Section 337, Tariff Act of 1930, Investigations of Unfair Practices in Import Trade
Under section 337, the USITC determines whether there is unfair competition in the importation of products into, or their subsequent sale in, the United States. Section 337 declares the infringement of a U.S. patent, copyright, registered trademark, or mask work to be an unlawful practice in import trade. Section 337 also declares unlawful other unfair methods of competition and unfair acts in the importation and subsequent sale of products in the United States, the threat or effect of which is to destroy or substantially injure a domestic industry, prevent the establishment of such an industry, or restrain or monopolize trade and commerce in the United States.
Section 337 investigations require formal evidentiary hearings in accordance with the Administrative Procedure Act (5 U.S.C. 551 et seq.). The hearings are held before an administrative law judge (ALJ). Parties to these investigations include complainants, respondents, and the USITC attorney representing the public interest. Following the evidentiary hearing, the ALJ issues an initial determination on all issues related to violations of section 337. The Commission may review and adopt, modify, or reverse the ALJ's decision. If the Commission does not review the initial determination, it becomes the USITC's decision. If a violation is found, the USITC may issue orders barring the importation of certain products into the United States. In addition to requesting long-term relief, complainants also may move for temporary relief pending final resolution of the investigation based on a showing of, among other things, irreparable harm in the absence of such temporary relief.
When: After receipt of a complaint alleging, under oath, a violation of section 337, the USITC determines whether the complaint satisfies the requirements of the Commission's rules and an investigation should be instituted. Following institution, the USITC conducts an investigation to determine whether the statute has been violated.
Duration: The USITC is required to conclude its investigation at the earliest practicable time, and must, within 45 days after an investigation is instituted, establish a target date for issuing its final determination.
Finding: If the accused imports are determined to infringe a valid and enforceable U.S. patent, copyright, registered trademark, or mask work, the USITC may issue orders excluding the products from entry into the United States and/or directing the violating parties to cease and desist from certain actions. Where such infringement is shown, injury need not be shown to establish a violation of section 337. In cases involving other unfair methods of competition or unfair acts, if the USITC finds that the importation of the accused articles substantially injures or threatens to substantially injure an industry, prevents the establishment of such an industry, or restrains or monopolizes trade and commerce in the United States, it may also issue exclusion and/or cease and desist orders. USITC orders are effective when issued and become final 60 days after issuance unless disapproved for policy reasons by the U.S. Trade Representative within that 60-day period. Appeals of USITC determinations may be taken to the U.S. Court of Appeals for the Federal Circuit. Violators of USITC section 337 orders are liable for civil penalties of up to $100,000 a day or twice the value of the imported articles. (For further information, see section 337 of the Tariff Act of 1930, 19 U.S.C. 1337.)