bonus point awarding being performed without modification).

Id.

Thus, evidence that the articles at issue perform the claimed function at least once is crucial to show that they are reasonably capable of satisfying the claim limitations for infringement of apparatus claim at issue here that is drawn to capability. INVT at 1377 (“Because we require claim limitations to have some teeth and meaning, proof of reasonable capability of performing claimed functions requires, at least as a general matter, proof that an accused product—when put into operation—in fact [will] execute[] all of the claimed functions at least some of the time or at least once in the claim-required environment.”); id. at 1380 (“An accused device cannot meet the required capabilities . . . without evidence or agreement that the accused device performs, without modification, the recited functions at least once when it is in operation.”).

AliveCor argues that, “[t]o the extent that proof is required that Apple’s WatchOS code ‘in fact executes all of the claimed functions’ as specified in INVT (46 F.4th at 1377), AliveCor has indisputably already made this showing in connection with the Apple Watches at issue in the 1266 Investigation.” AliveCor Sur-Reply at 8; see AliveCor Post-Oral Discussion Submission at 5 (“The undisputed evidence before the Branch shows that all redesigned Apple Watch articles come preloaded with the same (or substantively identical) executable ECG instructions, stored in memory, that when executed will cause the processor of the Apple Watch to perform all claimed ECG functionalities exactly like the Watch found to infringe by the ITC.”) (internal citations omitted). Notwithstanding that view, AliveCor has not provided any evidence to show, as a factual matter, that in their present condition described above, the articles at issue are designed in such a way as to enable a user to actually perform the [[ ]] claimed in the asserted patents or could be so used without significant alterations. See, e.g., Apple Post-Oral Discussion Submission at 26 (“There is no evidence of even a single instance of the redesigned Watch operating with [[ ]].”); Oral Discussion Transcript at 94:22-95:8 (AliveCor: “The Branch can look no further than the precise code that was analyzed with respect to the underlying investigation. . . . [W]hile this particular article in its present state while it remains in this locked state can’t be tricked into doing so. [sic] It retains that functionality, and the evidence is there that when that code is executed, it will, in fact, execute in accordance with the claims.”).

Thus, AliveCor’s position is that although the articles at issue cannot presently operate in the infringing manner, they nevertheless contain the executable ECG instructions necessary to perform that function if activated and, for this reason, there is infringement. See, e.g., AliveCor Post-Oral Discussion Submission at 4; AliveCor Response at 14. Specifically, AliveCor argues that “unlike Fantasy Sports, Versata, and Telemac Cellular, the executable ECG instructions that were already held to be infringing are pre-stored in memory for every shipped redesigned Apple Watch, and no modification of the articles is required by the user (or by Apple) to specifically store those instructions in memory, so as to create the infringing smartwatch.” Id. (emphasis added). That no modification by a user or Apple is necessary to “store” instructions in memory is factually different from and, based on the Federal Circuit’s case law, of less legal significance to the question whether modification is necessary to perform the ECG functionality such that the articles at issue would be considered “reasonably capable” of satisfying the relevant claim limitations.

As discussed above, “[w]hether infringement requires actual performance of the recited function by the accused device depends on the claim language.” INVT, 46 F.4th at 1371. Even if the claim language in question does not require actual performance, as both parties frame their arguments regarding the limitations at issue, to satisfy the claim limitations, the articles at issue must be reasonably capable of operating in an infringing manner, namely, having executable instructions that cause the processor to perform the ECG functionality. See ’941 patent at 17:52-18:19; ’731 patent at 26:27-46. The articles at issue, however, do not have executable instructions that cause a processor to perform ECG functionality, as the [[ ]]. See, e.g., Ruling Request at 11; AliveCor Sur-Reply at 3 n.2 (“AliveCor does not dispute . . . that the redesigned Apple Watch samples provided for inspection . . . make use of Apple’s [[ ]].”). Without an instance of operation causing the processor to perform ECG functionality, the articles at issue cannot be considered reasonably capable of satisfying the ECG functionality limitations. See INVT, 46 F.4th at 1376.

AliveCor cites Finjan for, inter alia, the proposition that “attempting to lock-out or disable an otherwise infringing feature—depending on the claim requirements—is not enough to avoid infringement.” AliveCor Sur-Reply at 9; see AliveCor Post-Oral Discussion Submission at 7. In Finjan, presence of the infringing programming was enough to establish infringement without the software being “active” or “enabled.” Finjan, 626 F.3d at 1205. In Finjan, however, the Federal Circuit also found evidence of the article’s capability to perform the infringing functionality. Id. at 1203 (“Defendants argue that infringement occurred only when customers purchased keys and unlocked proactive scanning modules[.]”) (emphasis added). Thus, even if the infringing functionality is present, yet blocked in some manner, there must be evidence or undisputed knowledge of an instance of infringing performance. See INVT, 46 F.4th at 1376 (“In contexts involving software functionality, we have never suggested that reasonable capability can be established without any evidence or undisputed knowledge of an instance that the accused product performs the claimed function when placed in operation.”).

