U.S. International Trade Commission; General Exclusion Order; Investigation No. 337-TA-545; Certain Laminated Floor Panels

HQ H101335 May 21, 2013 OT:RR:BSTC:IPR H101335 DAX CATEGORY: 19 U.S.C. § 1337; Unfair Competition Charles F. Schill Steptoe & Johnson LLP 1330 Connecticut Avenue, N.W. Washington, D.C. 20036-1795 RE: U.S. International Trade Commission; General Exclusion Order; Investigation No. 337-TA-545; Certain Laminated Floor Panels Dear Mr. Schill: This is in response to your letter, dated April 9, 2010, as supplemented on June 22, 2010, December 21, 2010, September 21, 2011, and December 14, 2011, in which you requested on behalf of your client, Yekalon Industry, Inc. (“Yekalon”), a determination whether certain of Yekalon’s laminated floor panels are subject to the above-referenced general exclusion order (“545 GEO”) issued by the U.S. International Trade Commission (“ITC” or “Commission”). The information in brackets is confidential and will be omitted from the public version. FACTS: Yekalon is a company organized and existing under the laws of China, having its principal place of business located at Suite 16A, Flat A, Jinxiu Building, Wenjin Middle Road, Shenzhen, Guangdong 518003 China. See In the Matter of Certain Laminated Floor Panels, Investigation No. 337-TA-545, Administrative Law Judge’s Final Initial and Recommended Determinations, (July 3, 2006) (“ALJ Decision”) at 179. Yekalon manufactures laminated floor panels in China and sells them for importation into the United States. Id. Yekalon specifically seeks a determination whether its laminated floor panels with the product designation “Tap & Go” are covered by any of the patents listed in the 545 GEO. The above-referenced ITC investigation was instituted based on a complaint filed by Unilin Beheer B.V. of the Netherlands, Flooring Industries Ldt. of Ireland, and Unilin Flooring N.C. LLC of Thomasville, North Carolina (“Complainant”), which initially named thirty parties, including Yekalon, as respondents. See ALJ Decision at 1-3. The ITC instituted the investigation to determine whether there was a violation of subsection (a)(1)(B) of section 337, as amended, 19 U.S.C. § 1337, in the importation into the United States, the sale for importation into the United States, or the sale within the United States after importation of certain laminated floor products by reason of infringement of one or more of claims 1, 14, 17, 19, 20, 21, 37, 52, 65, and 66 of U.S. Patent No. 6,006,486; claims 1, 2, 10, 13, 18, 19, 22, 23, 24, and 27 of U.S. Patent No. 6,490,836; and claims 1-6 of U.S. Patent No. 6,874,292. Id. The complaint was subsequently amended to add certain respondents to the investigation and to assert claims 1, 5, 13, 17, 27, and 28 of U.S. Patent No. 6,928,779 against certain accused panels. Id. The presiding Administrative Law Judge (“ALJ”) issued a final initial determination on July 3, 2006, finding a violation of section 337, as amended, which the Commission affirmed in part and reversed in part. See In the Matter of Certain Laminated Floor Panels, Investigation No. 337-TA-545, Commission Opinion, (January 5, 2007) (“Commission Opinion”) at 1. Ultimately, the ITC provided relief in the form of a general exclusion order that bars the entry for consumption into the United States of laminated floor panels covered by one or more of claims 1, 2, 10, 18, and 23 of U.S. Patent No. 6,490,836 (“the `836 patent”), claims 3 and 4 of U.S. Patent No. 6,874,292 (“the `292 patent”), and claims 5 and 17 of U.S. Patent No. 6,928,779 (“the `779 patent”). See 545 General Exclusion Order (January 5, 2007); see also ITC Notice, 72 Fed. Reg. 1241-42 (January 10, 2007). Certain parties, but not Yekalon, appealed aspects of the ITC’s determination, which the Court of Appeals for the Federal Circuit (“Federal Circuit”) affirmed. See Yingbin-Nature (Guangdong) Wood Indus. Co. v. U.S. Int’l Trade Comm’n, 535 F.3d 1322 (Fed. Cir. 2008) During the investigation at the ITC, Complainant, inter alia, accused various Yekalon profiles of infringing certain claims of the above-referenced patents, as indicated in the chart below that Complainant provided to the ALJ. See ALJ Decision at 76-77.

