ITC & Imports
For device companies that manufacture abroad and sell into the United States, the U.S. International Trade Commission is both a risk to understand and, in some circumstances, a tool. Section 337 of the Tariff Act of 1930, codified at 19 U.S.C. §1337, makes unlawful the importation into the United States, the sale for importation, or the sale within the United States after importation of articles that infringe a valid and enforceable U.S. patent. The ITC does not award damages, although it can impose civil penalties for violations of its cease and desist orders. What it can do is order that infringing products be stopped at the border.
The Commission's principal remedy is an exclusion order directing that infringing articles be excluded from entry into the United States. A limited exclusion order reaches infringing products of the respondents named in the investigation. A general exclusion order reaches infringing products regardless of who imports them, and the statute permits one only where it is necessary to prevent circumvention of a limited order, or where there is a pattern of violation and it is difficult to identify the source of infringing products.
The Commission may also issue cease and desist orders under section 337(f). These can reach conduct an exclusion order does not, such as the sale of infringing inventory already imported into the United States. The statute also authorizes temporary exclusion orders while an investigation is pending, with entry permitted under bond.
Exclusion orders are enforced at the border by U.S. Customs and Border Protection. A respondent that redesigns its product may seek a determination that the redesign falls outside the order, either from the Commission or through a ruling from CBP. Until one of those determinations is made, the importer bears a real risk that CBP will exclude the redesigned product at entry, so a ruling is usually obtained before shipments resume.
Section 337 directs the Commission to conclude investigations at the earliest practicable time and to establish a target date for its final determination within 45 days after an investigation is initiated. Practitioner overviews describe investigations as typically taking about 15 to 18 months from institution to a final Commission determination, with the evidentiary hearing generally held nine to twelve months after institution. Individual timelines vary, and settlements and early terminations can shorten them considerably. That pace is generally faster than the time to trial in district court. For a respondent whose engineering records and witnesses are abroad, defending on that schedule is a substantial undertaking.
Before excluding articles, the Commission must consider the effect of exclusion on the public health and welfare, competitive conditions in the U.S. economy, the production of like or directly competitive articles in the United States, and U.S. consumers. It may decline to exclude if, after considering those factors, it finds the articles should not be excluded.
For medical devices, the public health and welfare factor carries evident weight. Patients and clinicians may rely on a particular device, and the patent owner may not be positioned to supply the market in the near term. The Commission has nonetheless rarely denied relief on public interest grounds. One of the few investigations in which it did so, Certain Fluidized Supporting Apparatus (Inv. Nos. 337-TA-182/188, 1984), involved specialized hospital beds for burn patients where the domestic producer could not supply beds within a commercially reasonable time. More often, the Commission has addressed public interest concerns by tailoring a remedy — for example, exempting existing inventory or delaying when an order takes effect — rather than withholding it.
A complainant must file a public interest statement with its complaint, and respondents and the public may comment. In a device investigation, both sides should expect that record to be developed deliberately.
A Commission finding of violation does not become final immediately. The statute provides a 60-day period during which the President may disapprove the determination for policy reasons. A 2005 presidential memorandum assigned that function to the U.S. Trade Representative, which has exercised it since. During the review period, the respondent may continue importing under a bond set by the Commission. In a widely followed example involving patents owned by Masimo Corporation and Cercacor Laboratories asserted against Apple, the Trade Representative decided not to reverse the Commission's determination, and it became final on December 26, 2023.
Section 337 is a trade statute, and a patent owner may invoke it only if an industry in the United States relating to the articles protected by the patent exists or is in the process of being established. Under section 337(a)(3), such an industry exists if there is in the United States, with respect to the protected articles, significant investment in plant and equipment; significant employment of labor or capital; or substantial investment in exploitation of the patent, including engineering, research and development, or licensing. For patents, the Commission looks both at whether the domestic products practice the patent, often called the technical prong, and at whether the U.S. investments are sufficient, often called the economic prong.
The statutory test looks to investment and activity in the United States; it does not require that the patent owner be a U.S. company. A company headquartered and manufacturing abroad may therefore be a complainant if the necessary U.S. activity exists. In Lashify, Inc. v. International Trade Commission, decided March 5, 2025, the U.S. Court of Appeals for the Federal Circuit held that there is no carveout from significant employment of labor or capital for sales, marketing, warehousing, quality control, or distribution. The complainant in that case manufactured abroad, and the decision broadened the U.S. investment that may count for companies whose domestic footprint is commercial. Whether a given level of investment is significant remains a fact-specific question.
For a device company that manufactures outside the United States, several points follow.
On the defensive side, a competitor's U.S. patents can be enforced against imports on a faster schedule than many district court actions, with a remedy that stops shipments rather than one that awards damages. Freedom-to-operate review before a U.S. launch, and before changes in contract manufacturers, component suppliers, or supply routes, becomes correspondingly more important. Because a redesigned product cannot be imported until it is cleared, design-around options are most useful when they are identified, documented, and fixed in design early.
On the offensive side, a foreign company's own U.S. patents may support a Section 337 complaint if it has, or is establishing, a qualifying domestic industry. It is worth mapping the company's U.S. engineering, research and development, sales, marketing, warehousing, quality control, distribution, and licensing activities against specific patents, and keeping records that tie those investments to the products that practice each patent.
Claim coverage should be tested against both sides of the case. A complainant must show, for each asserted patent, that the articles on which its domestic industry rests, which may include a licensee's products, practice at least one claim, and infringement is assessed against the imported article. Claims that read on the company's own commercial device as well as on the competing products it would realistically need to exclude are the ones that carry weight in this forum.
Public interest facts should be considered early. How an exclusion order would affect patients and providers, what alternatives exist, and whether supply could meet demand all bear on the Commission's analysis.
Section 337 is not the right forum for every dispute, and its procedural demands are considerable. For device companies whose products cross a border before reaching U.S. patients, however, it belongs in the portfolio strategy discussion from the outset. Companies manufacturing abroad may find it useful to review with patent counsel both their exposure at the ITC and whether their own U.S. patents and U.S. activities would support a complaint. This article provides general information and is not advice on any specific situation.