## Facts

- A patent-based unfair importation investigation under § 337 of the Tariff Act (19 U.S.C. § 1337) was brought at the U.S. International Trade Commission concerning wearable electronic devices with ECG functionality and related components.
- The complainant, AliveCor, Inc., owned patents covering ECG-related technologies and had developed products and software using those technologies, including an Apple Watch-compatible accessory previously marketed as the KBS system.
- The respondent, Apple Inc., imported and sold Apple Watch products with ECG functionality accused of infringing AliveCor’s patents.
- The asserted patents and claims included U.S. Patent No. 10,638,941 (claims 12, 13, 19–23) and U.S. Patent No. 10,595,731 (claims 1, 3, 5, 8–10, 12, 15, 16).
- AliveCor had stopped manufacturing the KBS system in 2018 but continued U.S.-based research, development, and improvements tied to the asserted patented technologies.
- The ITC instituted the investigation on May 19, 2021; an ALJ conducted claim construction and a multi-day evidentiary hearing in 2022.
- The ALJ issued an initial determination finding a § 337 violation and that AliveCor satisfied the domestic-industry requirement.
- The Commission reviewed specified issues and issued a final determination on December 21, 2022, followed by a limited exclusion order dated January 20, 2023.

## Issues

1. Whether Apple’s importation and post-importation sale of ECG-capable watches infringed the asserted claims of the ’941 and ’731 patents, constituting an unfair act under 19 U.S.C. § 1337.
2. Whether AliveCor satisfied the domestic-industry requirement under § 337(a)(3) through U.S.-based activities tied to the asserted patents, despite having discontinued manufacture of a prior product line.
3. Whether the statutory public-interest factors in § 337(d)(1) barred issuance of exclusionary relief, given arguments that exclusion could harm public health and welfare or impede research.
4. What scope of exclusionary relief and bonding were appropriate during the Presidential review period.

## Decision

- The Commission found a violation of § 337 based on Apple’s importation and sales of products that infringed one or more asserted claims of the ’941 and ’731 patents.
- The Commission left in place the finding that AliveCor established a domestic industry relating to the articles protected by the asserted patents.
- The Commission issued a limited exclusion order barring entry for consumption of covered ECG-capable wearable devices and components manufactured abroad by or for Apple, or imported by or for Apple and related entities, for the remaining terms of the patents.
- The order included exceptions for importation under license and for articles/components imported for servicing, repairing, or replacing covered articles imported before the order’s effective date pursuant to existing service and warranty contracts.
- The Commission determined that the public-interest factors in § 337(d)(1) did not preclude issuance of the limited exclusion order.
- The Commission set a bond of $2 per unit of covered articles imported during the Presidential review period.

## Legal Principles

- A § 337 violation may be found where imported articles infringe valid, enforceable U.S. patent claims and the complainant satisfies § 337’s domestic-industry requirement.
- The domestic-industry requirement may be satisfied through qualifying U.S. investments and activities (including research and development) that relate to the articles protected by the asserted patent.
- Before issuing an exclusion order, the Commission must consider the public-interest factors enumerated in 19 U.S.C. § 1337(d)(1); if those factors do not outweigh enforcement interests, exclusionary relief may issue.
- A limited exclusion order may be tailored to covered products and components and may include carve-outs for licensed importation and for servicing/repair/replacement of pre-order units under existing service and warranty obligations.
- During the Presidential review period, the Commission may permit importation of covered articles subject to a set bond.

## Conclusion

The Commission determined that Apple violated § 337 by importing and selling ECG-capable wearable devices infringing AliveCor’s asserted patent claims, found AliveCor satisfied the domestic-industry requirement through U.S.-based patent-related activity, and issued a limited exclusion order with limited service-related exceptions and a $2-per-unit bond during Presidential review.


In re Certain Wearable Elec. Devices with ECG Functionality & Components Thereof, Inv. No. 337-TA-1266 (U.S.I.T.C. Jan. 20, 2023)