[00:00:00] Speaker 00:
The first case for argument is 17-2421, Echo Brands versus ITC.

[00:00:06] Speaker 00:
Mr. Lowe, whenever you're ready.

[00:00:15] Speaker 01:
May it please the Court, David Lau, on behalf of Appellants Echo Brands and Espresso Supply.

[00:00:24] Speaker 01:
Appellate Echo does not deny that it defaulted in the original underlying violation proceeding.

[00:00:29] Speaker 01:
As previously explained, it had good reason for doing this.

[00:00:32] Speaker 01:
It was a small Washington startup company with extremely limited resources and understanding insufficient to fight an ITC proceeding across the country.

[00:00:41] Speaker 01:
It had ceased all production and product importation as of that time, moving its manufacturing to the US.

[00:00:47] Speaker 01:
And it was engaged in a federal district court action involving not only the identical 320 patent infringement, but also its own patent infringement claims at that time.

[00:00:56] Speaker 02:
Well, the law is the law.

[00:00:58] Speaker 02:
to default and say we didn't have the money.

[00:01:03] Speaker 01:
You're correct, Your Honor.

[00:01:04] Speaker 02:
It's not a legal argument.

[00:01:07] Speaker 01:
Sure.

[00:01:07] Speaker 01:
Just giving some background, but it doesn't alter the fact that it did actively participate in the subsequent enforcement proceeding.

[00:01:14] Speaker 01:
And 337K and Commission rules allowed during that proceeding for it to rigorously challenge the remedial orders and seek their rescission.

[00:01:24] Speaker 01:
And we believe, Your Honor, that

[00:01:25] Speaker 01:
Your honors, that under 337 G1, which does not apply, and 337 K, as well as public policy, there's a number of very good reasons why those orders should have been rescinded in this case.

[00:01:37] Speaker 02:
Well, isn't there a temporary rescindment here pending the resolution of an appeal from the district court?

[00:01:46] Speaker 02:
And why wasn't that corrected?

[00:01:49] Speaker 01:
Because it should have been permanent, your honor, because there should not have been, there was no domestic industry.

[00:01:54] Speaker 01:
And at the time, those rescissions should have been completely gone away at the same time.

[00:01:58] Speaker 01:
So in other words, a temporary does not remove the cloud that's over echo.

[00:02:02] Speaker 01:
It doesn't allow them to proceed to get financing, to proceed to conduct their business.

[00:02:08] Speaker 01:
ARM and other competitors are using the fact of that continued injunction out there in the marketplace to erode their marketplace and put them as a disadvantage.

[00:02:15] Speaker 01:
They're imminently and continue to be prejudiced by this ongoing remedial orders that are in place.

[00:02:25] Speaker 01:
Your Honor.

[00:02:26] Speaker 00:
Do we have any idea what the appeal status is of our case, the District Court Enforcement Act?

[00:02:34] Speaker 01:
Yes, Your Honor.

[00:02:35] Speaker 01:
Just in June of this last year, that case went to trial.

[00:02:39] Speaker 01:
At that trial.

[00:02:40] Speaker 00:
No, I know.

[00:02:40] Speaker 00:
I know.

[00:02:41] Speaker 00:
But now it's on appeal here.

[00:02:42] Speaker 00:
And this case would go away if, I guess, one of two things is going to happen.

[00:02:48] Speaker 00:
Either we're going to affirm or reverse the determination of invalidity in the district court proceeding, right?

[00:02:54] Speaker 00:
If we affirm it, then this whole case goes away, right or no?

[00:03:00] Speaker 01:
We don't know that for sure.

[00:03:01] Speaker 01:
We filed a, Echo filed a petition after the June trial came out finding the claims invalid as well as not infringed.

[00:03:09] Speaker 01:
And in response, they temporarily, the ITC temporarily suspended it, but they didn't, they said pending appeal.

[00:03:16] Speaker 01:
They did not say there that if appeal came out,

[00:03:19] Speaker 04:
What's the impact of the 103 challenge on claims 1 and 10?

[00:03:25] Speaker 01:
What's the impact of that?

[00:03:27] Speaker 04:
What's up for grabs in the pending appeal to us from the district court in validity decision?

[00:03:33] Speaker 04:
That's a 103 rejection, right?

[00:03:35] Speaker 01:
Right.

[00:03:36] Speaker 01:
It has nothing to do with claims 1 or 10.

[00:03:37] Speaker 01:
They weren't asserted.

[00:03:39] Speaker 02:
What does it do with 8 and 19?

[00:03:41] Speaker 01:
Correct, Your Honor.

[00:03:42] Speaker 01:
The Washington case only dealt with claims 8 and 19, which were the only claims that were asserted in the ITC proceeding that remained after this court affirmed the invalidity of the rest of the claims.

[00:03:54] Speaker 00:
Right.

[00:03:54] Speaker 00:
So you're suggesting that even if we were to affirm the invalidity determination of the district court, you're saying it's still unclear what the government would do in this circumstance?

[00:04:06] Speaker 01:
It is.

[00:04:06] Speaker 01:
I think what the government should do is what they should have done before it and rescind those claims because there'll be no more valid claims at that point.

[00:04:13] Speaker 01:
But based on what the government submitted, all it said was that we're going to suspend it pending appeal.

[00:04:18] Speaker 01:
They didn't say if the appeal comes out one way or the other, what would happen.

