Security threats fail, Huawei / ZTE America's "337 investigation" wins initial ruling

"In 2012, there were 60 cases of 337 investigations in the United States, of which 18 cases involved Chinese products. Electronic information products are the most important products encountered in investigations."

Yesterday, the Ministry of Commerce ’s Import and Export Fair Trade Bureau website showed that the US International Trade Commission (ITC) made a preliminary ruling on the wireless consumer electronic device and component 337 investigation on September 6, ruling that the defendant ZTE and Huawei were not infringing.

This is another victory for the two companies following the first preliminary award in the wireless 3G device 337 investigation in June this year. Relevant persons of ZTE said that they have not received official notice.

On July 24 last year, American Technology Asset Co., Ltd., Phoenix Digital SoluTIons LLC, and Patriot ScienTIfic applied to ITC, alleging that some of the wireless consumer electronic devices and their components imported and sold in the US domestic market infringed their patent rights US Patent No. 5809336); August 24, 2012, the US ITC officially filed a case investigation, in which China Huawei Technologies Co., Ltd. and ZTE Corporation were involved as mandatory responding parties.

ZTE and Huawei U.S. "337 Investigations" win early ruling

After more than a year of difficult lawsuits, Huawei and its subsidiaries, as well as ZTE and the United States, were ruled in the preliminary ruling of the 337 investigation (337-TA-853) involving some wireless consumer electronics devices issued by the US ITC on September 6 The wireless electronic equipment imported by the company from the domestic market sold by the company in the United States did not infringe the claims 1, 6, 7, 9, 9 to 11 and 13 to 16 of the US Patent No. 5809336, nor violated the provisions of the US Section 337. Ruling that there is a case of using patent No. 5809336 in the domestic industry in the United States.

In recent years, "section 337", as a weapon used by American companies to deal with infringement of intellectual property rights or unfair competition by foreign competitors, has been frequently used in trade frictions against Chinese companies. As a trade barrier set up through the "threshold" of patents and intellectual property rights, once the enterprise involved is ruled to violate Section 337, the products involved will lose their eligibility to sell in the US market. In 2012, 60 US 337 investigations were filed, of which 18 cases involved Chinese products. Electronic information products were the most important products encountered in the investigation. Huawei and ZTE alone have encountered 5 consecutive US 337 cases since August 2011. survey.

In January of this year, the US wireless manufacturer Inter Digital accused Huawei, ZTE and other companies of infringing one of its latest technology patents on mobile phones. The US International Trade Commission immediately launched a 337 investigation of the company involved. This round of investigation made a preliminary ruling on June 28 this year, ruling that one of the seven patents filed by the applicant Inter Digital was invalid and the other six were not infringed by the defendant companies ZTE and Huawei. This is the first time the two companies have won in such cases.

However, even if such a survey in the US market takes place, the impact on Huawei and ZTE is very limited. Prior to this, the Intellectual Property Committee of the US House of Representatives had issued a security threat report, including Huawei and ZTE in the scope of non-recommended procurement.

Currently, Huawei has very few sales in the US market. As far as Huawei is concerned, it no longer regards the US market as a strategic market. ZTE's main sales in the US market come from terminals, and equipment sales are also limited. However, this is a landmark victory for Chinese enterprises in foreign trade frictions. The Ministry of Commerce stated in the website announcement: "Objectively reflects the competitive strength of our enterprise and strongly encourages the confidence of enterprises in responding to complaints."

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