Ronran,

Showmethemoney asked me to post this answer to you.

The Judge still has to rule on these motions. The motion dates are set.


UNITED STATES INTERNATIONAL TRADE COMMISSION
Washington, D.C.
Before the Honorable E. James Gildea
Administrative Law Judge
In the Matter of
CERTAIN WIRELESS CONSUMER
ELECTRONIC DEVICES AND
COMPONENTS THEREOF
Investigation No. 337-TA-853
COMMISSION INVESTIGATIVE STAFF’S RESPONSE TO RESPONDENTS
SIERRA WIRELESS, INC. AND SIERRA WIRELESS AMERICA, INC.’S
MOTION TO TERMINATE FOR COMPLAINANTS’ VIOLATION OF THEIR DUTY
OF CANDOR TO THE COMMISSION
The Commission Investigative Staff (“Staff”) responds to the motion (Mot. Docket No.
853-007) of Respondents Sierra Wireless, Inc. and Sierra Wireless America, Inc. (collectively,
“Sierra Wireless”) seeking termination of this investigation as a sanction for Complainants’
alleged breach of its duty of candor. For the reasons set forth herein, the Staff believes that
Sierra Wireless’ motion should be denied.
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1
The Staff notes that the motion fails to include certification as required by Ground Rule 3.2.
Specifically, the motion does not state that Sierra Wireless made “reasonable, good-faith efforts
to contact and resolve the matter with the other parties at least two business days prior to filing
the motion…” Order No. 2, Ground Rule 3.2 (August 24, 2012) (emphasis in original). The
Staff submits that the motion may be denied on this basis alone. See, e.g., Certain LightEmitting Diodes and Products Containing Same, Inv. No. 337-TA-798, Order No. 13 (November
2, 2011); Certain Microprocessors, Components Thereof, and Products Containing Same, Inv.
No. 337-TA-781, Order No. 10 (September 8, 2011). See also Certain Portable Electronic
Devices and Related Software, Inv. No. 337-TA-797, Order No. 17 (November 30, 2011);
Certain Dynamic Random Access Memory and NAND Flash Memory Devices and Products
Containing Same, Inv. No. 337-TA-803, Order No. 15 (November 21, 2011); Certain Electronic
Devices, Including Wireless Communication Devices, Portable Music and Processing Devices,
and Tablet Computers, Inv. No. 337-TA-794, Order No. 18 (November 18, 2011). - 2 -
I. BACKGROUND
On July 24, 2012, Technology Properties Limited LLC (“TPL”), Phoenix Digital
Solutions LLC (“PDS”), and Patriot Scientific Corporation (“PTSC”) (collectively,
“Complainants”) filed a complaint alleging violations of Section 337 by over twenty respondents
based on infringement of U.S. Patent No. 5,809.336 (“the '336 patent”). See Complaint at ¶¶ 1,
11-23. The Complaint included a summary of numerous enforcement actions filed by
Complainants related to the '336 patent. See id. at ¶¶ 134-154. However, the Complaint
apparently failed to summarize all proceedings related to '336 patent, including an action filed by
named inventor, Charles H. Moore, against Complainants in the Superior Court of California,
County of Santa Clara. See Mot., Exh. B.
Mr. Moore’s complaint acknowledges and supports the facts alleged by Complainants in
this investigation. Namely, Moore alleges that he entered into an agreement with TPL whereby
he “assigned to Defendant TPL a minority share (45%) of Plaintiff Moore’s right, title and
interest to the MMP technology” and “granted to TPL a license for the purpose of permitting
TPL to commercialize the MMP technology.” Id at ¶ 31. Although Moore acknowledges
receiving over $11 million from TPL’s commercialization efforts (Id. at ¶ 32), he now seeks
remedies including damages for unpaid license fees and royalties (Id. at ¶ 61), cancellation of the
commercialization agreement between Moore and TPL (Id. at ¶ 59), and punitive and exemplary
damages (Id. at ¶ 62). In sum, Moore does not contest that he signed an agreement granting TPL
sufficient rights to bring this action. However, he does now seek rescission of that agreement.
This investigation was instituted by publication of a notice in the Federal Register on
August 24, 2012. 77 Fed. Reg. 51572 (August 24, 2012). Sierra Wireless filed its motion on
September 28, 2012 and Complainants filed a motion (Mot. Docket No. 853-008) seeking to
amend its complaint to correct its allegedly inadvertent oversight on October 2, 2012. - 3 -
II. DISCUSSION
On June 30, 1988, the Commission considered whether a Complainant should be
sanctioned for errors, omissions and/or misstatements in its complaint. Certain Indomethacin,
Inv. No. 337-TA-183, Comm’n Op. at 1-3. In that investigation, the Commission held that an
implicit duty of candor existed, but noted that it had never been articulated. Id. at 2-3.
Ultimately, the Commission declined to define the duty of candor in that investigation, but stated
that “the Commission will initiate a rulemaking proceeding which will provide the public, the
Commission’s Office of Unfair Import Investigations, and its ALJs the opportunity to comment
on the standard of conduct appropriate on filing a section 337 complaint.” Id. at 3. As a result,
the Commission promulgated new rules on August 1, 1994, explicitly defining a duty of candor
(Commission Rule 210.4(c)) and setting forth procedures and conditions for imposing sanctions
(Commission Rules 210.4(d) and 210.25). See 54 Fed. Reg. 39039 (August 1, 1994).
Commission Rule 210.25 defines four grounds upon which a party may file a motion for
sanctions: “abuse of process under § 210.4(d)(1), abuse of discovery under § 210.27(d)(3),
failure to make or cooperate in discovery under § 210.33 (b) or (c), or violation of a protective
order under § 210.34(c).” 19 C.F.R. § 210.25(a)(1). Sierra Wireless’ motion is not based on any
of these permissible grounds, and thus should be denied.
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Moreover, even if Sierra Wireless had sought sanctions for a breach of the duty of candor
defined by Commission Rule 210.4(c), the motion would still be procedurally defective for