[00:04:21] Speaker 01:
That leaves Echo again up in the air what's going on in addition to all the other harm of the ongoing remedial orders.

[00:04:27] Speaker 00:
Well, going back to the first point that you and Judge Roy had an exchange over,

[00:04:32] Speaker 00:
It's of your own making.

[00:04:34] Speaker 00:
I mean, you might have good reasons that justify you're doing a default under the earlier proceeding, but that's the way it is.

[00:04:41] Speaker 00:
So how do you get a ROM?

[00:04:43] Speaker 01:
Because, Your Honor, even though there was a default in the earlier proceedings, ECHO rigorously and vigorously pursued in the enforcement proceedings that those remedial orders should be rescinded.

[00:04:55] Speaker 01:
And it had the right to do so under 337K.

[00:04:58] Speaker 01:
Now that gets to the point about

[00:05:00] Speaker 04:
whether or not 337G1, which is what the government relies on... The arguments you're raising could have been raised in the original proceeding if you'd been there.

[00:05:09] Speaker 04:
True, Your Honor, but still when the enforcement proceedings were pursued... If you'd been there, you would have then had to appeal within the timely period and you didn't do that.

[00:05:18] Speaker 04:
The relief you're seeking is in the nature of 60B type relief.

[00:05:24] Speaker 01:
With due respect, Your Honor, I think the relief we're seeking is under 337K,

[00:05:28] Speaker 01:
and others which say that there's a changed circumstance or an error in the law that we're entitled to go in during the reinforcement proceeding and seek rescission of the remedial orders.

[00:05:38] Speaker 01:
And both of those things apply here.

[00:05:40] Speaker 01:
Under 337 G1, which the government likes to rely upon, suggesting there's a presumption.

[00:05:49] Speaker 04:
Why don't you break it down point by point?

[00:05:51] Speaker 04:
Your changed circumstance, one, is that you got a ruling that your product didn't infringe.

[00:05:57] Speaker 01:
Correct.

[00:05:57] Speaker 01:
That's one chain circumstance.

[00:05:59] Speaker 04:
And the answer to that from the point of view of the decision maker here was we don't grant rescission orders based on that.

[00:06:08] Speaker 04:
You can't point to one where we've done it.

[00:06:10] Speaker 04:
So we don't think in exercising our discretion, we don't think we're going to grant that relief.

[00:06:16] Speaker 01:
With respect to that, your honor, they have done it.

[00:06:18] Speaker 01:
That's part of the problem is the inconsistency that's being applied by the government here.

[00:06:23] Speaker 01:
There's inconsistency across the board.

[00:06:25] Speaker 01:
We cited in our brief,

[00:06:26] Speaker 01:
And in fact the Commission admitted that there are a number of cases where in a non-infringement finding by a district court they did in fact grant rescission as well as in cases of invalidity.

[00:06:37] Speaker 01:
And there is really no reason to treat those two differently.

[00:06:39] Speaker 01:
You've got a federal court that has found that these claims do not apply and in that situation that is justification for a changed circumstance which should mandate that the Commission should rescind those orders.

[00:06:52] Speaker 01:
We cited cases on both the non-infringement and the invalidity.

[00:06:56] Speaker 01:
And now, since June of this past year, we have the federal court not only finding that they're not infringed, but claims 8 and 19 are invalid as well.

[00:07:07] Speaker 01:
And we went back to the commission and say, well, look, now we've got invalidity, which you admitted was a changed circumstance.

[00:07:12] Speaker 01:
Resend them at this point.

[00:07:14] Speaker 01:
And their response was to not do that.

[00:07:16] Speaker 00:
Well, wait.

[00:07:16] Speaker 00:
If you can rely on district court's determination of invalidity, what happens if that's reversed on appeal here?

[00:07:22] Speaker 00:
If you're saying to the government, because the district court has determined these patents are invalid, you need to go ahead and rescind it.

[00:07:29] Speaker 00:
What happens if we reverse that on appeal?

[00:07:32] Speaker 04:
Well, then if the parties feel like that they are so... If they'd given you the permanent rescission, they would say, well, we're taking that back and we're reinstating the rescission order.

[00:07:41] Speaker 01:
Or leave it to the complainant underneath to go and start it again.

[00:07:44] Speaker 04:
And they said, well, just wait and see.

[00:07:47] Speaker 04:
Well, but again, the wait and see is... They said, well, wait and see.

[00:07:51] Speaker 04:
The problem, though, Your Honor, is that the prejudice... Say to a defaulting party who really has no standing at all will be very generous and will give you a temporary suspension, rescission order.

[00:08:02] Speaker 01:
But that's not good enough.

[00:08:03] Speaker 01:
It creates the cloud and the prejudice that we outlined in our briefing and talked about here.

[00:08:07] Speaker 01:
I mean, think of the public policy.

[00:08:09] Speaker 01:
You've got claims now of a patent which have been found not infringed.

[00:08:14] Speaker 01:
that have been found invalid in which this court affirmed all the other independent claims lack.

[00:08:18] Speaker 04:
What did the commission mean when they said, moreover, you intentionally default as matter of strategy and you suffer a consequence of that choice, they drop a footnote that says, in circumstances like this, you simply just don't have any standing to complain.

[00:08:33] Speaker 04:
For me, the elephant in your room is your default status.

[00:08:37] Speaker 04:
You've thumbed your nose at the commission.

