Certain Shaker Screens for Drilling Fluids, Components Thereof, and Related Marketing Materials; Notice of a Commission Determination of Violation of Section 337; Issuance of a General Exclusion Order; Termination of the Investigation

AGENCY:

U.S. International Trade Commission.

ACTION:

Notice.

SUMMARY:

Notice is hereby given that the U.S. International Trade Commission has determined that there is a violation of section 337 of the Tariff Act of 1930, as amended, in the above-captioned investigation. The Commission has issued a general exclusion order (“GEO”) barring entry of certain shaker screens and components thereof that infringe certain claims of three patents asserted in this investigation. The investigation is terminated.

FOR FURTHER INFORMATION CONTACT:

Robert Needham, Esq., Office of the General Counsel, U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436, telephone (202) 708-5468. Copies of non-confidential documents filed in connection with this investigation may be viewed on the Commission's electronic docket (EDIS) at https://edis.usitc.gov. For help accessing EDIS, please email EDIS3Help@usitc.gov. General information concerning the Commission may also be obtained by accessing its internet server at https://www.usitc.gov. Hearing-impaired persons are advised that information on this matter can be obtained by contacting the Commission's TDD terminal on (202) 205-1810.

SUPPLEMENTARY INFORMATION:

The Commission instituted this investigation on November 21, 2019, based on a complaint, as amended, filed by M-I L.L.C. of Houston, Texas (“M-I”). 84 FR 64339 (Nov. 21, 2019). The amended complaint alleged violations of section 337 of the Tariff Act of 1930, as amended, 19 U.S.C. 1337, in the importation into the United States, the sale for importation, and the sale within the United States after importation of certain shaker screens for drilling fluids, components thereof, and related marketing materials by reason of infringement of: (1) Certain claims of U.S. Patent Nos. 7,210,582 (“the '582 patent”), 7,810,649 (“the '649 patent”), and 8,925,735 (“the '735 patent”); and (2) U.S. Trademark Registration Nos. 2,151,736 and 2,744,891. Id. The Commission's notice of investigation named six respondents, including Anping Shengjia Hardware Mesh Co., Ltd. (“SJ Screen”) and Hebei Hengying Wire Cloth Co. Ltd (“Hengying Wire Cloth”) (collectively the “Defaulting Respondents”). Id. at 64339-40. The Office of Unfair Import Investigations (“OUII”) is participating in this investigation. Id. at 64340.

On February 5, 2020, the Commission found SJ Screen and Hengying Wire Cloth in default. Order No. 10, unreviewed, Notice (Mar. 5, 2020). Thereafter, and after the termination of the other remaining respondents by consent order, see Order No. 8, unreviewed, Notice (Feb. 6, 2020); Order No. 14, unreviewed, Notice (Apr. 23, 2020), M-I withdrew all of its trademark-based allegations, as well as claims 2-11 of the '582 patent; claims 2-7 and 9 of the '649 patent; and claims 2-9, 13, 16, and 18-19 of the '735 patent from the investigation. See Order No. 19, unreviewed, Notice (Sept. 24, 2020). The patent claims remaining in the investigation are claims 1 and 12 of the '582 patent; claim 1 of the '649 patent; and claims 1, 12, and 17 of the '735 patent.

On August 27, 2020, M-I filed a motion for summary determination that the Defaulting Respondents violated section 337 and that M-I satisfies the domestic industry requirement of section 337. The motion sought issuance of a general exclusion order (“GEO”) and imposition of a one hundred percent (100%) bond on accused products imported during the Presidential review period. On September 16, 2020, OUII filed a response supporting M-I's motion, including the remedial relief requested therein.

On November 19, 2020, the ALJ issued the subject ID granting M-I's motion and recommending issuance of a GEO and imposition of a bond in the amount of 100 percent of the entered value of infringing products. Specifically, the ID found that (1) the Commission has jurisdiction over the products, the parties, and the investigation; (2) the importation requirement is satisfied; (3) M-I has standing to bring this investigation; (4) all of the remaining asserted claims are infringed by one or more of the Defaulting Respondents' products; and (5) M-I has satisfied the domestic industry requirement of section 337. Additionally, the ALJ recommended that the Commission issue a GEO and impose a bond in the amount of one hundred percent (100%) of the entered value of infringing articles imported during the period of Presidential review.

On January 4, 2021, the Commission determined to review the ID's finding that M-I's investments in plant and equipment and M-I's employment of labor and capital are significant under section 337(a)(3)(A) and (B). Notice (Jan. 4, 2021). The Commission also sought briefing on remedy, bonding, and the public interest. M-I filed a submission in response on January 19, 2021 and filed a corrected version of that response on January 22, 2021. OUII filed a submission in response on January 19, 2021 and filed a reply submission on January 26, 2021. No submissions were received from the public.

Having reviewed the written submissions and the evidentiary record, the Commission has determined to affirm the ID's finding that M-I satisfied the economic prong of the domestic industry requirement on the basis that M-I made significant investments in plant and equipment and significant employment of labor under section 337(a)(3)(A) & (B), 19 U.S.C. 1337(a)(3)(A) & (B), but to vacate the ID's value-added analysis (ID at 65-66).

The Commission has determined that the appropriate remedy in this investigation is a GEO prohibiting the unlicensed importation of certain shaker screens for drilling fluids and components thereof that infringe claims 1 and 12 of the '582 patent; claim 1 of the '649 patent; and claims 1, 12, and 17 of the '735 patent. The Commission has further determined that the public interest factors enumerated in section 337(d), 19 U.S.C. 1337(d), do not preclude issuance of the GEO. Finally, the Commission has determined that a bond in the amount of one hundred (100) percent of the entered value of the imported articles that are subject to the GEO is required to permit temporary importation of the articles in question during the period of Presidential review, 19 U.S.C. 1337(j). The investigation is hereby terminated in its entirety.

The Commission's order and opinion were delivered to the President and to the United States Trade Representative on the day of their issuance. The Commission has also notified the Secretary of the Treasury and Customs and Border Protection of the order.

The Commission vote for these determinations took place on March 18, 2021.

The authority for the Commission's determination is contained in section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and in Part 210 of the Commission's Rules of Practice and Procedure (19 CFR part 210).

While temporary remote operating procedures are in place in response to COVID-19, the Office of the Secretary is not able to serve parties that have not retained counsel or otherwise provided a point of contact for electronic service. Accordingly, pursuant to Commission Rules 201.16(a) and 210.7(a)(1) (19 CFR 201.16(a), 210.7(a)(1)), the Commission orders that the Complainant(s) complete service for any party/parties without a method of electronic service noted on the attached Certificate of Service and shall file proof of service on the Electronic Document Information System (EDIS).