PublishedJuly 6, 2021

The ITC In 2020: Anything But Typical

With the American republic having just had its 245th birthday, let’s take a look at an agency that’s charged with regulating trade with foreign countries, encouraging American industries, and protecting American labor.

I’ve previously criticized the International Trade Commission (ITC) for having gone from being a trade court protecting U.S. domestic industry to being a specialist patent court that protects patent owners, regardless of whether they’re American and regardless of whether the defendants are American.  And, as I found when reviewing ITC cases, the facts show that while the “typical ITC case” is described as having “a domestic complainant [plaintiff] and a foreign respondent [defendant],” the reality is quite different.


I took a list of all ITC cases that were filed in 2020 from the ITC’s data.  I then hand-coded each case for whether it had at least one U.S. complainant and/or at least one foreign complainant.  (Obviously, if there’s at least one foreign complainant and no U.S. complainants, then all complainants are foreign, so this lets us detect the mix of foreign/U.S. complainants at the ITC.)  I also examined if the U.S. complainants were counterparts to foreign entities.  For example, Philips has a U.S. presence, but it’s a Dutch corporation, so if Philips U.S. was the complainant, this would have been coded as a yes.

Similarly, I coded the set of respondents based on whether all were U.S. owned or all were foreign.  I also looked at the corporate relationships to determine if all foreign respondents had U.S. counterparts—for example, Nintendo (Japan) and Nintendo of America.  This is important because those cases could have been brought in U.S. district courts against at least the U.S. entity, if not both.  (And in fact, such suits are often filed in parallel to the ITC actions.)

Finally, for each case, I coded for patent-assertion entity (PAE) status.  This was intentionally rigid—it omits non-practicing entities (NPEs) like universities and operating companies who do not themselves practice the relevant patent (e.g., Nokia or Maxell).  Only entities that acquire patents for the purpose of litigation were coded as yes—what the ITC itself would code as a “Category 2 NPE.”


There were 57 cases filed at the ITC in 2020.  Of those cases, there were 3 with purely foreign respondents and 13 with purely domestic respondents, leaving 41 with a mix of respondent nationalities.  So the “typical” ITC case isn’t against only foreign companies—instead, typically there’s a mix of foreign and domestic respondents.  And about 23% of all cases involved solely domestic defendants—the opposite of what’s seen as a “typical” ITC case!

That leaves 41 cases where the respondents were a mix of foreign and domestic entities.  If we look at those 41 cases in more detail, 29 cases had purely American complainants and mixed respondents.  But of those 29 cases, in 16 of them, all foreign respondents had U.S. counterparts.  For example, a case naming both LG (Korea) and LG (U.S.) as respondents is coded as mixed, but all foreign entities have a U.S. counterpart amenable to suit in U.S. district courts.  

Again looking at the 41 cases, 24 cases had mixed respondents with all respondents having U.S. counterparts.  (The 8 additional cases here over the 16 just described are cases with mixed complainants as well as mixed respondents.)

And looking in more detail at the 13 cases with purely American respondents, 11 of them were filed solely by American complainants.  That means that the ITC—the International Trade Commission—is adjudicating cases between two American companies, cases that should have gone to a U.S. district court instead.

And the “typical” ITC case, with U.S. complainants and foreign defendants?  2 cases out of 57.  I don’t think 3.5% of all cases qualifies as typical.  For that matter, there were 4 cases filed by purely foreign complainants against mixed respondents—twice as many as the so-called “typical” ITC case.

Finally, with respect to PAE status, I located 6 cases in 2020 filed by pure patent assertion entities.  Those were filed by Solas (2), Neodron, DivX LLC, Q3 Networking, and Pictos.  DivX LLC is a Fortress subsidiary.  (You might remember Fortress as the private equity company that funded a PAE that used Theranos patents to go after COVID-19 test technology early in the pandemic.)  Q3 Networking is an IP Edge company.  (They also went after COVID-19-related technology—in this case, ventilators.)  And Pictos used to be called Imperium IP Holdings, headquartered in the Caymans—but they changed their name to pretend they had a connection with the company whose patents they acquired.  (In reality, Pictos seems to be controlled by Vincent Capone, a private equity partner at Michaelson Capital, which appears to have heavily funded Imperium IP/Pictos.)  Solas and Neodron are projects of Jerry Padian, who also operates Realtime Data, a prolific PAE, and both are headquartered in Ireland.

So that’s 6 PAE cases.  Three were filed by foreign entities and three are vehicles for private equity firms to make money.  It’s unclear why the ITC claims it only saw 3 PAE-type cases in 2020—all six of these are clear cases of patent acquisition in order to assert.


The ITC doesn’t seem to be widely used for cases where a solely foreign company is going after solely American companies at the ITC.  But there does seem to be a common theme: the “typical” ITC case of an American company using the ITC to protect itself against foreign companies is anything but typical. 

And the ITC isn’t being used because the remedy it provides—exclusion from importation—is needed in order to reach infringement that would otherwise be impossible to redress.  In half of all ITC cases in 2020, all involved parties could have been hailed into U.S. district court for the alleged patent violations.  In nearly a quarter of them, there were no foreign parties involved at all.  The ITC was never supposed to replace U.S. district courts, but that’s what at least some complainants appear to be trying to use it for.

And while PAE usage of the ITC hasn’t yet become a majority of cases—unlike the Western and Eastern Districts of Texas, the other favored forums for patent assertion—they continue to make up a strong sub-component of the ITC’s caseload.

The ITC needs change.  It should lose its current jurisdiction over cases that U.S. district courts could properly (and easily) handle, making sure defendants with a U.S. presence receive all of the process and remedy protections that district court cases provide.  

And at the very least, especially given the focus in Congress on protecting U.S. industry, the ITC needs something like the bill introduced by Reps. DelBene and Schweikert last session.  The Advancing America’s Interests Act would help ensure that PAEs and other entities that don’t have any actual U.S. presence can’t sue in the ITC.  It would also bar the practice of “domestic industry by subpoena,” where a company which doesn’t have its own U.S. industry forces a company that does to take a license under the threat of litigation.  Then, once that licensee has signed up, the patent owner forces the licensee to pay for lawyers and disclose technical information in the ITC, all on behalf of the same company that threatened them with litigation to get them to pay for a license in the first place.  Even just ending these two practices would significantly improve the situation for U.S. industry at the ITC, limiting their exposure to PAEs funded by private equity and letting companies that take a license not worry about being hauled to the ITC to support someone else’s financial interests.

The coded data used for this analysis is available upon request.

Josh Landau

Patent Counsel, CCIA

Joshua Landau is the Patent Counsel at the Computer & Communications Industry Association (CCIA), where he represents and advises the association regarding patent issues.  Mr. Landau joined CCIA from WilmerHale in 2017, where he represented clients in patent litigation, counseling, and prosecution, including trials in both district courts and before the PTAB.

Prior to his time at WilmerHale, Mr. Landau was a Legal Fellow on Senator Al Franken’s Judiciary staff, focusing on privacy and technology issues.  Mr. Landau received his J.D. from Georgetown University Law Center and his B.S.E.E. from the University of Michigan.  Before law school, he spent several years as an automotive engineer, during which time he co-invented technology leading to U.S. Patent No. 6,934,140.

Follow @PatentJosh on Twitter.

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