 As can been seen above, the Yekalon profiles accused at the ITC generally fall into two categories: (1) the profiles accused of infringing five claims of the `836 patent (claims 1, 2, 10, 18, and 23), two claims of the `292 patent (claims 3 and 4), and two claims of the `779 patent (claims 5 and 17); and (2) the profiles only accused of infringing claim 1 of the `836 patent and claims 3 and 4 of the `292 patent. The first category included the following Yekalon profiles, all of which were ultimately found to infringe: the Double Click 8.2m and 12.3mm, the Big Click 12.3mm, and the Modified Round 8.2mm and 12.3mm. The second category, however, only included the various Engagement profiles (e.g., Engagement 1 (12mm), Engagement 2 (8mm)). Significantly, the ALJ found that the Engagement profiles did not infringe any of the patents asserted against them. See ALJ Decision at 89-94. Moreover, the ALJ’s non-infringement finding as to these profiles was not modified by the Commission during its review of other portions of the ALJ’s final determination. See Commission Opinion at 9, FN 6 (“The ALJ independently found that the Engagement Products of respondent Yekalon do not infringe any of the asserted claims. ID 89-94. We determined not to review that conclusion.”); Id. at 30 (“Non-infringing products, such as Yekalon’s Engagement Products, can be certified as non-infringing, and be allowed entry.”). To establish non-infringement before the ALJ, Yekalon argued that the Engagement profiles did not meet the “tongue” and “groove” limitations of the asserted patents, in essence, because they utilized a hook-type joint instead of a tongue and groove locking joint and therefore infringement could not be found under the claim construction Yekalon proposed for such limitations. See ALJ Decision at 91. Conversely, Complainant argued, inter alia, that the testing performed by its expert established that the Engagement profiles were infringing, that Yekalon’s own expert testified that the Engagement profiles were a modified hook-type joint that provided both vertical and horizontal locking, and that under Complainant’s proposed claim interpretation the Engagement profiles fell within the scope of the asserted patents. Id. at 90. The ALJ, relying on his claim construction of “tongue” to mean “a coupling part extending from the edge of a board, where the coupling part provides primary coupling in the horizontal direction and primary locking in the vertical direction,” and also on the testimony of Yekalon’s expert, found that a person of ordinary skill in the art would know that Yekalon’s Engagement profiles have a hook-type coupling joint instead of a tongue and groove coupling joint and as such provide primary coupling in the vertical direction and primary locking in the horizontal direction. See ALJ Decision at 67, 91. During his claim construction analysis, the ALJ also found “no support in the patents in issue for a vertical coupling of panels, but instead [found] support only for horizontal coupling of panels.” Id. at 67 (emphasis added). Moreover, the ALJ found that the test conducted by Complainant’s expert could not establish infringement of the patent claims asserted against the Engagement profiles. Id. at 91. Consequently, the ALJ concluded that the Engagement profiles did not satisfy the “tongue” limitation and therefore did not infringe any of the claims asserted against them (namely, claim 1 of the `836 patent and claims 3 and 4 of the `292 patent). Id.; see Respondents’s Exhibits X-1008C, X-1009C, X-1010C, X-1011C, X-1019C, X-1020C, X-1021C, X-1022C; see also Ruling Request (April 9, 2010) Exhibits E-L. Yekalon now seeks a determination whether its “Tap & Go” laminated floor panels, which it claims are modified versions of the above-referenced Engagement profiles found not to infringe at the ITC, are subject to the 545 GEO. See Ruling Request (April 9, 2010) at 1, 3 (“Yekalon’s Engagement locking profiles are relevant to this § 177 Request because this profile is the locking profile contained in Yekalon’s ‘Tap & Go’ laminated flooring products” and “Yekalon has developed an improved second generation Engagement profile and continues to sell its laminated floor products containing this profile under the ‘Tap & Go’ name”). One of the improvements to the modified “Tap & Go” laminated floor panel relates to the length of the lower