2
Sierra Wireless does not base its motion on abuse of process under § 210.4(d)(1), but instead
bases its motion on violation of a pre-institution duty of candor that is separate and distinct from
the duty of candor set forth by Commission Rule 210.4(c). Memo. at 7, n.3. However, this preinstitution duty of candor, itself based on an outdated duty owed by applicants to the U.S. Patent
and Trademark Office, was supplanted by the promulgation of Commission Rule 210.4 on
August 1, 1994. See 54 Fed. Reg. 39039 (August 1, 1994). Since that date, the Commission has
applied the duty of candor set forth in Commission Rule 210.4(c). See, e.g., Certain Wiper
Blades, Inv. No. 337-TA-816, Order No. 33 (July 11, 2012). - 4 -
failing to comply with the “safe harbor” provision of Commission Rule 210.4(d)(1)(i). See
Certain Oscillating Sprinklers, Sprinkler Components, and Nozzles, Inv. No. 337-TA-448, Order
No. 25 (September 25, 2001) (denying a motion for sanctions as procedurally defective where
the moving party did not adhere to the “safe harbor” provision). Indeed, after Complainants’
omission was brought to its attention by Sierra Wireless, Complainant filed a timely motion
seeking leave to amend its complaint to correct its purported inadvertent oversight. See Mot.
Docket No. 853-008 (October 2, 2012). This motion to amend the complaint would presumably
have precluded Sierra Wireless from seeking sanctions, even if it had complied with the requisite
“safe harbor” provision of Commission Rule 210.4(d)(1)(i).
III. CONCLUSION
For the foregoing reasons, the Staff believes that Sierra Wireless’ motion should be
denied.
Respectfully Submitted,
/s/ R. Whitney Winston
Lynn I. Levine, Director
Anne Goalwin, Supervisory Attorney
R. Whitney Winston, Investigative Attorney
OFFICE OF UNFAIR IMPORT INVESTIGATIONS
U.S. International Trade Commission
500 E Street SW, Suite 401
Washington, D.C. 20436
(202) 205-2221
(202) 205-2158 (fax)
October 10, 2012- 1 -
Certain Wireless Consumer Electronics Devices I