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ITC Bans Imports of Samsung Devices; White House Has 60 Days to Review

Wednesday, August 14, 2013
Sandler, Travis & Rosenberg Trade Report

The International Trade Commission announced Aug. 9 that it will ban imports of certain older model Samsung smartphones and tablets for patent infringement. The decision represents the second victory in a week for Apple against Samsung, which saw its bid to block imports of certain Apple smartphones and tablets overturned by the White House. A similar reversal is thought to be less likely in this case.

In investigation 337-TA-796, the ITC found that the importation, sale for importation and sale within the U.S. after importation of certain electronic digital media devices and components thereof (specifically, mobile phones, media players and tablet computers) by Samsung are violating Section 337 of the 1930 Tariff Act by reason of infringement of two patents owned by Apple concerning multitouch recognition and headphone jack detection. According to press reports, the ITC rejected claims of infringement of four additional patents.

The ITC has issued a limited exclusion order prohibiting Samsung from importing the infringing devices as well as cease and desist orders prohibiting Samsung from further importing, selling and distributing such products. These orders do not apply to the design around products found not to infringe the asserted patent claims. Items subject to these orders may still be imported and sold in the U.S. during the 60-day presidential review period (i.e., through Oct. 8) with the posting of a bond in the amount of 1.25% of the entered value.

There are conflicting opinions on whether U.S. Trade Representative Mike Froman may overturn the ITC’s import ban in this case as he did with respect to smartphones and tablets imported by Apple that had been found to infringe patents owned by Samsung. On the one hand, the patents at issue in this case are not “standards essential” (i.e., necessary to comply with established industry standards for the product) and upholding them will therefore have less of an impact on consumers. On the other hand, the White House may want to again overrule the ITC in an effort to drive the two tech giants to negotiate a settlement as well as avoid the appearance of favoring a U.S. company.

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