[Federal Register Volume 88, Number 132 (Wednesday, July 12, 2023)]
[Notices]
[Pages 44396-44399]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-14778]


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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1288]


Certain Playards and Strollers; Notice of a Commission 
Determination To Review in Part a Final Initial Determination Finding a 
Violation; Request for Written Submissions on the Issues Under Review 
and on Remedy, the Public Interest, and Bonding; Extension of Target 
Date

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 determined to review in part a final 
initial determination (``ID'') of the presiding administrative law 
judge (``ALJ''), finding a violation. The Commission requests written 
submissions from the parties on the issues under review and submissions 
from the parties, interested government agencies, and other interested 
persons on the issues of remedy, the public interest, and bonding, 
under the schedule set forth below. The Commission has also determined 
to extend the target date for completion of the investigation to August 
28, 2023.

FOR FURTHER INFORMATION CONTACT: Benjamin S. Richards, Esq., Office of 
the General Counsel, U.S. International Trade Commission, 500 E Street 
SW, Washington, DC 20436, telephone (202) 708-5453. 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: The Commission instituted this investigation 
by publication in the Federal Register on December 27, 2021. 86 FR 
73318 (Dec. 27, 2021). The complainants are

[[Page 44397]]

Graco Children's Products Inc., of Atlanta, GA (``Graco'') and 
Wonderland Nurserygoods Co., Ltd. of Taipei, Taiwan (``Wonderland''). 
Graco and Wonderland's complaint, as supplemented, 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, or 
the sale within the United States after importation of certain playards 
and strollers by reason of infringement of certain claims of U.S. 
Patent Nos. 9,706,855 (``the '855 patent''); 9,414,694 (``the '694 
patent''); RE43,919 (``the '919 patent''); and 6,979,017 (``the '017 
patent''). Id. The complaint further alleged that a domestic industry 
exists. Id. The Commission's notice of investigation named as 
respondents Baby Trend, Inc. of Fontana, CA (``Baby Trend''); Dongguan 
Golden Prosper Baby Products Co., Ltd., of Guangdong, China (``Golden 
Prosper''); Sichuan Hobbies Baby Products Co., Ltd., of Sichuan, China 
(``Sichuan Hobbies''); and Anhui Chile Baby Products Co., Ltd. of Anhui 
Province, China (``Anhui Chile''). Id. The Office of Unfair Import 
Investigations is not participating in the investigation. Id.
    On April 1, 2022, the Commission determined not to review an ID 
terminating the investigation as to the '017 patent. Order No. 7 (Mar. 
7, 2022), unreviewed by Comm'n Notice (Apr. 1, 2022). On April 12, 
2022, the Commission determined not to review an ID terminating the 
investigation as to respondent Golden Prosper based on withdrawal of 
the complaint. Order No. 8 (Mar. 23, 2022), unreviewed by Comm'n Notice 
(Apr. 12, 2022). And, on December 14, 2022, the Commission determined 
not to review an ID terminating the investigation as to claims 3-9, 11-
12, 14, and 16-20 of the '855 patent, claims 2, 4-9, 11-17, and 19-20 
of the '694 patent, and claims 8, 10-12, 14-19, and 27-28 of the '919 
patent as to all respondents, and terminating the investigation as to 
claim 20 of the '919 patent as to respondents Sichuan Hobbies and Anhui 
Chile (but not Baby Trend). Order No. 21 (Nov. 15, 2022), unreviewed by 
Comm'n Notice (Dec. 14, 2022).
    The ALJ held an evidentiary hearing from December 12-15, 2022, at 
which point, only claims 1, 2, 10, 13, and 15 of the '855 patent and 
claims 1, 10, and 18 of the '694 patent remained as to all respondents 
and claim 20 of the '919 patent remained as to respondent Baby Trend. 
At the time of the evidentiary hearing, there were three remaining 
respondents in this investigation: Baby Trend, Sichuan Hobbies, and 
Anhui Chile (``Respondents'').
    On March 31, 2023, the ALJ issued the final ID in this 
investigation. The ID found that a violation of section 337 has 
occurred based on the respondents' importation and sale of products 
that infringe certain claims of the '855 patent and the '694 patent. By 
contrast, the ID found that no violation has occurred in connection 
with the '919 patent. The ALJ issued his recommended determination 
(``RD'') on remedy and bond concurrently with the ID. The RD 