[00:08:41] Speaker 04:
You did it.

[00:08:42] Speaker 04:
Contumaciously, you didn't even bother to reply to the adversary's motion seeking to put you in default.

[00:08:52] Speaker 04:
So you utterly thumbed your nose at the commission's authority in this case.

[00:08:58] Speaker 04:
Right?

[00:08:59] Speaker 04:
And in the price for that, the commission's saying, I'm sorry, we're not going to grant you the relief you asked for.

[00:09:06] Speaker 04:
What's wrong with the commission saying that?

[00:09:09] Speaker 01:
Well, several things, Your Honor.

[00:09:11] Speaker 01:
337K expressly provides that even in defaulting situations, during an enforcement proceeding, that my client is entitled to go and rigorously defend its position, which includes the fact that because there's no domestic... Does the language of that statute say, even in defaulting circumstances?

[00:09:30] Speaker 01:
It doesn't preclude defaulting circumstances, and it's been applied several times... Will you make it sound as if it says, even in defaulting circumstances?

[00:09:38] Speaker 01:
It doesn't, Your Honor, and I'll cite to the inconsistency of certain motorized self-balancing vehicles.

[00:09:43] Speaker 04:
In the language of K, read me in the language of K, where it says in K that even if you're a defaulting party, the commission will treat you as though you weren't.

[00:09:54] Speaker 01:
I can pull that up, Your Honor.

[00:09:56] Speaker 01:
I don't think it says one way or the other.

[00:09:57] Speaker 04:
You left the impression with me that you think that's what the statute said.

[00:10:02] Speaker 01:
If I left the impression that it specifically accepted or included defaulting parties, I didn't mean to say that.

[00:10:07] Speaker 04:
Well, you're saying they left that impression.

[00:10:09] Speaker 01:
Okay.

[00:10:09] Speaker 01:
What I'm saying, though, is that my understanding is that 337K as well as... There's nothing in it that expressly excludes... One way or the other.

[00:10:16] Speaker 01:
That's correct, Your Honor.

[00:10:17] Speaker 04:
And the understanding that the law, if you take footnote... What note was it I said?

[00:10:24] Speaker 04:
Footnote 27, and you do a little deep research behind that, you'll find that throughout the judicial system,

[00:10:31] Speaker 04:
Defaulting parties don't have any luck when they come back asking for a real 60 type relief What are you relying on in?

[00:10:39] Speaker 02:
337k is it k2b?

[00:10:47] Speaker 02:
Which case it says relief may be granted and you've got partial relief And for the reasons outlined your honor that partial relief is insufficient

[00:10:59] Speaker 01:
If I may, part of the point is during this precision proceeding that was rigorously disputed by our client, pointed out that there is an inconsistency here because the commission in, for example, motorized self-balancing vehicles in a nearly identical situation just a month before had found in a situation where there's both defaulting and non-defaulting parties and the issue of domestic industry came up, which they are bound to follow and find in any case

[00:11:30] Speaker 01:
They found, because the metric industry wasn't found there, they applied that to the defaulting parties.

[00:11:35] Speaker 01:
Defaulting parties that are hailed back into a subsequent enforcement proceeding still have rights, even though they were defaulting before.

[00:11:43] Speaker 01:
And part of those rights are they can challenge and say, for any reasons, either there's a changed circumstance, as there was here,

[00:11:50] Speaker 01:
Findings of non-infringement and invalidity.

[00:11:52] Speaker 00:
Speaking of that, you had mentioned a few minutes ago that with respect to change circumstances, there are cases where we've applied that in a non-infringement as opposed to an invalidity determination.

[00:12:03] Speaker 00:
And I guess I thought the cases you had cite really all dealt with where you showed that the commission rescinded its orders.

[00:12:12] Speaker 00:
It was always based on invalidity or unenforceability.

[00:12:15] Speaker 00:
Am I wrong about my reading of those cases?

[00:12:18] Speaker 01:
Your Honor.

[00:12:19] Speaker 01:
With due respect, we did cite agricultural vehicles, which was a 487 investigation, wire electrical discharge, which was a 290 investigation.

[00:12:30] Speaker 01:
There were several situations where we sent a remedial orders with respect to products where there was infringement as opposed to invalidity involved in those situations.

[00:12:39] Speaker 01:
We're saying that the distinction between invalidity and non-infringement findings by a district court

[00:12:46] Speaker 01:
or on remand or in any situation should not be treated differently.

[00:12:49] Speaker 01:
It's a changed circumstance.

[00:12:51] Speaker 01:
It's a situation, if you throw in the public policy considerations, which is why is there an order that's continuing right here where, under the circumstances, the claims are either not infringed or invalid?

[00:13:03] Speaker 01:
Where's the public policy?

[00:13:04] Speaker 01:
Where's the protection of not only my client, but of the public and good?

[00:13:09] Speaker 00:
Your Honor, I think I'm into my republic.

[00:13:12] Speaker 01:
Thank you.

[00:13:20] Speaker 03:
Good morning, Chief Judge, and may it please the court.

[00:13:23] Speaker 03:
If I can, I think I'd like to start with just a couple of points and characterizations of the cases that counsel just made, and then I'll explain if I can the relevance of the pending district court appeal in this court, and then I'd like to talk about standing.

[00:13:41] Speaker 03:
To the best of my knowledge, there are no non-infringement decisions concerning Rule 60 that have been cited here.