hook, specifically that the lower hook is longer in the “Tap & Go” panel than in the legacy Engagement panel, which, according to Yekalon, provides greater flexibility to aid in locking coupled panels. See Ruling Request Supplement (December 21, 2010) at 1. Another improvement is the lower hook of the modified “Tap & Go” panel exhibits a deeper recess that is directly opposite and extends away from the upper hook as seen when two panels are coupled. Yekalon claims this recess distributes tension, thereby making the coupling joint less likely to crack. Id. Yekalon, as a foreign manufacturer and seller of laminated floor panels, is not an importer of record of panels making entry for consumption into the United States. See 19 U.S.C. § 1484(a)(1), (b)(2)(B). However, purchasers of the laminated floor panels manufactured by Yekalon have continued to enter the modified “Tap & Go” panels since shortly after the issuance of the 545 GEO. See Ruling Request (April 9, 2010) at 6 (“Yekalon’s customers have been regularly importing the ‘Tap & Go’ products into the U.S. since April of 2007.”). As such, Yekalon qualifies as a “person who, as an importer or exporter of merchandise, or otherwise, has a direct and demonstrable interest in the question or questions presented in the ruling request” where “person” is defined as “an individual, corporation, partnership, association, or other entity or group.” 19 C.F.R. Part 177.1(c). Yekalon’s “Tap & Go” panels that are the subject of this ruling are depicted in the following technical drawings that focus on the panel’s locking mechanism. See Ruling Request (April 9, 2010) Exhibit D. [
 ] ISSUE: The issue presented is whether Yekalon’s modified “Tap & Go” laminated floor panels are covered by any of the patents listed in the 545 GEO. LAW AND ANALYSIS: Utility patent infringement determinations entail two steps. The first step is to interpret the meaning and scope of the patent claims asserted to be infringed. The second step is to compare the properly construed claims to the accused device. See Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995) (en banc), aff’d, 517 U.S. 370 (1996). The first step is a question of law; the second step is a question of fact. See Freedman Seating Co. v. American Seating Company, 420 F.3d 1350, 1357 (Fed. Cir. 2005). The ITC applies the above framework when conducting an investigation to determine whether the imported articles accused infringe a United States patents, such that they should be refused entry. See 19 U.S.C. § 1337(a)(1)(B), (b)(1), (d), (f). Specifically, 19 U.S.C. § 1337(d) provides the Commission authority to direct the exclusion from entry of the articles found to infringe. Moreover, when the Commission determines that there has been a violation of section 337, as amended, it may issue two types of exclusion orders: a limited exclusion order and/or a general exclusion order. See Fuji Photo Film Co., Ltd. v. U.S. Int’l Trade Comm’n, 474 F.3d 1281, 1286 (Fed. Cir. 2007). Both types of orders direct CBP to bar the infringing products from entering the country. See Yingbin-Nature (Guangdong) Wood Indus. Co. v. U.S. Int’l Trade Comm’n, 535 F.3d 1322, 1330 (Fed. Cir. 2008). A limited exclusion order is “limited” in that it only applies to the specific parties before the Commission in the investigation. Id. In contrast, a general exclusion order bars the importation of infringing products by everyone, regardless of whether they were respondents in the Commission’s investigation. Id. A general exclusion order is only appropriate if two exceptional circumstances apply. See Kyocera Wireless Corp. v. U.S. Int’l Trade Comm’n, 545 F.3d 1340, 1356. A general exclusion order may only issue if (1) “necessary to prevent circumvention of a limited exclusion order” or (2) “there is a pattern of violation of this section and it is difficult to identify the source of infringing products.” 