“Relatedly, [the Federal Circuit has] rejected finding infringement based on an accused product being ‘merely capable of being modified in a manner that infringes.’” Id. (quoting Fantasy Sports, 287 F.3d at 1117-18 (citing High Tech Med. Instrumentation, Inc. v. New Image Indus., Inc., 49 F.3d 1551, 1555-56 (Fed. Cir. 1995)) (emphasis added); and then citing Telemac Cellular Corp. v. Topp Telecom, Inc., 247 F.3d 1316, 1330 (Fed. Cir. 2001); and discussing Intel Corp. v. U.S. Int'l Trade Comm’n, 946 F.2d 821 (Fed. Cir. 1991))). AliveCor argues that Apple “leaves the infringing ECG software functionality in a dormant state in WatchOS. Apple can thus choose to easily wake the feature at any time, such as by an over-the-air software update to WatchOS[.]” AliveCor Response at 2. AliveCor therefore has acknowledged that, for the articles at issue to perform the infringing ECG functionality, such functionality must be reactivated by Apple. Id. at 2, 3.

“[T]hat a device is capable of being modified to operate in an infringing manner is not sufficient, by itself, to support a finding of infringement.” Telemac, 247 F.3d at 1330 (citing High Tech Med., 49 F.3d at 1556); see INVT, 46 F.4th at 1374 (“. . . the claims recite a device with the capability of performing the recited functions when in operation without any modification or further programming.”) (emphasis added); see also Ericsson, 773 F.3d at 1217 (“We therefore find that the jury could properly base its infringement finding on the reasonable capability of the unmodified accused devices.”) (emphasis added); Versata Software, 717 F.3d at 1261 (“Portions of the record clearly support the jury’s conclusion that SAP’s accused products infringe the asserted claims without modification or additional computer instructions.”) (emphasis added); Finjan, 626 F.3d at 1205 (“There is no evidence that customers needed to modify the underlying code to unlock any software modules.”). Because the articles at issue require further modification—in the form of a software update—they are, as addressed in this ruling, found to be non-infringing.

Sufficiency of the Evidence

According to AliveCor, Apple has failed to meet its evidentiary burden to show that the articles at issue are not subject to the 1266 LEO. See, e.g., AliveCor Response at 14. Specifically, AliveCor argues that the articles are not fixed and finalized, and Apple has not sufficiently proven that the “Apple iPhone (a necessary companion to any Apple Watch) is not required to effectuate the [[ ]] aspect of the alleged redesign.” Id.

As an initial point, the EOE Branch does not find the functionality of the Apple iPhone as a necessary consideration for this ruling request. The patents at issue, the scope of the underlying investigation, and the corresponding remedial orders are generally directed to wearable electronic devices with ECG functionality. See, e.g., FID at 1. Furthermore, AliveCor did not accuse the Apple iPhone of infringing the patents at issue during the 1266 investigation. Id. at 5-6. Thus, the EOE Branch does not agree that the provision of the Apple iPhone source code is necessary to overcome Apple’s burden in this ruling in light of the language of the claim limitations and the nature of the redesign and functionality under consideration.

AliveCor argues that “[t]he WatchOS source code produced by Apple in these proceedings, as well as the circumstances surrounding such production, strongly suggests that the relevant version of WatchOS 9 containing the redesign functionality[] has not been deployed in a public version of the operating system and is more likely a developmental version of the code.” AliveCor Response at 15. According to AliveCor, the WatchOS that was inspected “depart[s] significantly from the structure and organization of prior-generations [sic] of WatchOS code for this package.” Id. Further, AliveCor’s expert “is of the opinion that the final-produced code may actually correspond to a non-final version of WatchOS code, such as a ‘tester’ version of code that was compiled only for purposes of these Section 177 proceedings, and which was loaded onto the sample redesign watched produced for inspection.” Id. (citing Jafari Declaration at ¶¶ 53-55). Additionally, since “Apple has not placed the source code for the redesigned Watches into the publicly deployed version of WatchOS,” AliveCor Sur-Reply at 10 (citing Thomas Reply Declaration at ¶¶ 13-14), “further modification would be necessary to transform the code into the ‘final’ deployable version that is ready for public Implementation,” id. (citing Jafari Reply Declaration at ¶¶ 24-31), and the redesigned software is not “‘fixed,’ since it was implemented in an already-outdated version of the WatchOS.” Id. (citing Jafari Reply Declaration at ¶ 28).