[00:13:47] Speaker 04:
when the chief judge just... What about the cases he just named?

[00:13:50] Speaker 03:
The cases that he just named, Agricultural Vehicles, was a commission case that involved this court's reversing the commission.

[00:13:58] Speaker 03:
And on remand from this court, the commission applied the circuit's holding.

[00:14:05] Speaker 03:
So there was a remand after a direct appeal.

[00:14:09] Speaker 03:
There was not some ancillary proceeding for enforcement or modification.

[00:14:12] Speaker 03:
Was it infringement or was it invalid?

[00:14:15] Speaker 03:
It was infringement, but it was a direct appeal.

[00:14:16] Speaker 03:
It was just a simple law of the case issue.

[00:14:19] Speaker 03:
A case went up for direct appeal.

[00:14:20] Speaker 03:
This court reversed the commission's findings of infringement, and the case came back to the commission for further fact finding.

[00:14:28] Speaker 03:
We, of course, apply the court's orders at a judgment when matters come back to us on remand.

[00:14:35] Speaker 03:
It's not an issue of a collateral proceeding years later by a defaulting party.

[00:14:40] Speaker 03:
Wire electrical discharge, that's a case where

[00:14:45] Speaker 03:
where the accused infringer did worse than Echo did here.

[00:14:49] Speaker 03:
That's a case where there was an intervening district court finding of non-infringement that came up while the enforcement proceeding was going on.

[00:14:57] Speaker 03:
I don't think there was a defaulting party there.

[00:14:59] Speaker 03:
I'd have to look.

[00:15:00] Speaker 03:
And what the commission did in that case is the commission dismissed the enforcement complaint without prejudice to refile.

[00:15:08] Speaker 03:
In this case, with respect to the enforcement complaint, Echo substantially prevailed as to its actual conduct

[00:15:14] Speaker 03:
that it was engaged in, the Commission found that that wasn't a violation of Section 337.

[00:15:19] Speaker 03:
So neither agriculture vehicles nor the wire electrical discharge case that Council just cited supports Council's position.

[00:15:32] Speaker 03:
As to the pending appeal in this Court, if this Court upholds the finding of invalidity, the case goes away.

[00:15:44] Speaker 00:
We filed, as soon as we could last August, a notice with- Well, your friend seems to suggest that there's some ambiguity in terms of what you may or may not do if validity is affirmed.

[00:15:55] Speaker 00:
I'm looking back at the 28-J letter.

[00:15:57] Speaker 03:
I'm not sure I recall- I think, respectfully, I think that that's a little bit feigned.

[00:16:01] Speaker 03:
I think the argument would be that the commission would choose to suspend the operation of its orders while there's a district court finding of invalidity.

[00:16:08] Speaker 03:
But if this court finds the patent invalid, the commission is going to suddenly

[00:16:14] Speaker 03:
find that the patent should be enforced.

[00:16:18] Speaker 03:
That doesn't make sense on its face.

[00:16:20] Speaker 03:
It doesn't make sense.

[00:16:20] Speaker 04:
Presumably the reason why the commission entered the order temporarily suspending was because they saw this possibility that we would affirm.

[00:16:29] Speaker 03:
Yeah, and that's exactly... Why else would they have done that?

[00:16:33] Speaker 03:
Yeah, that's what happened.

[00:16:34] Speaker 03:
It makes sense.

[00:16:35] Speaker 03:
It makes sense, and in the cases cited in the appellant's brief going all the way back to SSIH, going back

[00:16:41] Speaker 03:
through the early 1980s to the beginning of this court.

[00:16:43] Speaker 03:
That's been the commission's practice.

[00:16:46] Speaker 03:
In this case, after the district court, and it's not part of the record here.

[00:16:49] Speaker 03:
It was afterward.

[00:16:50] Speaker 03:
But after the district court found the patent claims invalid for obviousness, we got a petition to rescind the order.

[00:16:57] Speaker 03:
And the patentee said, well, we don't object so long as you take into account the possibility that if it gets reversed.

[00:17:04] Speaker 00:
OK, so your friend argues that there's no policy distinction to be drawn between a finding of invalidity and a finding of non-infringement.

[00:17:11] Speaker 03:
Well, we respectfully disagree.

[00:17:13] Speaker 03:
The difference is that once a patent is found invalid, there's no way to infringe it.

[00:17:19] Speaker 03:
Whereas what we're dealing with here with respect to infringement or non-infringement are the specific products that the appellant is bringing into the United States and the mental state in connection with that.

[00:17:32] Speaker 03:
If the appellant wants to, for example, change its product so that it has a long and narrow passageway, that doing so would improve its products

[00:17:41] Speaker 00:
Or if it's stipulated that there's no dispute that the products that are being imported are the same products that were found on in French.

[00:17:49] Speaker 03:
Well, but the point of the exclusion order is, and this is something that the ALJ mentions at page 3636 of the appendix, mere compliance with remedial order doesn't mean that you get rid of it.

[00:18:01] Speaker 03:
So to this point, right now we know from, we know right now that it's a likelihood of future

[00:18:09] Speaker 04:
infringement is sufficient to leave an order in place?

[00:18:14] Speaker 03:
The possibility of it is certainly sufficient to leave an order in place, at least when you've got a tactical default, as what happened here.