19 U.S.C. § 1337(d)(2); see also Kyocera, 545 F.3d at 1356 (“If a complainant wishes to obtain an exclusion order operative against articles of non-respondents, it must seek a GEO by satisfying the heightened burdens of §§ 1337(d)(2)(A) and (B).”). The 545 GEO issued by the ITC provides, in relevant part, that: Laminated floor panels covered by one or more of claims 1, 2, 10, 18, and 23 of the ‘836, claims 3 and 4 of the ‘292 patent, and claims 5 and 17 of the ‘779 patent are excluded from entry into the United States for consumption, entry for consumption from a foreign-trade zone, or withdrawal from warehouse for consumption, for the remaining term of the listed patents, except under license of the patent owner or as provided by law. The ITC’s order here is typical of general exclusion orders, speaking in terms of patent claims rather than parties and/or infringing products. See Yingbin-Nature, 535 F.3d at 1331. The GEO directs CBP to exclude laminated floor panels, regardless of the identity of their manufacturer or importer of record, that are covered by the relevant patent claims. Additionally, “exclusion orders must be read in the context of the investigations in which they were issued and the Commission’s findings in that investigation.” In the Matter of Certain GPS Devices and Products Containing Same, Investigation No. 337-TA-602, Advisory Opinion (April 20, 2010) at 4. As further explained by the ITC: The language of Commission limited exclusion orders directed to articles of named respondents “that infringe” or articles “covered by” generally refers to articles found by the Commission to infringe and articles that are “‘essentially the same,’ meaning that the differences between them are merely ‘colorable’ or ‘unrelated to limitations in the claim of the patent.’” Id. citing Yingbin-Nature, 535 F.3d at 1332, which cites Acumed LLC v. Stryker Corp., 525 F.3d 1319, 1324 (Fed. Cir. 2008). Likewise, determinations by the ITC finding non-infringement of a respondent’s accused articles have the same effect, such that an article is not subject to an exclusion order when it is essentially the same as an article determined not to infringe during the investigation at the ITC. Notwithstanding the above, the Federal Circuit has recognized that issuance of a general exclusion order by the ITC binds named parties and non-named parties alike and shifts to importers, “as a condition of entry, the burden of establishing noninfringement.” Hyundai Electronics Industries Co. v. U.S. Int’l Trade Comm’n, 899 F.2d 1204, 1210 (Fed. Cir. 1990). Accordingly, the burden is on the party seeking admissibility to establish that the articles at issue are not covered by any of the relevant patents. See also Vastfame Camera, 386 F.3d 1108, 1113 (Fed. Cir. 2004). CLAIMS 1, 2, 10, 18, AND 23 OF U.S. PATENT NO. 6,490,836 The subject matter of the `836 patent, as indicated in the abstract, pertains to a floor panel which, at least at the edges of two opposite sides, is provided with coupling parts in the form of a tongue and a groove which prevent the drifting apart of two coupled floor panels. Of the claims identified in the exclusion order, claims 1, 2, 10, and 23 are independent claims while claim 18 is dependant on claim 10. Claim 1, shown below, is representative of the relevant claims from this patent because all contain a limitation requiring a “tongue” and a “groove.” 1. A floor covering comprising a hard floor panel having a substantially planar underside and at least two opposed side edges, said side edges including complementary coupling parts configured to cooperate with identical cooperative complementary coupling parts of another one of said panel, said coupling parts comprising substantially a tongue and a groove extending along panel side edges generally parallel to the panel underside and including integrated mechanical locking elements, said tongue, groove and locking elements formed in one piece with the panel, said tongue, groove and locking elements arranged to prevent drifting apart of the floor panel when coupled by said coupling parts to another one of said floor panel in a direction perpendicular to the adjacent side edges of the coupled panels, and parallel to the underside of the panel; a coupling part of said panel, when engaged with a complementary coupling part of another one of said panel, configured and arranged to produce a biasing force between such coupled panels tending to urge the panels towards each other; at least one of said coupling parts including an elastically bendable portion having a relaxed unbent position, and which, when in a coupled condition, is at least partially bent out of its normal relaxed position and thereby provides said biasing force; wherein the elastically bendable portion of said one of said coupling part comprises a lower lip defined at least in part