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The Federal Circuit reversed the Commission’s decision holding that the complainant Standard had satisfied the domestic industry requirement of Section 337.  Standard’s products were manufactured overseas.  There were, however, four components that Standard purchased, off-the-shelf from suppliers in the U.S.  The Commission held that Standard had satisfied the domestic industry requirement based on the qualitative assessment that these four components were “critical” to the devices at issue.  The Federal Circuit reversed, holding that Section 337 requires a quantitative, not a qualitative, analysis for determining whether the domestic industry requirement has been met.  Here, the components purchased in the U.S. were not “subcontracted components,” but rather were purchased “off-the-shelf.”  Thus, there is no evidence of any investment of capital or labor in the U.S. by the petitioner.  Here, the qualitative factors cannot compensate for quantitative data that indicate insignificant investment and employment and therefore Standard’s evidence cannot meet prongs (A) and (B) of the Section 337 domestic industry requirement.  

Lelo Inc. v. International Trade Comm., Case No. 2013-1582 (May 11, 2015); Opinion by: Reyna, joined by Moore and Clevenger; Appealed From: U.S. International Trade Commission.  Read the full opinion here.

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