[00:18:22] Speaker 04:
What we have here also that we have to remember is that in the proceedings that are on review, would the likelihood of future infringement be sufficient to leave an order in place for a perfect

[00:18:40] Speaker 04:
a litigant, someone who appeared and cooperated, and how important is it that we have a defaulter here?

[00:18:49] Speaker 03:
I don't know the answer to that.

[00:18:50] Speaker 04:
I know that Rule 60... You just said that, just a second ago.

[00:18:53] Speaker 03:
Well, Rule 60 commits these things to the commission's work, to a district court's discretion.

[00:18:58] Speaker 03:
Congress certainly intended the commission expressly to have the same discretion as a district court.

[00:19:04] Speaker 03:
We don't have these cases involving defaulters very often.

[00:19:07] Speaker 03:
We have a long history going back to SSIH in 1983.

[00:19:10] Speaker 04:
The commission's order made it sound as if they sort of have a policy of not suspending or getting rid of orders where there's been a finding of non-infringement as to a particular party.

[00:19:25] Speaker 03:
To the best of my knowledge, the commission has never done that.

[00:19:30] Speaker 03:
And maybe even more importantly, a district court has never done that.

[00:19:33] Speaker 03:
We haven't found a single case.

[00:19:34] Speaker 03:
And appellants have never pointed to any.

[00:19:37] Speaker 04:
The history of enforcement orders over the years, right?

[00:19:43] Speaker 04:
I mean, you have an institutional modeling of all kinds of enforcement challenges that are brought.

[00:19:50] Speaker 04:
And if a challenge is brought and is determined that the product in question is not infringing, then the enforcement effort fails, right?

[00:19:57] Speaker 04:
Then the enforcement effort fails, but the... And typically, do the parties then seek to have the order revoked?

[00:20:05] Speaker 03:
Parties don't seek to have the order revoked.

[00:20:07] Speaker 03:
When their actual conduct is protected by a finding that that conduct doesn't infringe, revocation of the orders tantamount to seeking an advisory opinion.

[00:20:16] Speaker 03:
We'd like to do whatever we want based on the fact that our current conduct doesn't infringe.

[00:20:20] Speaker 04:
That's what I'm trying to get, whether it's customary policy simply to leave an order in place, even though it's been determined that particular goods that have been challenged in an enforcement proceeding don't infringe.

[00:20:33] Speaker 03:
That's exactly right, because there could be other goods.

[00:20:35] Speaker 03:
There could be other goods imported at that same time.

[00:20:38] Speaker 03:
There could be other goods imported a couple years from now.

[00:20:42] Speaker 03:
What I'm hearing from counsel is that they don't like the cloud or the fog, I think may have been the language that was used, of the default judgment standing out there.

[00:20:53] Speaker 03:
But that's the risk that they took when they defaulted.

[00:21:00] Speaker 03:
The conduct, there are three types of conduct that have been at issue here, and if I can just get through that, maybe that'll help clarify stuff.

[00:21:07] Speaker 03:
In 2014, ECHO brought the entire pods into the United States, and they defaulted in commission proceedings, and the commission's default then found, therefore, that those pods, which were imported entirely from China, were infringing.

[00:21:27] Speaker 03:
By 2016,

[00:21:29] Speaker 03:
ECHO was importing only its screens and rubber or silicone O-rings.

[00:21:35] Speaker 03:
It was doing all of its plastic manufacture in the US.

[00:21:38] Speaker 03:
And this entire enforcement and modification proceeding was about whether that conduct, whether merely importing the O-ring and the screen would violate the order.

[00:21:47] Speaker 03:
And the commission found that it wouldn't.

[00:21:49] Speaker 03:
The commission said there's no violation as to that.

[00:21:51] Speaker 03:
You have a good faith belief of non-infringement.

[00:21:54] Speaker 03:
And that determination is not on appeal.

[00:21:57] Speaker 03:
But it benefited ECHO.

[00:21:59] Speaker 03:
Now, for Echo to be aggrieved, Echo would now have to argue by declaration, as this court requires, at the earliest possible opportunity, as this court also requires, that it would actually like to go back to bringing all this stuff in from China, that it would like to go back to doing all of the plastic molding in the United States.

[00:22:20] Speaker 03:
But that's just simply not supported by the record here.

[00:22:23] Speaker 03:
It's not supported in the opening brief, which touts the domestic manufacturer.

[00:22:27] Speaker 03:
It's not supported

[00:22:28] Speaker 03:
in the declarations of record here.

[00:22:31] Speaker 03:
I mean, we have a declaration of ECHO's president when he says at appendix page 2105, we wanted to manufacture the plastic stuff domestically.

[00:22:41] Speaker 03:
At appendix page 2111, question and answer 79, it's good to have redundancy of suppliers.

[00:22:48] Speaker 03:
At appendix page 2114, question and answer 89, we were going to bring the plastic capsule production back to the United States while the original ITC investigation was still going on.

[00:22:59] Speaker 03:
So as to the conduct that Echo actually engages in and has demonstrated through the sworn declaration of its president that it intends to engage in, all of that activity is protected, even putting to the side the fact that the commission orders aren't even enforced because of a later determination of invalidity.

[00:23:18] Speaker 03:
So there is no threat of harm here, much less in a way that would be substantiated by Echo to support standing

[00:23:27] Speaker 03:
even independent of the subsequent invalidity.

[00:23:30] Speaker 03:
So the status of 18-2215, Echo and Rivera's appeal, is that it's in the middle of briefing.