by a lower side of the groove of said coupling parts, said lower lip cooperating with a mating portion of a tongue of a cooperating coupling part; wherein said lip when bent extends in a downward direction relative to the panel underside when the panel is coupled by cooperative complementary coupling parts to another one of said panel; wherein the panel comprises a core comprising a material selected from the group consisting of HDF and MDF board; said lower lip is substantially formed of said core; one of said locking elements comprises a recess in said lower lip, said recess having a lowermost bottom area; said groove having a deepest point within the panel; and wherein said elastically bendable portion of the lower lip comprises a portion of said lower lip located between the deepest point of said groove and the lowermost bottom area of said recess; wherein the bendable portion of the lower lip includes a side wall of said recess that slopes downwardly in a direction extending from a distally outer area of said lip towards a proximally inner area of said lip.  (emphasis added). As shown above and reflected in the patent specification, the claim at issue requires a floor panel having coupling parts comprising a tongue and a groove. See `836 patent, col. 5, ll. 49-51 (“The coupling parts 4-5 can be realized in various forms, although the basic forms thereof will always be formed by a tongue 9 and a groove 10.”) (emphasis added). The ALJ, as highlighted above (supra at 4), interpreted “tongue” to mean “a coupling part extending from the edge of a board, where the coupling part provides primary coupling in the horizontal direction and primary locking in the vertical direction.” ALJ Decision at 67, 91-92 (emphasis added). The ALJ also interpreted “groove” to mean “a coupling part that cooperates with a tongue to connect two panels together.” Id. at 67. The specification provides further illustration regarding the nature of the claimed invention, particularly in Figures 8 to 11 and Figures 22-25 (shown below). See also ALJ Decision at 41, FN 12 (“FIG. 23, ‘on a larger scale, represents the coupling of two floor panels of FIG. 22’ while ‘FIG. 22 represents a floor panel according to the invention.’ (JX-1 at 5:5-9).” As depicted in the above patent figures, the claimed invention requires correspondence between tongue 9 and groove 10 in order to provide primary coupling in the horizontal direction and primary locking in the vertical direction to prevent the panels from drifting apart. As indicated above, certain Yekalon profiles (i.e., category (1), supra at 3-4) were found to infringe claim 1 of the `836 patent, as each was determined to exhibit a tongue and a groove. See ALJ Decision at 76-77; see also RS 001-003, RS 010-012, RS 109-111, RS 007-009, RS 004-006, RS 025-027, RS 031-033. However, the legacy Yekalon Engagement profiles (i.e., category (2), supra at 4), depicted below in technical drawings and micrographs, were found not to infringe claim 1 of the `836 patent because they did not exhibit a tongue, as construed, and therefore did not primarily provide horizontal coupling and vertical locking. See Ruling Request (April 9, 2010) at 4-6, Exhibits E-L (RX-1008 C, RX-1009 C, RX-1010 C, RX-1011 C, RX-1019 C, RX-1020 C, RX-1021 C, RX-1022 C). [



 ] The Yekalon modified “Tap & Go” panels at issue here are depicted in the technical drawings below. See Ruling Request (April 9, 2010) Exhibit D (also supra at 6). Based on a comparison between the intrinsic evidence from the `836 patent along with the ALJ’s findings and Yekalon’s legacy and modified profiles depicted in the administrative record, the determination here is that the locking mechanism of the “Tap & Go” panels is essentially the same as the hook-type joint found not to infringe at the ITC (i.e., the locking mechanism within the legacy category (2) Engagement profiles) since any differences between them are merely colorable and unrelated to limitations in the claim of the patent. Specifically, as with the legacy Engagement profiles, the modified “Tap & Go” panels couple vertically and do not exhibit a “tongue” that provides primary coupling in the horizontal direction and primary locking in the vertical direction. Instead, the technical drawings below show that the locking mechanism in the modified “Tap & Go” panel provides primary coupling in the vertical direction