[Federal Register Volume 88, Number 169 (Friday, September 1, 2023)]
[Notices]
[Pages 60491-60494]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-18893]


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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1328]


Certain Pillows and Seat Cushions, Components Thereof, and 
Packaging Thereof

Notice of a Commission Determination To Review in Part an Initial 
Determination Granting Complainant's Motion for Summary Determination 
of Violation of Section 337 and on Review, To Vacate Part of the 
Initial Determination; Request for Written Submissions on Remedy, the 
Public Interest, and Bonding

AGENCY: 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 an Initial 
Determination (``ID'') (Order No. 31) of the presiding administrative 
law judge (``ALJ''), granting a motion for summary determination of 
violation of section 337 and on review, to vacate part of the ID and to 
take no position on certain findings in the ID. The Commission requests 
written submissions from the parties, interested government agencies, 
and other interested persons on the

[[Page 60492]]

issues of remedy, the public interest, and bonding, under the schedule 
set forth below.

FOR FURTHER INFORMATION CONTACT: Edward S. Jou, Esq., Office of the 
General Counsel, U.S. International Trade Commission, 500 E Street SW, 
Washington, DC 20436, telephone (202) 205-3316. 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 
on September 13, 2022, based on a complaint (the ``Complaint'') filed 
by Purple Innovation, LLC of Lehi, Utah (the ``Complainant''). 87 FR 
56086-88 (Sept. 13, 2022). The Complaint alleges violations of section 
337 of the Tariff Act of 1930, as amended, 19 U.S.C. 1337, based upon 
the importation, the sale for importation, or sale within the United 
States after importation of certain pillows and seat cushions, 
components thereof, and packaging thereof by reason of infringement of 
the sole claim of U.S. Design Patent No. D909,092 (``the D'092 
patent''); claims 1-16, 18, 19, 21-33, and 35 of U.S. Patent No. 
10,772,445 (``the '445 patent''); claims 1-4, 6, 10-12, 19, and 20 of 
U.S. Patent No. 10,863,837 (``the '837 patent''); U.S. Trademark 
Registration No. 5,661,556 (``the '556 mark''); and U.S. Trademark 
Registration No. 6,551,053 (``the '053 mark''). Id. at 56086-87. The 
Complaint further alleges the existence of a domestic industry. Id. The 
Complaint also alleges violations of section 337 in the importation 
into the United States, or sale of certain products identified above by 
reason of trade dress infringement, the threat or effect of which is to 
destroy or substantially injure an industry in the United States. Id.
    The Commission's notice of investigation names 41 respondents: 
Bedmate-U Co., Ltd. (``Bedmate-U'') of Gyeonggi-do, Korea; Chuang Fan 
Handicraft Co., Ltd. of Zhejiang, China; Dongguan Bounce Technology 
Co., Ltd. of Guangdong, China; Dongguan Jingrui Silicone Technology 
Co., Ltd. (``Dongguan Jingrui'') of Guangdong, China; Foshan Dirani 
Design Furniture Co., Ltd. (``Dirani Design'') of Guangdong, China; 
Global Ocean Trading Co., Ltd. of Guangdong, China; Guang An Shi Lin 
Chen Zai Sheng Wuzi Co., Ltd. of Zhejiang, China; Guang Zhou Wen Jie 
Shang Mao Youxian Gongsi Co., Ltd. of Shanghai, China; Guangzhou 
Epsilon Import and Export Co., Ltd. of Guangdong, China; Guangzhoushi 
Baixiangguo Keji Youxian Gongsi Co., Ltd. of Guangdong, China; 
Haircrafters LLC of Chattanooga, TN; Hangzhou Lishang Import & Export 
Co., Ltd. of Zhejiang, China; Hangzhou Lydia Sports Goods Co., Ltd. 
(``Hangzhou Lydia'') of Zhejiang, China; Hebei Zeyong Technology Co., 
Ltd. of Hebei, China; Henson Holdings, LLC (``Henson Holdings'') of 
Lafayette, Louisiana; Hetaibao of Anhui, China; Hubei Sheng Bingyi 
Dianzi Keji Youxian Gongsi Co., Ltd. of Hubei, China; Kaifeng Shi Long 
Ting Qu Chen Yi of Henan, China; Lankao Junchang Electronic Commerce 
