Federal Circuit Expands Its Appellate Overview in ITC Cases Involving Arbitration

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In a closely watched decision, the U.S. Court of Appeals for the Federal Circuit recently determined that an order of the International Trade Commission ("ITC") terminating an investigation on the basis of an arbitration agreement is an appealable final determination under 19 U.S.C. § 1337(c). As a result of this case, the federal circuit now has jurisdiction over appeals based on determinations of the ITC to terminate investigations due to pre-existing arbitration agreements.

The case, InterDigital Communications, LLC v. Int'l Trade Comm'n, Case No. 2012-1628 (Fed. Cir., June 7, 2013), stems from a complaint, filed by InterDigital Communications against LG and other defendants, for patent infringement arising out of the importation of wireless 2G and 3G products. LG's defense was that the allegedly protected products were covered by a license agreement that required arbitration. After an administrative judge sent the case to an arbitrator, the ITC determined that it would not review the finding and terminated the investigation as to LG.

InterDigital appealed, and the federal circuit considered whether had jurisdiction to hear the appeal. In deciding that it did, in fact, have jurisdiction, the federal circuit took a broad view of its powers to hear appeals of § 337 investigations. The court determined that it had the power to hear appeals of ITC orders even when there is no final determination on the merits, but only when the "effect upon appellants is the equivalent of a final determination." By giving itself broader jurisdiction over the appeal of ITC cases, particularly when they are not yet final on the merits, the federal circuit now has even greater oversight over patent infringement cases, especially where there is an existing arbitration agreement.

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