A request for an administrative ruling must include a complete statement of all relevant facts relating to the transaction contemplated by the request, and no ruling letter will be issued with respect to transactions or questions that are essentially hypothetical. 19 C.F.R. § 177.2(b)(1); 177.7(a). Apple’s Ruling Request is not essentially hypothetical, and the articles at issue are sufficiently fixed and final. The question presented in this ruling request is whether the articles at issue are subject to the exclusion order issued in the 1266 investigation due to infringement of the patents at issue. As part of its request, Apple provided samples of articles at issue and an opportunity for AliveCor’s ability to evaluate and argue its position as to infringe any of the asserted claims in the 1266 LEO. The administrative record does not suggest that these articles are not sufficiently finalized for evaluation or that Apple is still contemplating fabrication of the articles at issue. The fact that the software is structured or organized differently from the legacy articles found to infringe does not suggest that the software is in some way hypothetical. Because the request for a ruling under 19 C.F.R. Part 177 is prospective in nature, there is no requirement for an article to be “publicly deployed,” as suggested by AliveCor. See 19 C.F.R. § 177.1(a)(1). Any indication that the article at issue is a “tester” version of the code, fabricated for the purposes of this inter partes proceeding, rather than for commercial use, has not been concretely established.

Moreover, a finding with respect to the articles at issue – specifically, that they implement the redesigned functionality addressed above and are not subject to the exclusion order on that basis – applies only to future articles that do not materially differ from those at issue in this ruling. See 19 C.F.R. § 177.9(b)(1) (“The application of a ruling letter by a Customs Service field office to the transaction to which it is purported to relate is subject to the verification of the facts incorporated in the ruling letter, a comparison of the transaction described therein to the actual transaction, and the satisfaction of any conditions on which the ruling was based.”). Thus, to the extent future articles seeking entry are materially different from those at issue in this ruling because they do not have the same functionality or include new functionality that is relevant to the asserted claims in the exclusion order, this ruling would not cover such articles and the burden to establish admissibility under section 337 would apply. See CBP Headquarters Ruling H324813 (dated June 3, 2022) at 37. As the EOE Branch stated in that ruling:

The burden to show, as a factual matter, continued implementation of the redesigns is on [the respondent or importer] and, if the administrative record reveals new or modified functionality not present in the adjudicated redesigns that is material for purposes of the asserted patent claims, it is at that point when a respondent [or importer] . . . would need to establish non-infringement for its new products incorporating these unadjudicated features.

Id.

The Certification

Despite this ruling’s finding that modification would be required for the articles at issue to infringe, the EOE Branch recognizes the concern regarding the potential for such modification. See, e.g., Oral Discussion Transcript at 48:10-12 (Apple: “Apple could modify things in the future with new software downloaded, that a consumer could download[.]”). Although this ruling turns on whether the articles at issue, in their present condition as described above, are reasonably capable of satisfying the relevant claim limitations, their acute ability for post-importation modification leads the EOE Branch to the view that a certification, pursuant to paragraph 5 of the 1266 LEO, is warranted should the Commission lift suspension on enforcement of the limited exclusion order.

In the 1266 LEO, the Commission directed that “[a]t the discretion of CBP and pursuant to procedures that it establishes, persons seeking to import articles that are potentially subject to this Order may be required to certify that they are familiar with the terms of this Order, that they have made appropriate inquiry, and thereupon state that, to the best of their knowledge and belief, the products being imported are not excluded from entry under paragraph 1 of this Order. At its discretion, CBP may require persons who have provided the certification described in this paragraph to furnish such records or analyses as are necessary to substantiate the certification.” 1266 LEO at 3, ¶ 5. Additionally, the Commission noted in the underlying investigation that a certification is primarily for use after the Commission or CBP has determined that certain articles do not infringe. Comm’n Op. at 50 (citing Automated Teller Machines, ATM Modules, Components Thereof, & Prods. Containing the Same, Inv. No. 337-TA-972, EDIS Doc. ID 613988, Commission Opinion (Public) (June 12, 2017) at 27 (“The standard certification language does not apply to redesigns that have not been adjudicated as non-infringing.”)); see CBP Headquarters Ruling H323308 (dated February 8, 2022) at 15 n.6 (“A favorable ruling under 19 C.F.R. Part 177 may provide a basis for using a certification[.] . . . [T]he use of certifications is primarily when the articles in question ‘have been previously determined by CBP or the Commission not to violate the exclusion order.’”) (quoting Certain Network Devices, Related Software and Components Thereof (I), Inv. No. 337-TA-944, EDIS Doc. ID 586600, Commission Opinion (Public) (June 26, 2016) at 53 n.19).