[00:23:39] Speaker 03:
It's one of these cross-appeals with two rounds of briefing.

[00:23:43] Speaker 03:
This court will get that case off its books in the better part of a year.

[00:23:46] Speaker 03:
We don't think that the court needs to wait that long to take this case off of its docket.

[00:23:54] Speaker 00:
Let's assume we disagree with you on standards.

[00:23:57] Speaker 00:
What do we do with respect to the temporary rescission?

[00:24:01] Speaker 00:
I mean, you haven't asked that we would stay for us to stay this appeal to see what the outcome is.

[00:24:07] Speaker 00:
It's a different case, is it not, whether or not we affirm the invalidity determination?

[00:24:13] Speaker 03:
It's a different case.

[00:24:15] Speaker 03:
But since the commission's orders aren't in place, it's not like the commission is adversely affected by this court's.

[00:24:22] Speaker 00:
Yeah, but what if we reverse on the validity?

[00:24:27] Speaker 00:
How do we decide this case beforehand and then come back?

[00:24:32] Speaker 00:
File again?

[00:24:33] Speaker 00:
I mean, what happens if we were to reverse invalidity?

[00:24:36] Speaker 03:
If you were to reverse invalidity and you would also have to uphold, you have to reverse on infringement also, I think in that case.

[00:24:50] Speaker 03:
If you were to do all of that,

[00:24:56] Speaker 03:
Well, the infringement is still in front of us.

[00:24:58] Speaker 03:
The infringement is in front of you in 2215.

[00:25:00] Speaker 03:
2215 being the appeal.

[00:25:04] Speaker 03:
Sorry, the district court, the direct appeal from the district court proceeding has all of these issues, the claim construction of passageway, whether that is infringing or not.

[00:25:16] Speaker 04:
In this case, that's a final decision.

[00:25:18] Speaker 03:
That's a final decision.

[00:25:19] Speaker 04:
The final decision to wrap up for the whole procedure.

[00:25:21] Speaker 03:
The wrap up for the whole thing.

[00:25:22] Speaker 03:
And you've got both parties having all their arguments.

[00:25:25] Speaker 03:
And the patentee challenged the finding of non-infringement and also challenged the finding.

[00:25:32] Speaker 04:
Well, if we reversed across the board, let's start all over again.

[00:25:36] Speaker 03:
If you reversed across the board, yeah, we would be starting all over again.

[00:25:42] Speaker 00:
But what does that mean?

[00:25:43] Speaker 00:
I mean, so we take care of this case again.

[00:25:46] Speaker 04:
Let's assume we... Well, it means Echo is in the deep duty.

[00:25:50] Speaker 03:
Well, Echo, at that point, the patent claims would not be invalid.

[00:25:53] Speaker 03:
At that point, its good faith belief of non-infringement would no longer hold because its basis... They would have been found to infringe.

[00:26:01] Speaker 03:
They would have been found to infringe.

[00:26:02] Speaker 03:
Their basis for not infringing was the shape of a passageway.

[00:26:07] Speaker 03:
So at that point, yeah, they would be potentially liable in another enforcement proceeding.

[00:26:12] Speaker 03:
if they were bringing in products into the United States.

[00:26:15] Speaker 03:
What I didn't get to a couple minutes ago, and I see I only have two minutes left, is in its reply brief on standing, Echo talks about the 37 cent cost of bringing O-ring production and screens back into the United States.

[00:26:28] Speaker 03:
That's completely irrelevant, because what the commission adjudicated here was the importation of those components.

[00:26:35] Speaker 03:
Echo can bring all that stuff into the United States.

[00:26:37] Speaker 03:
It's entitled to import it.

[00:26:38] Speaker 04:
Well, whether it's bringing it or not, what Echo is trying to do is to get the order entirely eliminated so that they will not be exposed to any exclusion order at all.

[00:26:52] Speaker 04:
They're temporarily, they have a temporary order that's protecting them at the moment.

[00:26:56] Speaker 04:
But they say, I want, I'm still, I want, my relief I want is to get rid of the permanent order.

[00:27:03] Speaker 04:
So it seems to me that they have standing to ask for that relief.

[00:27:08] Speaker 04:
And if that relief is bigger and better than what's there now, and so they have standing to proceed.

[00:27:14] Speaker 03:
OK.

[00:27:15] Speaker 03:
What I would say is that for the actual conduct that ECHO engages in, whether if it's domestic manufacture of everything, the commission isn't even involved.

[00:27:22] Speaker 03:
You don't go pass go.

[00:27:24] Speaker 00:
Yeah, but the existence of the remedial orders, if they're in place,

[00:27:30] Speaker 00:
The appellants here don't have the ability to import certain items, right?

[00:27:35] Speaker 03:
Only they don't have the ability to import the plastic.

[00:27:38] Speaker 03:
Their business is restricted.

[00:27:42] Speaker 03:
In a way that doesn't affect them, because in the declaration here, they've said, we wanted to do this domestically.

[00:27:47] Speaker 03:
But if we could just put, I have less than 30 seconds left.

[00:27:51] Speaker 03:
There are a couple of things I just want to clarify.

[00:27:52] Speaker 00:
No, no, no.

[00:27:53] Speaker 00:
Don't worry about the clock so much.

[00:27:55] Speaker 00:
Just answer our questions.

[00:27:56] Speaker 00:
That's not a reason to not.

