John Mezzalingua Associate, Inc. v. International Trade Commission

The domestic industry requirement of section 337 of 19 U.S.C. § 1337 can be fulfilled in any one of three ways: 1. significant investment in plant and equipment; 2. significant employment of labor or capital; or 3. substantial investment in its exploitation, including engineering, research and development, or licensing.

John Mezzalingua Associates, Inc. (“JMA”) appealed from the International Trade Commission’s (“ITC”) ruling that the importation of infringing coaxial cable connectors did not violate section 337 of 19 U.S.C. § 1337. The Court of Appeals held that JMA failed to satisfy the domestic industry requirement of section 337 and therefore the ITC was correct in ruling that 19 U.S.C. § 1337 was not violated. The three ways to fulfill the domestic industry requirement of section 337 are: 1. significant investment in plant and equipment; 2. significant employment of labor or capital; or 3. substantial investment in its exploitation, including engineering, research and development, or licensing. JMA argued that cost incurred during trial enforcing U.S. Patent No. D440,539 that resulted in a settlement granting a license should be included as part of the third option for fulfilling the domestic requirement. The Court of Appeals stated that costs for trial enforcing a patent could be considered in fulfilling the domestic requirement, but the costs have to be closely related to the granting of the license as a settlement of the trial. The Court of Appeals agreed with the ITC that JMA had not shown that the costs of trials enforcing the patent were closely enough related to the granting of a license. JMA, in the alternative, argued that the designer’s salary should satisfy section 337, but the Court of Appeals found that while the salary could be included the amount of time to design the subject material of the design patent was too short for the amount of money from salary to fulfill section 337. AFFIRMED.