and primary locking in the horizontal direction. Therefore, as with the legacy Engagement profiles at issue before the ALJ, the test performed at the ITC by Complainant’s expert is not appropriate to analyze the modified “Tap & Go” panels. See ALJ Decision at 91. [ ] Moreover, the ALJ’s finding that the patents at issue do not cover panels that are primarily coupled in the vertical direction further supports the analysis above and is consistent with the testimony of Complainant’s expert during the investigation hearing. See ALJ Decision at 67; see also Confidential Hearing Transcript, Testimony of Dr. Joseph R. Loferski, Vol. 3, April 5, 2006, pages 819:15-820:1 ([“ .”]); see also Ruling Request Supplement (September 21, 2011) at 2; Ruling Request Supplement (December 14, 2011) at 2. The modified “Tap & Go” panels, like the legacy “Engagement” panels found not to infringe at the ITC, are capable of being coupled in the vertical direction and do not satisfy the “tongue” limitation as construed to require primary coupling in the horizontal direction and primary locking in the vertical direction. Consequently, and because the “tongue” limitation appears in every relevant claim, the determination here is that the “Tap & Go” panels are not covered by representative claim 1 or any other listed claim from the `836 patent. CLAIMS 3 and 4 OF U.S. PATENT NO. 6,874,292 The subject matter of the `292 patent, as indicated in its abstract and similar to that from the `836 patent, pertains to a floor panel which, at least at the edges of two opposite sides, is provided with coupling parts in the form of a tongue and a groove and thereby prevents the drifting apart of two coupled floor panels. Claims 3 and 4 identified in the exclusion order are both dependent, with the former depending from claim 2, which in turn depends from independent claim 1, and the latter depending from claim 3. As with the `836 patent, all of the relevant claims from this patent contain limitations requiring a “tongue” and a “groove.” Furthermore, the ALJ provided the same construction for these limitations in both the `836 patent and the `292 patent. See ALJ Decision at 65. Accordingly, for the reasons noted above, the determination here is that the modified “Tap & Go” panels are not covered by claim 3 or 4 of the `292 patent. CLAIMS 5 and 17 OF U.S. PATENT NO. 6,928,779 The `836 patent, the `292 patent, and the `779 patent are all related. See Commission Opinion at 5. As with the above, the subject matter of the `779 patent, as indicated in the abstract, pertains to a floor panel which, at least at the edges of two opposite sides, is provided with coupling parts in the form of a tongue and a groove which prevent the drifting apart of two coupled floor panels. Of the claims identified in the exclusion order, dependent claims 5 and 17 depend from independent claims 1 and 13, respectively. Although the legacy Engagement profiles were not accused at the ITC of infringing the `779 patent, Yekalon acknowledges that, despite this fact, the nature of general exclusion orders would prevent entry of Yekalon’s modified panels if they are covered by any listed claims of the `779 patent. However, Yekalon also points to the fact that, like the `836 patent and the `292 patent discussed above, all relevant claims of the `779 patent contain a limitation requiring a tongue and groove. See Ruling Request Supplement (December 14, 2011) at 2-3. Accordingly, for the reasons above, the determination here is that the modified “Tap & Go” panels are not covered by claims 5 or 17 of the `779. HOLDING: Yekalon’s modified “Tap & Go” laminated floor panels are not subject to the 545 GEO because they do not exhibit a “tongue” as required by the relevant claims of the listed patents. Accordingly, the panels are admissible into the United States and may make entry for consumption, entry for consumption from a foreign-trade zone, and withdrawal from a warehouse for consumption. This decision is limited to the specific facts set forth herein. If the laminated floor panels differ from the embodiment described above, or if future importations vary from the facts stipulated to herein, this decision shall not be binding on CBP as provided for in 19 C.F.R. Part 177.2(b)(1), (2), and (4), and Part 177.9(b)(1) and (2). Sincerely, Charles R. Steuart Branch Chief Intellectual Property Rights Branch