Co., Ltd. of Henan, China; Lei Lei Wang of Anhui, China; Liu Lin Xian 
Xu Bin Dian Zi Chan Pin Dian of Shanxi, China; Nanchang Shirong Bao Er 
Guanggao Youxian Gongsi Co., Ltd. of Jiangxi, China; Ningbo Bolian 
Import & Export Co., Ltd. (``Ningbo Bolian'') of Beijing China; Ningbo 
Minzhou Import & Export Co., Ltd. (``Ningbo Minzhou'') of Beijing, 
China; Ruian Xiu Yuan Guoji MaoYi Youxian Gongso Co., Ltd. of Zhejiang, 
China; Shandong Jiu Hui Xinxi Keji Youxian Gongsi Co., Ltd. 
(``Shangdong Jiu Hui'') of Shandong, China; Shanxi Chao Ma Xun Keji 
Youxian Gongsi Co., Ltd. of Shanxi, China; Shenzhen Baibaikang 
Technology Co., Ltd. of Guangdong, China; Shenzhen Leadfar Industry 
Co., Ltd. (``Shenzhen Leadfar'') of Guangdong, China; Shenzhen Shi Mai 
Rui Ke Dianzi Shangwu Co., Ltd. of Guangdong, China; Shenzhen Shi Xin 
Shangpin Dianzi Shangwu Youxian Gongsi Co., Ltd. (``Shenzhen Shi Xin'') 
of Guangdong, China; Shenzhen Shi Yan Huang Chu Hai Keji Youxian Gongsi 
Co., Ltd. of Guangdong, China; Shenzhen Shi Yuxiang Meirong Yongju of 
Guangdong, China; Shenzhen Tianrun Material Co., Ltd. of Guangdong, 
China; Wuhan Chenkuxuan Technology Co., Ltd. of Hubei, China; Xiao 
Dawei of Fujian, China; Xiao Xiao Pi Fa Shang Mao You Xian Ze Ren 
Gongsi Co. of Shanxi, China; YaRu Wang of Shanxi, China; Yiwu Youru E-
commerce Co., Ltd. of Zhejiang, China; Zhejiang Xinhui Import & Export 
Co., Ltd. of Zhejiang, China; and Zhou Meng Bo of Guangdong, China. Id. 
at 56087-88. The Office of Unfair Import Investigations (``OUII'') is 
also a party to this investigation. Id. at 56088.
    Five respondents were terminated by withdrawal of allegations in 
the Complaint pursuant to Order No. 15 (Jan. 10, 2023), unreviewed by 
Comm'n Notice (Feb. 8, 2023). Twenty-five additional respondents were 
terminated by withdrawal of allegations in the Complaint pursuant to 
Order No. 19 (Feb. 16, 2023), unreviewed by Comm'n Notice (Mar. 20, 
2023), reconsidered in part by Comm'n Notice (May 19, 2023). 
Complainant also withdrew its allegations with respect to trade dress, 
the '556 mark, and the D'092 patent pursuant to Order No. 19. Id. Seven 
additional respondents were terminated by consent order pursuant to 
Order No. 23 (Mar. 30, 2023) (Shenzhen Shi Xin), Order No. 24 (Apr. 3, 
2023) (Bedmate-U), Order No. 25 (Apr. 7, 2023) (Henson Holdings), Order 
No. 26 (Apr. 10, 2023) (Ningbo Minzhou), Order No. 27 (Apr. 12, 2023) 
(Lei Lei Wang), Order No. 28 (Apr. 13, 2023) (Hetaibao), and Order No. 
29 (May 10, 2023) (Ningbo Bolian), unreviewed by Comm'n Notice (May 19, 
2023).
    Dirani Design, Dongguan Jingrui, Hangzhou Lydia, and Shenzhen 
Leadfar (collectively, the ``Defaulting Respondents'') were found in 
default pursuant to Order No. 16 (Jan. 11, 2023), unreviewed by Comm'n 
Notice (Feb. 8, 2023), and Order No. 21 (Mar. 8, 2023), unreviewed by 
Comm'n Notice (Mar. 30, 2023).
    On March 15, 2023, Complainant filed a motion for summary 
determination of violation with respect to infringement of certain 
claims of the '837 patent and the '445 patent by the Defaulting 
Respondents. On March 29, 2023, OUII filed a response in support of the 
motion.
    On July 13, 2023, the ALJ granted Complainant's motion in an 
Initial Determination and issued a Recommended Determination on Remedy 
and Bond (Order No. 31, the ``ID'' and ``RD''). The ID finds a 
violation of section 337 by reason of infringement of certain claims of 
the '445 patent by Dongguan Jingrui, Hangzhou Lydia, and Shenzhen 
Leadfar. The ALJ notes that ``a finding of violation as to Dirani 
Design is unnecessary because Purple seeks only a limited exclusion 
order.'' RD at 50. The RD recommends that a limited exclusion order 
issue with respect to the products of Dirani Design accused of 
infringing certain claims of the '837 patent and that a general 
exclusion order issue with respect to articles that infringe certain 
claims of the '445 patent. The RD further recommends that cease and 
desist orders issue with