[00:27:57] Speaker 00:
So they cannot.

[00:28:00] Speaker 00:
perform, they cannot import certain things.

[00:28:02] Speaker 00:
Just because they said, well, right now, we'd rather do that, they are constrained by the remedial order in terms of what they have the ability to import, right?

[00:28:14] Speaker 03:
Yes.

[00:28:14] Speaker 03:
They cannot import the plastic that they proudly manufacture in the United States.

[00:28:20] Speaker 00:
You're saying that they don't have standing to challenge this because they've told us that they really don't have any plans or are not currently importing something that would be

[00:28:30] Speaker 00:
bumping up against their medial order.

[00:28:32] Speaker 03:
Correct.

[00:28:32] Speaker 00:
If this court finds that... But it still constrains them, does it not?

[00:28:38] Speaker 00:
What if tomorrow they change their minds?

[00:28:40] Speaker 00:
They're still constrained.

[00:28:42] Speaker 00:
They haven't signed in blood that they never have any intent and they're never going to be in a position of wanting to import certain items that are included in the media.

[00:28:51] Speaker 03:
I mean, that's the definition of an advisory opinion.

[00:28:53] Speaker 03:
The question isn't whether they might do it.

[00:28:55] Speaker 04:
The question is whether now, as they come here... Well, they're saying that the conduct that you say is barring them from being able to gain relief, they're saying we took that in order so we wouldn't be in trouble.

[00:29:05] Speaker 04:
Well, actually... We took that act because of the outstanding order.

[00:29:10] Speaker 03:
That's actually not what the opening brief says, and it's also not what... Now, that would have been a good argument for them to make in this case.

[00:29:17] Speaker 03:
But if you look at pages 2105 through 2114 of the appendix, which is the declaration of their expert, that wasn't their position.

[00:29:26] Speaker 03:
Their position that they have on the record here was that they were going to bring the plastics into the United States anyway, and that they proudly did it.

[00:29:34] Speaker 03:
And that's what their opening brief says.

[00:29:36] Speaker 03:
In the reply brief, they flip their story.

[00:29:38] Speaker 03:
They don't do it with the declaration.

[00:29:40] Speaker 03:
They don't do it in any tangible, concrete way.

[00:29:45] Speaker 03:
If I could have one minute, just to thank you.

[00:29:50] Speaker 03:
On the merits here with respect to the different patent claims that were at issue, the responding party in this case, Solofill, never challenged the validity of claims 1 and 10 for the domestic industry.

[00:30:03] Speaker 03:
Domestic industry isn't a jurisdictional requirement.

[00:30:07] Speaker 03:
And the commission found consonant with Lanham and now with Laerdal in connection with the defaulter.

[00:30:14] Speaker 03:
that the commission wasn't going to challenge the allegations.

[00:30:17] Speaker 04:
That's why I asked whether 1 in 10 were involved in the district court action.

[00:30:21] Speaker 04:
What's that?

[00:30:22] Speaker 04:
1 in 10 are the basis for continuing to find a domestic industry, right?

[00:30:27] Speaker 03:
1 in 10 were the basis for the domestic industry.

[00:30:29] Speaker 04:
And that's why I asked in the very beginning whether 1 in 10 were up for grabs in the district court action.

[00:30:35] Speaker 03:
And 1 in 10 was, the district court action is a declaratory judgment if they're not at issue.

[00:30:39] Speaker 04:
Doesn't affect 1 in 10.

[00:30:41] Speaker 03:
It doesn't affect 1 in 10, but it's Echo who was the

[00:30:44] Speaker 03:
declaratory plaintiff.

[00:30:45] Speaker 03:
It's their fault.

[00:30:46] Speaker 03:
I mean, keep in mind... Well, that's what I mean.

[00:30:48] Speaker 04:
But I mean, the district court action will have no effect on the domestic industry issue as decided by the commission as we see it right now.

[00:30:56] Speaker 03:
I believe that to be true.

[00:30:59] Speaker 03:
But they also can't infringe if 8 and 19 are finally found to be invalid.

[00:31:03] Speaker 03:
That's true.

[00:31:04] Speaker 03:
I think the last point I would make, and I really appreciate the Chief Judge's indulgence, is that we are not aware of a case involving, as I said before,

[00:31:14] Speaker 03:
a district court's elimination of its final judgment based on non-infringement.

[00:31:20] Speaker 03:
More than that, in the cases involving invalidity and unenforceability, we're not aware of a district court determination to eliminate its orders after all the appeals have run.

[00:31:33] Speaker 03:
You've got cases like Mendenhall and Thompson-Hayward, which when one proceeding is on appeal,

[00:31:41] Speaker 03:
This court will allow a party to take advantage of a subsequent district court invalidity determination or unenforceability determination.

[00:31:48] Speaker 03:
The commission order here became final in 2016.

[00:31:51] Speaker 03:
No appeal was taken.

[00:31:53] Speaker 03:
This is merely a collateral attack on the commission's default finding and is precluded by this court's nasal off decision.

[00:31:59] Speaker 03:
Thank you.

[00:32:00] Speaker 03:
Thank you.

[00:32:06] Speaker 00:
Thank you, Your Honor.

[00:32:08] Speaker 00:
What the commission?

[00:32:08] Speaker 00:
Well, you got the answer.

