9 August 2013
Mayer Brown, a leading global law firm, secured a major victory this week before the US International Trade Commission (ITC) on behalf of Pernod Ricard USA in a patent infringement suit brought by Lamina Packaging Innovations LLC, a non-practicing entity or “patent troll,” against Pernod Ricard and several other companies in the consumer and luxury goods industries.
In a precedent-setting decision, the ITC upheld Administrative Law Judge Theodore Essex’s July ruling in favor of Pernod Ricard, finding no domestic industry in the first case of its type under the ITC’s pilot program.
The ITC announced in July that this investigation would be the first in its newly launched program intended to streamline Section 337 investigations and make them more efficient.
“This is an important precedent-setting decision, not only for Pernod Ricard but also for other companies that face Section 337 investigations brought by non-practicing entities such as Lamina,” said A. John P. Mancini, co-lead counsel for Pernod Ricard and a co-leader of Mayer Brown’s global Intellectual Property practice. “It demonstrates that the domestic industry requirement has teeth, and that Section 337’s remedies are available to companies that add economic value to the U.S. economy but not entities that merely purchase patents and bring lawsuits as a source of revenue.”
In Certain Products Having Laminated Packaging, Laminated Packaging, and Components Thereof, Inv. No. 337-TA-874, Lamina filed a complaint with the ITC under Section 337 on February 20, 2013, alleging infringement of two patents relating to a certain type of laminated packaging used by Pernod Ricard in connection with the marketing and sale of its popular Chivas Regal, Jameson and Martell brands of distilled beverages. The complaint sought to exclude the allegedly infringing products from being imported into the United States. Lamina alleged that it satisfied the domestic industry requirement by leveraging off of its licensing activities, as well as the activities and investments of its licensees. The ITC asked Judge Essex to hold an early evidentiary hearing and issue a decision within 100 days of institution as to whether Lamina’s activities indeed met the “economic prong” of the domestic industry requirement. This was the first time that the Commission required a trial and early decision on the domestic industry issue.
At a two-day hearing held in May 2013, the ALJ heard the evidence on Lamina’s ability to establish the “economic prong” of the domestic industry requirement. In his July decision, Judge Essex found that Lamina failed to satisfy the economic prong of the domestic industry requirement and therefore the investigation should be terminated with a finding of no violation by the respondents, including Pernod Ricard. The case is still subject to consideration by the full Commission but the case is otherwise stayed pending Commission review.
“We’re delighted with the ruling,” said Brian Chevlin, Pernod Ricard USA’s General Counsel. “While we’re confident that we would have prevailed on the merits of the patent dispute, we also believe strongly that this is not the sort of case that belongs in the ITC and are pleased that the ITC devised a procedure which allowed Judge Essex to address this issue at an early stage of the investigation.”
The Mayer Brown Intellectual Property litigation team was co-led by partners A. John P. Mancini (New York) and Gary Hnath (Washington, DC).