Moreover, in appropriate circumstances, the EOE Branch has conditioned an importer’s ability to enter for consumption into the United States the article at issue according to a ruling under 19 C.F.R. Part 177 that resulted from an inter partes proceeding. See CBP Headquarters Ruling H324813 (dated June 3, 2022) at 47 (“Thus, it is CBP’s position that the articles at issue are subject to exclusion from entry for consumption based on the 1191 LEO until Google: (1) disables or renders inoperable the Device Utility app such that it can no longer be used with the articles at issue and provide notice of this action or (2) establishes non-infringement for the articles at issue pursuant to an ancillary proceeding at the Commission or an inter partes proceeding requested from CBP under 19 C.F.R. Part 177 that addresses operation of the Device Utility app on the articles at issue.”). Additionally, in certain cases, the Intellectual Property Rights Branch (the predecessor to the EOE Branch) treated the filing of a certification as a condition for entry following a favorable ruling under 19 C.F.R. Part 177. See CBP Headquarters Ruling H282234 (dated May 16, 2017) at 9 (“Because there is currently no simple method to test whether a particular GFCI utilizes three electrically isolated conductors without disassembling the GFCI, we are requiring that Royal Pacific Corporation file a certification upon ENTRY (along with any other required entry documents) for any imported GFCIs certifying that said merchandize does not utilize three electrically isolated conductors and thus does not satisfy the independent claim limitations of the ’809 patent.”); see also CBP Headquarters Ruling H311351 (dated August 19, 2020) at 29 (“In addition, with each entry of the articles at issue, CBP will require from persons importing the articles at issue (1) a certification, as approved by CBP; and (2) upon request by CBP, to furnish such records or analyses necessary to substantiate the certification.”) (internal citation omitted). Based on the concerns raised by the potential to modify the articles at issue post-importation, we find that the use of a certification as a condition of entry is appropriate.

Moreover, while AliveCor is on notice, as provided in this ruling, regarding the use of a certification if the Commission lifts suspension on the exclusion order’s enforcement, the EOE Branch considers it appropriate that AliveCor have an opportunity to participate in the drafting process for the proposed certification, with specific procedures established when and if the Commission lifts the suspension. While there is no statutory or regulatory requirement that AliveCor be apprised as to the drafting or use of a certification, the EOE Branch may, in its discretion, provide for such participation and has decided to exercise that discretion in this case. See CBP Headquarters Ruling H326291 at 2 n.2 (dated August 5, 2022) (“[U]nless the EOE Branch expressly indicates otherwise, individual communications during an inter partes proceeding are prohibited only to the point that the EOE Branch issues its ruling on the question presented in a request. Therefore, as a general matter, once a ruling has issued and the question presented by the ruling request is answered, the inter partes proceeding will conclude and individual communications may resume. For example, after a ruling issues, the certification a party may propose to use in connection with its future importations is not automatically required to be shared with the other interested party, unless the EOE Branch expressly indicates otherwise.”).

V. HOLDING

We find that Apple has met its burden to establish that the articles at issue do not infringe any of claims 12, 13, and 19-23 of the ’941 patent or claims 1, 3, 5, 8-10, 12, 15, and 16 the ’731 patent. Accordingly, we find that the articles at issue are not subject to the LEO issued as result of Investigation No. 337-TA-1266. Entry for consumption into the United States, entry for consumption from a foreign trade zone, or withdrawal from a warehouse for consumption of the articles at issue, however, is conditioned on the drafting and submission of a certification, as provided for in this ruling, that would take effect should the Commission lift the suspension on enforcement of the limited exclusion order.

The decision is limited to the specific facts set forth herein. If articles differ in any material way from the articles at issue described above, or if future importations vary from the facts stipulated to herein, this decision shall not be binding on CBP as provided for in 19 C.F.R. §§ 177.2(b)(1), (2), (4), and 177.9(b)(1) and (2).

Sincerely,

Dax Terrill
Chief, Exclusion Order Enforcement Branch

CC: S. Alex Lasher
Quinn Emanuel
1300 I Street NW, Suite 900
Washington, D.C. 20005
[email protected]