ITC rules for Navico in patent dispute - Trade Only Today

ITC rules for Navico in patent dispute

The ITC is also recommending that a federal appeals court deny Garmin’s request for a stay.
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The U.S. International Trade Commission denied a request by Garmin — which Garmin had sought until a federal judge could hear the company’s appeal — that would have allowed Garmin to continue importing technology the commission found to infringe on a competitor’s patent until arguments were heard.

The ITC is also recommending that a federal appeals court deny Garmin’s request for a stay — which would allow it to import sonar technology the ITC says infringes on Navico’s patented technology until its appeal to a modification recently issued is heard.

The case involves Garmin’s DownVü scanning sonar products.

Navico recently requested an “exclusion order” from the ITC, saying Garmin had separately packaged the components of its sonar technology to avoid violating the ITC’s initial ruling prohibiting Garmin’s importation of the products into the United States.

Navico asked the ITC to block the importation of the components as separate entities, which the ITC says Garmin then repackaged together after the components arrived in the United States from Taiwan, where they are made.

Both Navico and Garmin had maintained the ITC ruled in their favor; however, a public opinion issued by the ITC states it ruled in favor of Navico.

“Garmin treated the commission’s exclusion order like a nuisance,” the ITC wrote in its most recent public opinion denying Garmin a stay on the importation ban. “Instead of importing certain infringing sonar systems, it imported each system by separating the components into two plastic bags to circumvent the exclusion order.”

The company then put the two bags in the same box in the United States, and sold the “infringing boxed systems after importation,” the ITC wrote in its public opinion.

“When the commission put an end to Garmin’s charade and clarified that its exclusion order covered Garmin’s importation of the components separately for their combined sale after importation, Garmin brought this appeal,” the ITC opinion read.

Garmin acknowledged that the strong language in the ITC’s public opinion called its conduct “egregious.” But the company said the public document, issued on Sept. 8 regarding the stay request, was not a ruling, but merely argued why the commission thought the court should deny Garmin’s request for a stay.

Carly Hysell

Carly Hysell

Further, the opinion didn’t mention Garmin’s tilted redesign, said spokeswoman Carly Hysell. (Navico has said Garmin was required to submit any redesigned products for review and approval by the ITC, but it had not yet done so.)

“The ITC argument yesterday also confirmed our position that standalone products are fine,” Hysell told Trade Only, quoting from the opinion: “Components of infringing products are subject to exclusion, while ‘standalone’ components are permitted entry.”

“So everything we said in our original press release remains 100 percent accurate,” Hysell said.

Last week, the ITC issued a public opinion regarding the decision to grant the limited exclusion order, or LEO, that modified its original ruling that prohibited Garmin from importing its DownVü scanning sonar products.

“We granted Navico’s request to modify the exclusion order,” Megan Valentine, who is with the office of general council for the U.S. International Trade Commission, confirmed to Trade Only.

“Garmin's importation of transducers for the purpose of kitting an infringing device, rather than for individual sale of a standalone component, would be contrary to commission practice and would violate the purpose of the LEO,” the ITC wrote in its decision, which took the exclusion a step further and prohibited the import of the device as separate components.

“Garmin’s motion for a stay is unusually weak,” the commission wrote in Thursday’s public opinion. “For the same reasons that Garmin deserves no stay, Garmin is not entitled to an expedited appeal shortening the time for other parties to respond to Garmin’s brief.”

Navico CEO Leif Ottosson

Navico CEO Leif Ottosson

Garmin has appealed the denial of a stay as well as the ITC’s ruling that it infringed on Navico’s patents, and the ruling that it could not import the components separately.

A federal appeals judge will hear arguments, but no dates have been set, Valentine said. “We opposed Garmin’s motion, but the court has not yet ruled on it.”

Generally, if an exclusion order has been issued to Customs, importation of a device will be stopped, Valentine said. The importer then has several options to get the goods into the country.

It can ask Customs to determine whether the device falls under the exclusion. If a product is stopped by Customs and hasn’t been released within 30 days, the importer can file a claim to force Customs to make a determination whether the product is excluded from importation or not. If Customs decides it is excluded, the party can make an appeal to the International Trade Commission in New York, Valentine said.

If that entity upholds the determination by Customs, the importer can appeal to a federal circuit court in Washington, D.C. “There are a couple layers of review,” Valentine said. “If the importer fails at all levels and nobody says the product can come in, it doesn’t come in.”

“Garmin did not argue that Customs has excluded any of its products from entry, nor has Garmin availed itself of the numerous avenues for obtaining decisions from the commission or from Customs about any of its allegedly non-infringing redesign,” the ITC wrote in its opinion on Sept. 8.

On Dec. 1, 2015, the ITC ruled that Garmin’s DownVü scanning sonar products violated Navico’s patents for DownScan imaging technology. It was the second ruling within a month that found Garmin was violating sonar patents — Johnson Outdoors reported in November that a judge ruled that Garmin’s SideVü sonars violated Johnson Outdoors’ patents.

In July 2015, Humminbird won a ruling in a patent lawsuit regarding Garmin’s unlicensed use of its side scan sonar technology. In May of this year Garmin agreed to license the patents from Humminbird’s parent company, Johnson Outdoors.

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