Category: Antitrust & Trade Regulation

How Should a Licensing Commitment Affect the Availability of Injunctions at the ITC?

We may be about to find out, as the Commission seeks comments on exclusion orders for infringement of standard essential patents.

Governed by 19 U.S.C. § 337, the U.S. International Trade Commission (“ITC”) is empowered to investigate unfair acts in the importation of articles into the United States. The ITC can be a powerful forum for owners of U.S. patents as it may issue exclusion orders barring infringing articles from entering the United States. Although the ITC is an independent federal agency, it is natural to wonder whether the Trump administration’s policies – including, in particular its “America First Trade Policy” issued on January 20 – could affect litigation before the Commission.
While the day-to-day handling of investigations before the ITC is unlikely to be affected by the specific trade policies of a particular administration, § 337 provides for a presidential review period, during which the president can review and potentially veto an exclusion order entered by the Commission in an investigation. This power has rarely been exercised, but the history of presidential review in investigations involving standard essential patents (“SEPs”) provides an example where the policies of an administration can directly impact ITC practice.
It started in 2013 when the Obama administration overturned an ITC order that would have excluded various Apple iPhone and iPad products from the United States market. In that investigation, Samsung alleged that Apple infringed patents that had been declared essential to certain telecommunications standards, and, in overturning the import ban, the U.S. Trade Representative acting on behalf of the Obama administration cited a “Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments” jointly issued by the Department of Justice and the U.S. Patent and Trademark Office on January 8, 2013. https://www.justice.gov/d9/pages/attachments/2018/12/10/290994.pdf
The Obama-era Policy Statement cautioned that granting exclusion orders for infringement of standard essential patents – which are typically accompanied by commitments to license on terms that are fair, reasonable and non-discriminatory (“FRAND” or “F/RAND”) – may result in the patent owner engaging in “patent hold up” by demanding a higher royalty for the use of its patent than would have been possible before the standard was set, and that such behavior may harm consumers. Accordingly, the 2013 Policy Statement concluded that “[a]lthough [] an exclusion order for infringement of F/RAND-encumbered patents essential to a standard may be appropriate in some circumstances, we believe that, depending on the facts of individual cases, the public interest may preclude the issuance of an exclusion order in cases where the infringer is acting within the scope of the patent holder’s F/RAND commitment and is able, and has not refused, to license on F/RAND terms.”
During President Trump’s first term, the administration issued its own “Policy Statement on Remedies for Standard-Essential Patents Subject to Voluntary F/RAND Commitments” on December 19, 2019. https://www.justice.gov/atr/page/file/1228016/dl This 2019 Policy Statement identified “concerns that the 2013 policy statement has been misinterpreted to suggest that a unique set of legal rules should be applied in disputes concerning patents subject to a F/RAND commitment,” such that “injunctions and other exclusionary remedies should not be available in actions for infringement of standards-essential patents.” The 2019 Policy Statement warned that “such an approach would be detrimental to the carefully balanced patent system.” Accordingly, the USPTO and DOJ withdrew the 2013 Policy Statement in favor of a policy where “the existence of F/RAND or similar commitments [] may be relevant and may inform the determination of appropriate remedies,” but “the general framework for deciding these issues remain[ed] the same as in other patent cases.”
This back-and-forth continued with the Biden administration, but to a lesser extent. After soliciting written submissions and hearing a variety of views on both sides of the issues, on June 8, 2022, the Biden administration issued a “Withdrawal of 2019 Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments,” which stated in a footnote that it was also not reinstating the Obama-era 2013 Policy Statement. https://www.uspto.gov/sites/default/files/documents/SEP2019-Withdrawal.pdf. Accordingly, the 2022 Withdrawal concluded that conduct by SEP holders and standards implementers should be reviewed “on a case-by-case basis to determine if either party is engaging in practices that result in the anticompetitive use of market power or other abusive processes that harm competition.”
It remains to be seen whether the USPTO, DOJ and NIST will reinstate the 2019 Policy Statement in President Trump’s second term. The policy statement put into effect during President Trump’s first term was withdrawn by President Biden, but in a way that did not reinstate the earlier Obama-era policy, and the 2022 Withdrawal does not on its face articulate any view of available remedies for infringement of standard essential patents that is inconsistent with the 2019 Policy Statement. Nevertheless, one would reasonably expect that the second Trump administration would be inclined to favor a policy where available remedies for infringement of standard essential patents would not materially differ from the remedies available for infringement of other patents.
However, earlier this month the International Trade Commission issued a notification suggesting that the Commission’s thoughts on this issue may not be so predictable. On March 4, 2025, the ITC published a Notice in the Federal Register relating to Investigation No. 337-TA-1380, which involved an allegation by Nokia that Amazon infringes certain patents declared essential to video compression standards which carry with them a commitment to license on RAND terms. The Notice indicates that the Commission has determined to review the Initial Determination of the Administrative Law Judge in its entirety, and it solicits written submissions from the parties on various issues, including the following SEP-specific questions:

When the complainant alleges that an asserted patent is a standard essential patent, subject to reasonable, and nondiscriminatory (RAND) licensing terms, is the complainant precluded from seeking an exclusion order and/or cease and desist order based on infringement of that patent? Should the Commission consider RAND licensing obligations as a legal or equitable defense (i.e., as part of its violation determination) under section 337(c), 19 U.S.C. 1337(c)) or as part of its consideration of the public interest factors under section 337(d)(1) and (f)(1)? Please discuss theories in law, equity, and the public interest, and identify which (if any) of the public interest factors of 337(d)(1) and (f)(1) preclude issuance of such an order.
In the event a violation is found, does the information regarding the parties’ RAND obligations and licensing attempts inform any particular public interest factor that the Commission should consider under section 337(d)(1) and (f)(1)? If so, please identify which factor it informs and explain why, including the relevant evidence of record. As part of its public interest analysis, should the Commission determine whether any prior license offer made by the patent holder covering the accused products is reasonable and non-discriminatory? If so, what evidence should the Commission consider in determining whether offers are reasonable and non-discriminatory based on the record of this investigation?

In addition, the March 4 Notice solicited written submissions from not just the parties, but also any interested government agencies or other interested parties on the issues of remedy and the public interest, which would seemingly include addressing the above two questions and, in general, Amazon’s argument in the case that an exclusion order would be against the public interest because it would exclude articles that practice SEPs. Such submissions were due on March 13, though approved late submissions continue to be filed, and the target date for completion of the Investigation is currently May 14, 2025.
The questions are interesting, particularly in view of the Obama administration’s directive in 2013 that “in any future cases involving SEPs that are subject to voluntary FRAND commitments, the Commission should be certain to (1) to examine thoroughly and carefully on its own initiative the public interest issues presented both at the outset of its proceeding and when determining whether a particular remedy is in the public interest and (2) seek proactively to have the parties develop a comprehensive factual record related to these issues in the proceedings before the Administrative Law Judge and during the formal remedy phase of the investigation before the Commission, including information on the standards-essential nature of the patent at issue if contested by the patent holder and the presence or absence of patent hold-up or reverse hold-up.”
Following that directive, the Commission has considered the issue in the past, and although it typically followed the 2013 Obama administration’s directive to consider the issues, it virtually always found that SEPs should not receive any type of “special treatment” at the ITC. However, based upon the Commission’s recent Notice, it appears that the Commission may be thinking more critically about the issue of defenses and exclusionary remedies for infringement of SEPs, with the history of these various Policy Statements showing that there is not a singular policy view, both from administrations with different perspectives and from parties with divergent interests. And with the target date for completion of the Nokia/Amazon Investigation just two months away and with comments having just recently been submitted, we may soon learn how the ITC intends to treat the Obama-era directive in the context of current trade policy.