[00:32:10] Speaker 00:
that I assume you wanted from the government, which is that if the invalidity determination of the district court is affirmed on appeal, we're done.

[00:32:21] Speaker 01:
Finally, yes.

[00:32:22] Speaker 01:
If we can take that to the bank, then we did.

[00:32:24] Speaker 01:
But that still doesn't change the fact.

[00:32:26] Speaker 01:
What the Commission is asking for is an open-ended approach which violates Lear v. Atkins and everything else that's ever been going on right here.

[00:32:33] Speaker 01:
There is no domestic industry.

[00:32:34] Speaker 01:
The Commission has an obligation

[00:32:37] Speaker 01:
to find domestic industry.

[00:32:38] Speaker 01:
The ALJ below found there was no domestic industry.

[00:32:42] Speaker 01:
The commission refused to say one way or the other.

[00:32:45] Speaker 01:
It cannot then rely upon any presumption due to the defaulting underneath to continue these remedial orders at this time.

[00:32:53] Speaker 01:
Recision is the only option.

[00:32:55] Speaker 01:
There was no basis.

[00:32:56] Speaker 01:
337G does not apply in a situation as here.

[00:33:00] Speaker 01:
And Lairdahl and all the others are distinguishable.

[00:33:02] Speaker 01:
Where you have both non-defaulting and defaulting partners.

[00:33:04] Speaker 04:
But by default, you agreed that claims one and ten are in play.

[00:33:08] Speaker 01:
Sorry?

[00:33:08] Speaker 04:
By default, you agreed that claims one and ten are in play in the proceeding.

[00:33:14] Speaker 01:
In this proceeding, yes, but there was no domestic industry that was found with respect to those.

[00:33:19] Speaker 04:
We even was avert the averment.

[00:33:24] Speaker 04:
No, this... That those claims are there and that the patentee is practicing those claims is in the records.

[00:33:31] Speaker 01:
The ALJ found that not to be the case, and this commission neither found that one way or the other.

[00:33:36] Speaker 01:
There is no presumption of domestic industry in this case.

[00:33:40] Speaker 01:
Even if this court were to hold that 337G1 applies, which for the reasons we outline, we don't believe it does, there is no presumption.

[00:33:48] Speaker 01:
A lack of a finding does not amount to a finding that can be presumed for this court to review on appeal.

[00:33:54] Speaker 01:
For that reason,

[00:33:55] Speaker 01:
there there's an obligation from the commission below to find domestic industry and it failed to find that here now remember claims five and eighteen were both held invalid for lack of written description affirmed by this court which has their identical language never challenged by you not even challenged by you in the district court written description that that's you made a challenge but oh you were a little Johnny come lately that that's true and acknowledged certainly true that's true and acknowledged

[00:34:24] Speaker 04:
contumaciously defaulting in front of the commission, John income lately in the district court.

[00:34:30] Speaker 04:
And yet you're arguing that we should somehow take the lack of written description as to some claims and warp it on, put it on the others.

[00:34:38] Speaker 01:
Your honor, uh, clients have warts and they come in all shapes and sizes, but what cannot be disputed is that during the enforcement proceeding where they were able to and did rigorously challenge this.

[00:34:50] Speaker 01:
Sorry.

[00:34:52] Speaker 04:
You won in the enforcement procedure.

[00:34:54] Speaker 01:
But we didn't win.

[00:34:55] Speaker 01:
We still have this cloud that's hanging over it and crushing their ability to do what they want to do, whether that's import or not import.

[00:35:01] Speaker 04:
The enforcement proceeding is not about the cloud.

[00:35:03] Speaker 04:
The rescission order is about the cloud.

[00:35:06] Speaker 04:
And in the enforcement proceeding, you walked away with a win.

[00:35:10] Speaker 01:
But without removing the rescission or medial order.

[00:35:13] Speaker 04:
So my point is that what happened in the enforcement proceeding is overdone and you don't have any grounds to complain about that.

[00:35:21] Speaker 01:
We do, Your Honor.

[00:35:22] Speaker 01:
In fact, this appeal that we're at right here is from the ALJ that found no domestic industry, said that the order should be rescinded.

[00:35:29] Speaker 01:
The commission then refused to consider the domestic industry, didn't rule one way or the other.

[00:35:34] Speaker 01:
That's what this appeal is from.

[00:35:35] Speaker 04:
We're saying that they were mandated... Your time to raise that was in the enforcement proceeding.

[00:35:41] Speaker 01:
We did, Your Honor.

[00:35:43] Speaker 01:
You weren't in the... In the enforcement proceeding, we did petition to have them rescinded because of lack of domestic industry.

[00:35:49] Speaker 01:
And the commission denied that as well.

[00:35:52] Speaker 01:
And that's what part of this appeal.

[00:35:53] Speaker 04:
And the decision proceeding, not in the enforcement, they were consolidated.

[00:35:56] Speaker 01:
They were consolidated, right, your honor.

[00:35:58] Speaker 04:
So it's the same time.

[00:35:59] Speaker 00:
Final thought, time has expired.

[00:36:01] Speaker 01:
Final thought is, your honor, we respectfully request that you reverse below and rule in favor and remove this cloud over Echo, who is a Johnny-come-lately but has done its best as a small company to do what's right in this case.

[00:36:13] Speaker 01:
Thank you.

[00:36:14] Speaker 01:
We thank both sides for cases submitted.

[00:36:16] Speaker 00:
Thank you.