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In two previous posts (here and here) I discussed the patent infringement case between hybrid drivetrain technology company Paice LLC (Paice) and Toyota in the U.S. International Trade Commission (ITC).
In September of last year, Paice filed a complaint in the ITC asking the agency to investigate whether Toyota’s importation of the third generation Prius, the Camry hybrid and two Lexus models (Accused Products) infringed U.S. Patent No. 5,343,970 (‘970 Patent).
AfterÃÂ the ITC agreed to open an investigation, Paice moved for summary determination of infringement, validity and enforceability of the ‘970 Patent.ÃÂ
Specifically, Paice contended that Toyota was barred from asserting a defense of non-infringement of the ‘970 patent and from challenging the validity or enforceability of the ‘970 patent under theÃÂ principles ofÃÂ claim preclusion and issue preclusion because of a prior federal district court and appeals court ruling against Toyota.
In aÃÂ issued in December and made public earlier this month, the ITC staff agreed with Paice andÃÂ supported its motion.ÃÂ ÃÂ The response noted that, although theÃÂ Accused Products are different from those at issue inÃÂ the federal court case,ÃÂ Toyota admitted that the hybrid drivetrains are materially the same as the vehicles found to infringe in that lawsuit.
Compounding Toyota’s troubles was a last week in the same case in which the ITC staff opposed the automaker’s cross-motion for summary judgment that claim preclusion should bar Paice from obtaining any remedy in the investigation.ÃÂ
The response rejected Toyota’s argument because claim preclusion applies only to the cause of action and does notÃÂ include theÃÂ ensuing remedies.
Assuming the administrative law judge follows the recommendations of the ITC staff, the only remaining issue would be whether Paice meets the “domestic industry” requirement.ÃÂ
19 U.S.C. 1337 requires that there be an industry in the U.S. relating to the products at issue, whichÃÂ includes both an economic prong (demonstrated investment in plant/equipment, labor/capital, research and development or licensing) and a technical prong (demonstrated practice of the asserted intellectual property right).
Now the big question is whether Toyota will continue to fight or decide to fold and pay royalties to Paice.ÃÂ If the case moves forward, it will be interesting to see whether the ITC finds Paice’s engineering, R&D and licensing activities in the U.S. suffice to meet the domestic industryÃÂ requirement.
Considering what is at stake in this case – Paice has requested a permanent exclusion order barring entry into the U.S. of the Prius, Camry hybrid and the two accused Lexus models – I wonder if and when the mainstream media will start to pay attention.