What Every Multinational Company Needs to Know About … Criminal Enforcement of Trade, Import, and Tariff Rules: A Growing Risk for Businesses

In less than 100 days, the Trump administration has implemented a dizzying array of new tariffs, significantly increasing costs and complexity for U.S. importers. The administration is keenly aware that companies operating in this high-tariff environment may attempt creative, or even fraudulent, strategies to minimize tariff payments. Consequently, enforcement agencies have been directed to closely monitor and vigorously prosecute efforts at improper tariff engineering and duty evasion.
Historically, U.S. Customs and Border Protection (CBP) has relied heavily on its administrative remedies to enforce the customs and tariff laws. The Department of Justice (DOJ), however, has been steadily escalating enforcement intensity, notably through the False Claims Act (FCA), leveraging its treble damages and civil penalties to pursue false statements about imports. For a more detailed explanation of how the FCA has been used in this area, please see our recent blog post, “What Every Multinational Company Should Know About … The Rising Risk of Customs False Claims Act Actions in the Trump Administration.”
DOJ also has demonstrated a growing willingness to pursue criminal charges against companies and individuals involved in customs fraud schemes such as the purposeful misclassification of goods, falsifying country-of-origin declarations, and intentionally shipping goods through low-tariff countries. Importers of goods into the U.S. should expect criminal enforcement to accelerate in the coming months and years.
Potential Criminal Charges for Violating Customs Rules
DOJ has several available charging options in pursuing criminal cases against companies and individuals who violate customs rules by making false statements about customs requirements such as classification, country of origin, valuation, assists, and free trade preferences. Commonly used federal criminal statutes that could apply to tariff underpayments include:

Smuggling (18 U.S.C. § 545), which criminalizes knowingly and willfully importing merchandise into the U.S., contrary to law (e.g., misclassification or mislabeling to evade duties), and is typically used when importers intentionally misrepresent goods’ classification or origin to avoid or lower tariffs, often proven through seized documents or intercepted communications. This provision already has been applied in United States v. Esquijerosa, where an importer was charged with routing Chinese-origin goods through third countries to avoid tariffs, resulting in a December 6, 2024, guilty plea under the general conspiracy statute.
False Claims (18 U.S.C. § 287), which criminalizes knowingly making false, fictitious, or fraudulent claims to federal authorities and is used where importers knowingly provide false documentation or declarations to CBP concerning country-of-origin, valuation, related parties, or classification while paying improperly low customs or anti-dumping duties.
False Statements (18 U.S.C. § 1001), which criminalizes knowingly making materially false, fictitious, or fraudulent statements or representations to federal authorities and is frequently applied where importers intentionally provide false documentation or declarations to CBP concerning country-of-origin, valuation, related parties, or classification.
Wire Fraud (18 U.S.C. §§ 1343 & 1349), which criminalizes schemes to defraud involving interstate or foreign wire communications (such as emails or wire transfers) and can be applied to customs violations due to the prevalent use of electronic communications and financial transfers in import transactions, providing prosecutors leverage in complex schemes.
International Emergency Economic Powers Act (IEEPA) (50 U.S.C. § 1701), which criminalizes the willful evasion or violation of regulations issued under national emergency declarations concerning international commerce and could apply where importers deliberately evade tariffs or restrictions enacted under presidential authority during declared emergencies, such as recent trade actions involving China.
Conspiracy (18 U.S.C. § 371), which criminalizes any agreement between two or more persons to commit any of the above crimes.

Examples of Past Customs-Related Criminal Cases Brought by DOJ
Criminal prosecutions based on violations of customs rules do not require DOJ to break new ground. Here are a few significant criminal trade cases:

Plywood Tariff Evasion Case (2024): A Florida couple was charged under the Lacey Act and received 57-month prison sentences for evading approximately $42.4 million in customs duties. They fraudulently declared Chinese plywood as originating from Malaysia or Sri Lanka, avoiding anti-dumping duties exceeding 200%.[1]
Stargate Apparel (2019): DOJ filed criminal and civil charges against the CEO of a children’s apparel company, Stargate Apparel, Inc. The CEO was charged with participating in a years-long scheme to defraud CBP by submitting invoices that falsely understated the true value of the goods imported by his company into the United States.[2]
Food Importation Fraud (2013): Several individuals and two food processing companies were criminally charged for illegally importing a Chinese-origin food product by intentionally mis-declaring its origin and classification as Vietnamese. Through complex transshipment methods, the defendants sought to evade over $180 million in anti-dumping duties.
Fentanyl Precursors (2025): Indian chemical firms Raxuter Chemicals and Athos Chemicals faced criminal charges for smuggling precursor chemicals used in fentanyl production into the U.S. and Mexico, employing extensive false declarations to evade detection.[3]

