In a case involving emerging technology, the U.S. International Trade Commission last week took the rare move of staying an order order it issued in April against a company that was found to infringe a competitor’s patents on a teeth-straightening technique, saying it would wait for an appellate ruling.
The action came in a closely watched patent infringement case brought by Align Technology Inc., a maker of a clear, almost invisible teeth-straightening system, against ClearCorrect Operating LLC. ClearCorrect generates digital models of patients’ teeth in its overseas offices and transmits the digital data to its headquarters in Texas, where 3D printers create molds used to make the teeth-straightening aligners.
The ITC had issued cease-and-desist orders against ClearCorrect, ruling that it can ban infringing products brought into the United States through electronic transmission because they are deemed “articles,” even though they don’t have physical form. The decision was issued after a full review by the commission and public comment from major companies and organizations with a stake in digital technology, including Google Inc., Nokia, the Motion Picture Association of America and the Association of American Publishers. Google argues that the ITC’s jurisdiction doesn’t cover digital imports, while Nokia, the MPAA and the AAP supports the ITC’s jurisdiction.
In May, ClearCorrect, represented by Michael Myers of McClanahan Myers Espy in Houston, requested a stay of the cease-and-desist orders pending appeal to the U.S. Court of Appeals for the Federal Circuit. It argued that the commission admitted it was difficult to decide the jurisdictional issue and that one commissioner dissented, and it claimed it would suffer irreparable harm if it had to cease operations before its appeal had been heard. In addition, “the public interest factor also weighs heavily in favor of a stay,” Myers wrote.
Align Technology, represented by Thomas Counts of Paul Hastings in San Francisco, objected to the stay request, as did the ITC’s investigative attorney. They argued that ClearCorrect is unlikely to prevail on the merits, that it cannot demonstrate irreparable injury, and that its continued infringing activities would harm Align.
ClearCorrect attorney Myers said he wasn’t expecting the ITC to issue the stay and was preparing to file a motion for an emergency stay with the Federal Circuit. The ITC opinion has not yet been published, as the commission allows parties time to redact information deemed confidential. But Myers said the commission’s decision to stay its ruling pending the appeal was based primarily on the novel issue and difficulty in establishing whether the agency has jurisdiction over digital imports. We did not hear back from Align’s attorney Counts.
The name of the case is In the Matter of Certain Digital Models, Digital Data and Treatment Plans for Use in Making Incremental Dental Positioning Adjustment Appliances, the Appliances Made Therefrom and Methods of Making the Same, 337-833.