Updated 10:15 a.m
Companies are increasingly filing patent infringement cases before the International Trade Commission instead of the federal courts, because it is easier to get an order stopping the infringement at the ITC, Department of Justice and Federal Trade Commission officials told Congress this week.
"I can’t speak to the motivations of all the parties for seeking relief from the ITC, but we are concerned that that is happening," Joseph Wayland, acting assistant attorney general in DOJ's Antitrust Division, told the Senate Judiciary Committee on Wednesday.
Companies are responding to the Supreme Court's 2006 ruling in eBay Inc. v. MercExchange, which found companies can get monetary relief by proving infringement but now must satisfy a four-factor judicial test for injunctive relief, Wayland said.
"We're concerned that they are seeking to get a remedy outside of the federal courts, that the Supreme Court has recognized ought to be limited by the traditional limits on injunctive relief," Wayland said.
There is a different standard before the ITC, where companies can forego monetary relief and not have to go through the judicial test to stop competitors from moving infringing products, FTC Commissioner Edith Ramirez told the committee.
"There is an expectation that once there's a finding of patent infringement, that an exclusion order would, almost in all circumstances, issue," Ramirez said of the ITC. That would send an order to U.S. Customs and Border Protection agency to stop infringing products from entering the country.
Ramirez agreed with Sen. Patrick Leahy, who said at the hearing that he has heard that companies are increasingly avoiding federal court cases and going to the ITC instead.
Leahy asked about the issue during a hearing about how exclusion orders that enforce standard essential patents affect competition.
"When inventors and developers are willing to license their technologies to one another at reasonable rates, the cross-fertilization of ideas benefits us all," Leahy said in a statement at the hearing. "But I am concerned that the recent trend of seeking exclusion orders from the International Trade Commission, rather than negotiating and seeking license fees, may have the opposite effect."