[Federal Register Volume 87, Number 198 (Friday, October 14, 2022)]
[Notices]
[Pages 62455-62456]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-22287]


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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1226]


Certain Artificial Eyelash Extension Systems, Products, and 
Components Thereof; Notice of the Commission's Final Determination 
Finding No Violation of Section 337; Termination of the Investigation

AGENCY: U.S. International Trade Commission.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the U.S. International Trade 
Commission (``Commission'') has found no violation of section 337 of 
the Tariff Act of 1930, as amended, in the above-captioned 
investigation. The investigation is terminated.

FOR FURTHER INFORMATION CONTACT: Lynde Herzbach, Office of the General 
Counsel, U.S. International Trade Commission, 500 E Street SW, 
Washington, DC 20436, telephone (202) 205-3228. 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 
[email protected]. 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: On October 28, 2020, the Commission 
instituted this investigation under section 337 of the Tariff Act of 
1930, as amended, 19 U.S.C. 1337 (``section 337''), based on a 
complaint filed by Lashify, Inc. of Glendale, California (``Lashify''). 
See 85 FR 68366-67 (Oct. 28, 2020). The complaint, as supplemented, 
alleges a violation of section 337 based upon the importation into the 
United States, sale for importation, or sale after importation into the 
United States of certain artificial eyelash extension systems, 
products, and components thereof by reason of infringement of certain 
claims of U.S. Patent Nos. 10,660,388 (``the '388 patent'') and 
10,721,984 (``the '984 patent''), and the sole claims of U.S. Design 
Patent Nos. D877,416 (``the D'416 patent'') and D867,664 (``the D'664 
patent''), respectively (collectively, the ``Asserted Patents''). The 
complaint also alleges the existence of a domestic industry. The notice 
of

[[Page 62456]]

