H315645

HQ H315645 March 11, 2021 OT:RR:BSTC:EOE H315645 SEH CATEGORY: 19 U.S.C. §1337; Unfair Competition VIA EMAIL: MBernstein@perkinscoie.com Matthew C. Bernstein Perkins Coie LLP 11452 El Camino Real Suite 300 San Diego, CA 92130-2080 RE: Ruling Request; U.S. International Trade Commission; Limited Exclusion Order; Investigation No. 337-TA-1118; Certain Moveable Barrier Operator Systems and Components Thereof Dear Mr. Bernstein: Pursuant to 19 C.F.R. Part 177, the Exclusion Order Enforcement Branch, Regulations and Rulings, U.S. Customs and Border Protection (“CBP”) issues this administrative ruling in response to your December 15, 2020 letter (noting accompanying Exhibits 1-14 and the Declarations of Nortek employee David Null and expert witness Prof. Hamid Toliyat) (collectively “ruling request”). The ruling request was submitted on behalf of your clients Nortek Security & Control LLC, Nortek, Inc., and GTO Access Systems, LLC (collectively, “Nortek” or “Requesters”), in which you requested an administrative ruling, related to the limited exclusion order (“the 1118 LEO”) issued by the U.S. International Trade Commission (“ITC” or “the Commission”) in Investigation No. 337-TA-1118, Certain Movable Barrier Operator Systems and Components Thereof (“the 1118 investigation”). CBP’s position as set forth more fully below is that Nortek has met its burden to show that certain garage door openers (“GDOs”) do not infringe claims 1 and 21 (“Claims-At-Issue”) of U.S. Patent No. 7,755,223 (“the ’223 Patent”) on which the 1118 LEO is based.  This ruling letter is the result of an inter partes process administered by CBP upon consent of the parties. The inter partes process involved the parties with a direct and demonstrable interest in the question presented by the ruling request: your clients Nortek, and the Chamberlain Group, Inc. (“CGI”), which are, respectively, Respondents and Complainant from the 1118 investigation. If there is information in this ruling letter not currently bracketed in red [[ ]] that Nortek believes constitutes confidential information, and should be redacted from the published ruling, then Nortek is asked to contact CBP within ten (10) working days of the date of this ruling letter clearly identifying such confidential information with [[red brackets]]. See, e.g., 19 C.F.R. § 177.8(a)(3). Please note that disclosure of information related to administrative rulings under 19 C.F.R. Part 177 is governed by, for example, 6 C.F.R. Part 5, 31 C.F.R. Part 1, 19 C.F.R. Part 103, and 19 C.F.R. § 177.8(a)(3). See, e.g., 19 C.F.R. § 177.10(a). In addition, CBP is guided by the laws relating to confidentiality and disclosure, such as the Freedom of Information Act (“FOIA”), as amended (5 U.S.C. § 552), the Trade Secrets Act (“TSA”) (18 U.S.C. § 1905), and the Privacy Act of 1974, as amended (5 U.S.C. § 552a). A request for confidential treatment of information submitted in connection with a ruling requested under 19 C.F.R. Part 177 faces a strong presumption in favor of disclosure. See, e.g., 19 C.F.R. § 177.8(a)(3). The person seeking this treatment must overcome that presumption with a request that is appropriately tailored and supported by evidence establishing first that the submitter customarily keeps the information private or closely-held, and either that (a) the government provided an express or implied assurance of confidentiality when the information was shared with the government or (b) there were no express or implied indications at the time the information was submitted that the government would publicly disclose the information. See, e.g., OIP Guidance: Step-by-Step Guide for Determining if Commercial or Financial Information Obtained from a Person is Confidential Under Exemption 4 of the FOIA (posted 10/3/2019). BACKGROUND Part 177 Request, Exclusion Order Enforcement Branch On December 15, 2020, Nortek submitted its Ruling Request seeking an administrative ruling pursuant to 19 C.F.R. Part 177 whether certain GDOs are subject to the 1118 LEO. Specifically, the Ruling Request requested: Pursuant to 19 C.F.R. § 177, Nortek hereby requests a ruling that certain [GDOs] and components thereof to be imported by or on behalf of Nortek are not subject to exclusion from entry for consumption in the United States because they have been redesigned to eliminate two required claim elements of [the ’223 Patent] covered by the [1118 LEO]. Therefore, the transaction that Nortek seeks approval for is Nortek’s proposed importation of GDOs which are not “covered articles” under the LEO because they do not infringe claims 1 and 21 of the ’223 Patent. See Ruling Request at 1. On December 30, 2020, CGI noted that Nortek had transmitted its unredacted request and all exhibits to