recommended issuance of a limited exclusion order (``LEO'') directed to 
accused products that infringe the '855 or '694 patents. In addition to 
the LEO, the RD recommended the issuance of a cease-and-desist order 
(``CDO''). As to bond, the RD recommended a bond rate of 4% for the 
product accused of infringing only the '919 patent and a bond rate of 
59% for the remaining accused products.
    The parties filed petitions for review of the ID on April 14, 2023, 
and responses thereto on April 24, 2023.
    Having reviewed the record of the investigation, including the 
final ID, the parties' submissions to the ALJ, and the petitions for 
review, the Commission has determined to review the ID in part. 
Specifically, the Commission has determined to review: (1) for the '855 
patent, whether claim 15 is anticipated by Gabriella, and whether 
claims 1, 2, 10, and 13 are obvious based on Troutman and Song or Hsia 
and Song; (2) for the '694 patent, whether claim 18 is anticipated by 
Hsia and whether claims 1 and 10 are obvious based on Troutman and 
Tharalson; (3) the '919 patent in its entirety; and (4) whether the 
technical and economic prongs of the domestic industry requirement are 
met for all three patents.
    In connection with its review, the Commission requests responses to 
the following questions. The parties are requested to brief their 
positions with reference to the applicable law and the existing 
evidentiary record.
    (1) Must the Commission identify a reason that an ordinary artisan 
would have been motivated to add legs like those claimed in claim 1 and 
10 of the '855 patent (such as those disclosed in Song) to the 
stationary bassinet of Troutman, as opposed to adding legs generally? 
See, e.g., ID at 64 (``I find that Respondents have established that a 
person of ordinary skill in the art would have been motivated to add 
legs to Troutman's infant support unit.''). Does the evidence of record 
demonstrate clearly and convincingly that such a motivation exists?
    (2) On page five (5) of their petition for review, Respondents 
identify ``[w]hether . . . Hsia anticipates . . . claim 18 of the '694 
Patent'' as an issue for review. Identify where, if anywhere, 
Respondents raised that issue in their pre- and/or post-hearing briefs 
before the ALJ? Did the ALJ address that issue?
    (3) What is the status of the Wonderland Nursery Goods Co., Ltd. v. 
Baby Trend Inc., Case No. 5:14-cv-01153-JWH-SP, district court 
decision? Is it a final decision? Has an appeal been filed? Must the 
Commission give the judgment preclusive effect with regard to 
invalidity under 35 U.S.C. 251?
    (4) Did Respondents preserve the argument that the recited 
``attachment structure'' in claim 20 of the '919 patent excludes 
external fasteners?
    (5) Is Complainants' argument that ``mount and secure'' as used in 
the '919 patent requires only that the fabric member be ``held 
securely'' along the inside of the support tubes a new claim 
construction that is waived?
    (6) Is there any evidence in the record that a skilled searcher 
conducting a diligent search reasonably could have been expected to 
discover Mariol, Tabarin, or Noblet?
    (7) Should the Manufacturing Respondents, against whom claim 20 of 
the '919 patent was not asserted, be allowed to assert a defense of 
invalidity as to claim 20?
    (8) For purposes of determining estoppel in a second proceeding, 
does privity require that there be a relationship between Baby Trend 
and the Manufacturing Respondents at the time of the first proceeding 
or the second? Is the answer different for purposes of IPR estoppel? 
Did Complainants establish that privity exists between Baby Trend and 
the Manufacturing Respondents for the purposes of IPR estoppel?
    (9) Did the ALJ address privity with regard to the second 
Manufacturer Respondent, Anhui Chile?
    (10) Do the customer-manufacturer contracts between Baby Trend and 
each Manufacturing Respondent create privity for purposes of IPR 
estoppel?
    (11) Does claim 20 of the '919 patent require the Clamped/Slit 
connection? Does the specification clearly and unequivocally disclose 
any embodiments that do not use the Clamped/Slit connection?
    (12) The Final ID considered the investments for the '855 and '694 
patents together. See, e.g., ID at 118. If the Commission determines 
that one or more claims of the '855 patent and/or '694 patent asserted 
for purposes of domestic industry in this case have been shown to be 
invalid, please identify,