investigation (``NOI'') names nine respondents, including: KISS Nail 
Products, Inc. of Port Washington, New York (``KISS''); Ulta Beauty, 
Inc. of Bolingbrook, Illinois; CVS Health Corporation of Woonsocket, 
Rhode Island; Walmart, Inc. of Bentonville, Arkansas (``Walmart''); 
Qingdao Hollyren Cosmetics Co., Ltd. d/b/a Hollyren of Shandong 
Province, China (``Hollyren''); Qingdao Xizi International Trading Co., 
Ltd. d/b/a Xizi Lashes of Shandong Province, China (``Xizi Lashes''); 
Qingdao LashBeauty Cosmetic Co., Ltd. d/b/a Worldbeauty of Qingdao, 
China (``Worldbeauty''); Alicia Zeng d/b/a Lilac St. and Artemis Family 
Beginnings, Inc. of San Francisco, California (collectively, 
``Lilac''); and Rachael Gleason d/b/a Avant Garde Beauty Co. of Dallas, 
Texas. Id. The Office of Unfair Import Investigations (``OUII'') is 
also a party to the investigation. Id.
    The Commission later amended the complaint and NOI to substitute 
CVS Pharmacy, Inc. of Woonsocket, Rhode Island (``CVS'') in place of 
named respondent CVS Health Corporation and Ulta Salon, Cosmetics & 
Fragrance, Inc. of Bolingbrook, Illinois (``Ulta'') in place of named 
respondent Ulta Beauty, Inc. See Order No. 10, unreviewed by Comm'n 
Notice (Feb. 10, 2021); see also 86 FR 9535 (Feb. 16, 2021).
    The Commission previously terminated the investigation as to claims 
2-4 and 7 of the '388 patent and claims 6-8, 12, 18-19, 25-26, and 29 
of the '984 patent based on Lashify's partial withdrawal of the 
complaint. See Order No. 24 (Apr. 23, 2021), unreviewed by Comm'n 
Notice (May 11, 2021). The Commission also previously terminated claims 
2-5, 10-11, 14, 17, 21-22, and 24 of the '984 patent from the 
investigation. See Order No. 38 (June 22, 2021), unreviewed by Comm'n 
Notice (July 6, 2021).
    The Commission previously terminated Rachael Gleason d/b/a Avant 
Garde Beauty Company from the investigation based on a Consent Order. 
See Order No. 28, unreviewed by Comm'n Notice (May 20, 2021).
    The Commission previously determined that Lashify failed to satisfy 
the technical prong of the domestic industry requirement for the '388 
patent, thus terminating that patent from the investigation. See Order 
No. 35, unreviewed by Comm'n Notice (July 9, 2021).
    Prior to the issuance of the final initial determination, the 
remaining respondents included: KISS, Ulta, CVS, Walmart, Hollyren, 
Xizi Lashes, Worldbeauty, and Lilac (collectively, ``Respondents'').
    On October 28, 2021, the presiding administrative law judge issued 
a final initial determination (``FID''), finding that no violation of 
section 337 has occurred in the importation into the United States, the 
sale for importation, or the sale within the United States after 
importation, of certain artificial eyelash extension systems, products, 
and components thereof. FID at 141-142. The FID finds that two accused 
products infringe the '984 patent and the'984 patent is not invalid, 
but also finds that Lashify has failed to satisfy the technical prong 
of the domestic industry requirement with respect to the '984 patent. 
The FID further finds that the D'416 patent and D'664 patent are 
infringed and not invalid, and that Lashify satisfied the technical 
prong with respect to both design patents. The FID further finds that 
Lashify has failed to satisfy the economic prong of the domestic 
industry requirement with respect to all of the Asserted Patents 
remaining in the investigation.
    On November 29, 2021, respondents KISS, Ulta, Walmart, and CVS 
filed a joint submission on the public interest pursuant to Commission 
Rule 210.50(a)(4) (19 CFR 210.50 (a)(4)). Lashify and OUII did not file 
a statement on the public interest. No submissions were received in 
response to the Commission notice seeking public interest submissions. 
86 FR 62844-45 (Nov. 12, 2021).
    On January 20, 2022, the Commission determined to review the FID in 
part. 87 FR 4044-46 (Jan. 26, 2022). Specifically for the '984 patent, 
the Commission reviewed the FID's findings regarding the technical 
prong of the domestic industry requirement and the FID's findings that 
the asserted claims of the '984 patent are not invalid as obvious. Id. 
at 4045. The Commission also reviewed the FID's findings regarding the 
economic prong of the domestic industry requirement. Id. The Commission 
asked the parties to address two questions related to the issues under 
review with respect to the economic prong of the domestic industry 
requirement. Id.
    On February 3, 2022, Lashify, Respondents, and OUII each filed an 
initial written response to the Commission's request for briefing. On 
February 10, 2022, Lashify, Respondents, and OUII each filed a reply 
submission.
    Having reviewed the record of the investigation, including the FID 
and the parties' submissions, the Commission has determined to find no 
violation of section 337 as to any Asserted Patent. Specifically, with 
respect to the '984 patent, the Commission has determined to: (1) 
affirm, with supplemental analysis, the FID's finding that Lashify has 
failed to satisfy the technical prong of the domestic industry 
requirement; and (2) take no position regarding whether claims 1, 9, 
23, and 27 of the '984 patent are invalid for obviousness under 35 
U.S.C. 103. The Commission has further determined to affirm, with 
supplemental reasoning, the FID's finding that Lashify failed to 
satisfy the economic prong of the domestic industry requirement for any 
of the Asserted Patents. Commissioners Karpel and Schmidtlein concur in 
the determination of no violation as to the '984 patent. However, they 
find a violation of section 337 as to the D'416 and D'664 patents. 
Specifically, they find that Lashify has satisfied the economic prong 
of the domestic industry requirement under subsection 337(a)(3)(B), but 
not under subsection 337(a)(3)(A), with respect to the D'416 and D'664 
patents. They take no position on subsection 337(a)(3)(C) with respect 
to the D'416 and D'664 patents, or on whether Lashify satisfies the 
economic prong for the '984 patent.
    The investigation is terminated with a finding of no violation of 
section 337. The Commission's reasoning in support of its 
determinations is set forth more fully in its opinion. The reasoning in 
support of the separate views of Commissioners Karpel and Schmidtlein 
is set forth in the Separate Views of Commissioners Karpel and 
Schmidtlein in Dissent on the Economic Prong of the Domestic Industry 
Requirement as to U.S. Design Patent Nos. D877,416 and D867,664, issued 
concurrently therewith.
    The Commission vote for this determination took place on October 6, 
2022.
    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).

    By order of the Commission.

    Issued: October 6, 2022.
Katherine Hiner,
Acting Secretary to the Commission.
[FR Doc. 2022-22287 Filed 10-13-22; 8:45 am]
BILLING CODE 7020-02-P