CGI on December 22, 2020, after execution of a non-disclosure agreement for the ruling request (337-TA-1118). See E-mail from Derek Gosma, Counsel for CGI, to EOE Branch (Dec. 30, 2020). On January 22, 2021, the date by which the parties had agreed CGI was due to submit a response to Nortek’s ruling request, instead of a submission in opposition, CGI submitted a letter that identified Nortek’s ruling request, as well as the physical samples and additional source code that Nortek provided directly to CGI at CGI’s request, and contained a copy of a Joint Stipulation executed on January 21, 2020, by Nortek and CGI (“Joint Stipulation”). As set forth in CGI’s letter: Pursuant to the stipulation, Chamberlain agreed not to oppose Nortek’s request contingent upon Nortek’s representation that it has in fact removed the accused feature from its products and that the technical materials and sworn declarations it submitted actually reflect the operation of its products. Accordingly, Chamberlain submits this letter to inform your office that it will not oppose Nortek’s request with respect to . . . Nortek products (which are listed in the parties’ stipulation): . . .; but only to the extent manufactured and imported after November 1, 2020, with the beam always turned on and identified with a neon green sticker on the package (“Nortek Products-At-Issue”). January 22, 2021, Letter from Dave D. Marcus, Counsel for CGI; See Appendix A hereto (Joint Stipulation.) On January 27, 2021, Nortek and CGI participated in a call with CBP, wherein the parties confirmed that CGI’s stipulated non-opposition with respect to Nortek’s non-infringement arguments is limited to the specific model numbers set forth in the Joint Stipulation. CGI maintained this position, even as to changes in model numbers, notwithstanding that Section 337 exclusion orders are routinely cast in terms of excluding infringing articles rather than specific models. However, the parties pledged on the call with CBP to work together and to exchange information necessary to reach consensus regarding additional GDO models for which CGI would similarly not oppose a ruling request. The parties could then present any such consensus jointly to CBP in support of a future request for an administrative ruling from CBP pursuant to Part 177 which, if successful, would provide a basis for CBP to exercise its discretion to permit certification for additional model numbers that do not differ in any material way from the Nortek Products-at-Issue. In addition, CBP notes with respect to concluding statements in the Joint Stipulation, similarly included in CGI’s January 22, 2021, letter, that indirect notice of an exclusion would be available from the Commission’s website via posting on its Electronic Document Information System (EDIS) should any seizure and forfeiture order issue after the conditions in 19 U.S.C. § 1337(i) are met. Commission Advisory Proceeding, Inv. No. 337-TA-1118 On January 29, 2021, Nortek filed the Joint Stipulation in the ITC advisory opinion proceeding (a proceeding referred to in the Joint Stipulation) that the Commission had instituted regarding its exclusion order following a request filed with the Commission by Nortek on De

Section 337 Exclusion Order AdministrationUnder Section 337 of the Tariff Act of 1930, as amended, the Commission shall investigate any alleged violation of this section to determine, with respect to each investigation conducted by it under this section, whether there is a violation of this section. See 19 U.S.C. § 1337(b)(1) and (c). If the Commission determines, as a result of an investigation under this section, that there is a violation of this section, it shall direct that the articles concerned, imported by any person violating the provision of this section, be excluded from entry into the United States unless the Commission finds based on consideration of the public interest that such articles should not be excluded from entry. See 19 U.S.C. § 1337(d)(1).When the Commission determines there is a violation of section 337, it generally issues one of two types of exclusion orders: (1) a limited exclusion order or (2) 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 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. 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.The “Commission has broad discretion in selecting the form, scope and extent of the remedy. Viscofan, S.A. v. United States ITC, 787 F.2d 544, 548 (Fed. Cir. 1986). The Commission has consistently issued exclusion orders coextensive with the violation of Section 337 found to exist.” See Certain Erasable Programmable Read Only Memories, Inv. No. 337-TA-276, Enforcement Proceeding, Comm’n Op. at 11, Doc ID 43536 (Aug. 1991) (empha