[[Page 60493]]

respect to each of the Defaulting Respondents and that a 100% bond be 
set during Presidential review.
    No petitions for review of the ID were filed.
    The Commission has determined to review the ID in part to address 
(i) the ID's consideration of the alleged indefiniteness of the term 
``threshold pressure level'' and (ii) the ID's findings with respect to 
the significance of domestic industry investments.
    On review, the Commission has determined to vacate the ID's 
consideration of the alleged indefiniteness of the term ``threshold 
pressure level.'' ID at 28-33. Consistent with Lannom Mfg. Co. v. U.S. 
Int'l Trade Comm'n, 799 F.2d 1579 (Fed. Cir. 1986), the Commission 
declines to address invalidity arguments raised solely by a party that 
has been terminated from the investigation before invalidity is 
decided. See id. at 1579-80 (``Congress did not authorize the 
Commission to redetermine patent validity when no defense of invalidity 
has been raised.''); see also Certain Toner Cartridges and Components 
Thereof, Inv. No. 337-TA-918, Initial Determination at 68-69 (May 12, 
2015) (declining to address indefiniteness arguments raised by 
terminated respondents), unreviewed in relevant part by Comm'n Notice 
(Jun. 24, 2015). The Commission affirms the ID's finding that no 
construction of the term ``threshold pressure level'' is necessary as 
the surrounding claim language already defines the term as the pressure 
at which the claimed ``deformable wall members'' are ``configured to 
buckle.'' ID at 33-34.
    With respect to the economic prong of the domestic industry 
requirement, the Commission takes no position with respect to the ID's 
finding that the investments are ``quantitatively significant in 
absolute terms.'' ID at 45.1 2 The Commission affirms the 
ID's finding that Complainant's domestic investments in plant and 
equipment and employment of labor and capital are significant. Id. at 
45-47.
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    \1\ Commissioner Kearns and Commissioner Stayin also take no 
position on the ID's comparisons of Complainant's allocated domestic 
expenditures on manufacturing and R&D relating to the domestic 
industry product to department-wide expenditures related to the 
domestic industry products. See ID at 46.
    \2\ Commissioner Karpel would adopt the ID's analysis of the 
economic prong of the domestic industry requirement. ID at 38-47. 
The ID identifies in numerical terms the particular investments that 
are claimed by Purple with respect to the articles protected by the 
`445 patent and notes that Purple's investments within these 
statutory categories ``are quantitatively significant in absolute 
terms.'' ID at 45-46. The ID then reviews the significance of these 
investments in context, comparing them to total manufacturing and 
R&D expenditures for the DI product, Purple's overall U.S. 
expenditures on its DI products, and its revenues from sales of 
these products and finds these indicia show the investments to be 
quantitatively significant. Id. at 46-47. The ID's approach is 
consistent with the Commission's practice to review the asserted 
investments in numerical terms and then review those investments in 
the context of the company's operations, the marketplace, or the 
industry in question. Therefore, Commissioner Karpel would affirm 
the ID's domestic industry economic prong analysis in its entirety.
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    The Commission has determined not to review the remainder of the 
ID, including the determination that there is a violation of section 
337 by reason of infringement of certain claims of the '445 patent by 
Dongguan Jingrui, Hangzhou Lydia, and Shenzhen Leadfar.
    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 respondent 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: 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.
    In its initial submission, Complainant is also requested to 
identify the remedy sought and Complainant and OUII are requested to 
submit proposed remedial orders for the Commission's consideration. 
Complainant is 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 September 11, 2023. Reply submissions must be filed no later than 
the close of business on September 18, 2023. No further submissions on 
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 (Mar. 19, 2020). Submissions should refer to the 
investigation number (``Inv. No. 337-TA-1328'') 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

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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 simultaneously 
with any confidential filing and must be served in accordance with 
Commission Rule 210.4(f)(7)(ii)(A) (19 CFR 210.4(f)(7)(ii)(A)). 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 vote for this determination took place on August 28, 
2023.
    This action is taken under the authority of 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: August 28, 2023.
Lisa Barton,
Secretary to the Commission.
[FR Doc. 2023-18893 Filed 8-31-23; 8:45 am]
BILLING CODE 7020-02-P