[[Page 44398]]

with citations to the record, the appropriate domestic industry 
investments attributable to each patent.
    (13) Can investments made by an entity that is a contractor/
subcontractor, but is not a licensee of the complainant, be considered 
part of the domestic industry under the facts in this investigation? 
For purposes of determining significant or substantial investments or 
employment with respect to articles that practice the patents asserted 
in this investigation under section 337(a)(3), should the Commission 
consider the actual investments made by the entity or the payments made 
to that party by the Complainant for contracted manufacturing activity?
    (14) Please discuss whether, in an investigation in which the DI 
products are manufactured outside the United States, it is consistent 
with the statute, legislative history, and court and Commission 
precedent not to consider foreign manufacturing expenses in determining 
the significance of domestic industry investments and expenditures.
    The parties are invited to brief only the discrete issues requested 
above. The parties are not to brief other issues on review, which are 
adequately presented in the parties' existing filings.
    In connection with the final disposition of this investigation, the 
statute authorizes issuance of, inter alia, (1) an exclusion order that 
could result in the exclusion of the subject articles from entry into 
the United States; and/or (2) cease and desist orders that could result 
in the respondents being required to cease and desist from engaging in 
unfair acts in the importation and sale of such articles. Accordingly, 
the Commission is interested in receiving written submissions that 
address the form of remedy, if any, that should be ordered. If a party 
seeks exclusion of an article from entry into the United States for 
purposes other than entry for consumption, the party should so indicate 
and provide information establishing that activities involving other 
types of entry either are adversely affecting it or likely to do so. 
For background, see Certain Devices for Connecting Computers via 
Telephone Lines, Inv. No. 337-TA-360, USITC Pub. No. 2843, Comm'n Op. 
at 7-10 (Dec. 1994).
    The statute requires the Commission to consider the effects of that 
remedy upon the public interest. The public interest factors the 
Commission will consider include the effect that an exclusion order and 
cease and desist orders would have on: (1) the public health and 
welfare, (2) competitive conditions in the U.S. economy, (3) U.S. 
production of articles that are like or directly competitive with those 
that are subject to investigation, and (4) U.S. consumers. The 
Commission is therefore interested in receiving written submissions 
that address the aforementioned public interest factors in the context 
of this investigation.
    If the Commission orders some form of remedy, the U.S. Trade 
Representative, as delegated by the President, has 60 days to approve, 
disapprove, or take no action on the Commission's determination. See 
Presidential Memorandum of July 21, 2005, 70 FR 43251 (July 26, 2005). 
During this period, the subject articles would be entitled to enter the 
United States under bond, in an amount determined by the Commission and 
prescribed by the Secretary of the Treasury. The Commission is 
therefore interested in receiving submissions concerning the amount of 
the bond that should be imposed if a remedy is ordered.
    Written Submissions: The parties to the investigation are requested 
to file written submissions on the issues identified in this notice. 
Parties to the investigation, interested government agencies, and any 
other interested parties are encouraged to file written submissions on 
the issues of remedy, the public interest, and bonding. Such 
submissions should address the recommended determination by the ALJ on 
remedy and bonding. The parties should specifically address, among 
other things, whether the Commission should issue a cease and desist 
order as to all respondents or just to Baby Trend.
    In its initial submission, Complainants are also requested to 
identify the remedy sought and to submit proposed remedial orders for 
the Commission's consideration. Complainants are further requested to 
provide the HTSUS subheadings under which the accused products are 
imported, and to supply the identification information for all known 
importers of the products at issue in this investigation. The initial 
written submissions and proposed remedial orders must be filed no later 
than close of business on July 20, 2023. Reply submissions must be 
filed no later than the close of business on July 27, 2023. No further 
submissions on these issues will be permitted unless otherwise ordered 
by the Commission. Opening submissions are limited to 75 pages. Reply 
submissions are limited to 35 pages. No further submissions on any of 
these issues will be permitted unless otherwise ordered by the 
Commission.
    Persons filing written submissions must file the original document 
electronically on or before the deadlines stated above. The 
Commission's paper filing requirements in 19 CFR 210.4(f) are currently 
waived. 85 FR 15798 (March 19, 2020). Submissions should refer to the 
investigation number (Inv. No. 337-TA-1288) in a prominent place on the 
cover page and/or the first page. (See Handbook for Electronic Filing 
Procedures, https://www.usitc.gov/documents/handbook_on_filing_procedures.pdf). Persons with questions regarding 
filing should contact the Secretary, (202) 205-2000.
    Any person desiring to submit a document to the Commission in 
confidence must request confidential treatment by marking each document 
with a header indicating that the document contains confidential 
information. This marking will be deemed to satisfy the request 
procedure set forth in Rules 201.6(b) and 210.5(e)(2) (19 CFR 201.6(b) 
& 210.5(e)(2)). Documents for which confidential treatment by the 
Commission is properly sought will be treated accordingly. Any non-
party wishing to submit comments containing confidential information 
must serve those comments on the parties to the investigation pursuant 
to the applicable Administrative Protective Order. A redacted non-
confidential version of the document must also be filed with the 
Commission and served on any parties to the investigation within two 
business days of any confidential filing. All information, including 
confidential business information and documents for which confidential 
treatment is properly sought, submitted to the Commission for purposes 
of this investigation may be disclosed to and used: (i) by the 
Commission, its employees and Offices, and contract personnel (a) for 
developing or maintaining the records of this or a related proceeding, 
or (b) in internal investigations, audits, reviews, and evaluations 
relating to the programs, personnel, and operations of the Commission 
including under 5 U.S.C. Appendix 3; or (ii) by U.S. government 
employees and contract personnel, solely for cybersecurity purposes. 
All contract personnel will sign appropriate nondisclosure agreements. 
All nonconfidential written submissions will be available for public 
inspection on EDIS.
    The Commission has also determined to extend the target date for 
completion of this investigation to August 28, 2023.
    The Commission vote for this determination took place on July 6, 
2023.

[[Page 44399]]

    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: July 6, 2023.
Lisa Barton,
Secretary to the Commission.
[FR Doc. 2023-14778 Filed 7-11-23; 8:45 am]
BILLING CODE 7020-02-P