How Customs Violations or Underpayments Come to DOJ’s Attention
Customs violations can come to DOJ’s attention through several channels:

CBP Referrals: CBP’s Automated Commercial Environment (ACE) uses sophisticated algorithms capable of identifying anomalies, suspicious patterns, or misrepresentations in import data. Fraudulent conduct will result in a referral by CBP to DOJ — similar to Health and Human Services’ very successful data mining tools, which have led to numerous civil and criminal fraud cases.
Voluntary Disclosures: Although CBP encourages self-reporting, prior voluntary disclosures can expose intentional misconduct, triggering criminal investigations.
Whistleblower Reports: Claims filed by employees or competitors under the FCA or reports submitted via CBP’s e-Allegations Program or the Enforce and Protect Act (EAPA) portal often reveal duty evasion schemes, prompting DOJ intervention. Several plaintiff-side FCA law firms are touting their experience in customs and trade cases, and we anticipate referral activity in this space to increase.

Navigating Increased Enforcement and Mitigating Risk
Criminal enforcement of CBP regulations presents significant risk for companies that serve as importers of record, who are responsible under CBP regulations for ensuring the complete and accurate submission of import data. In this new trade environment, there will be an increasing emphasis by CBP to detect importers attempting to make end-runs around higher tariffs, particularly from China.
Risk mitigation involves a thorough review of the company’s ACE data to assess the company’s importing patterns, focusing particularly on imports targeted for increased tariffs by the Trump administration. Companies also should evaluate the current state of their customs compliance to confirm consistent and robust procedures for classification, origin determination, valuation, and recordkeeping, to ensure that reasonable care in being used in import operations, and should consider preparing “reasonable care” memoranda to memorialize their treatment of how they are handling tariff-related obligations. Finally, importers should establish post-entry checks and reviews to ensure that they can correct any entry-related information submitted to Customs before it becomes final at liquidation. This is especially important in the context of a high-tariff environment, where potential penalties for underpayment of tariffs are vastly greater. Foley’s international trade team has developed a six-step tariff risk management plan, accessible here: “Managing Import and Tariff Risks During a Trade War.”

[1] U.S. Department of Justice (DOJ), Florida Conspirators Sentenced to Nearly Five Years in Prison Each for Evading Over $42 million in Duties when Illegally Importing and Selling Plywood, (Feb. 15, 2024), https://www.justice.gov/usao-sdfl/pr/florida-conspirators-sentenced-nearly-five-years-prison-each-evading-over-42-million
[2] U.S. Department of Justice (DOJ), Manhattan U.S. Attorney Announces Criminal And Civil Charges Against CEO Of Clothing Company For Million-Dollar Customs Fraud (June 6, 2019), https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-announces-criminal-and-civil-charges-against-ceo-clothing-company.
[3] U.S. Department of Justice (DOJ), Two Indian Chemical Companies and a Senior Executive Indicted for Distributing Fentanyl Precursor Chemicals (Jan. 6, 2025), https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-announces-criminal-and-civil-charges-against-ceo-clothing-company; see also Associated Press, 2 Indian Companies Charged with Smuggling Chemicals Used in Making Fentanyl (Jan. 6, 2025), https://apnews.com/article/indian-chemical-companies-charged-fentanyl-opioid-smuggling-d2cfbc05f0742953e35a05cd0c889dc3

New York AG Settles with School App

The New York Attorney General recently entered into an assurance of discontinuance with Saturn Technologies, operator of an app used by high school and college students. The app was designed to be a social media platform that assists students with tracking their calendars and events. It also includes connection and social networking features and displayed students’ information to others. This included students’ location and club participation, among other things. According to the NYAG, the company had engaged in a series of acts that violated the state’s unfair and deceptive trade practice laws.
In particular, according to the attorney general, although the app said that it verified users before allowing them into these school communities, in fact anyone could join them. Based on the investigation done by the AG, the majority of users appeared not to have been verified or screened to block fraudulent accounts. In other words, accounts that were not those of students at the school. This was a concern, stressed the AG, as the unverified users had access to personal information of students. The AG argued that these actions constituted unfair and deceptive trade practices.
Finally, the AG alleged that the company did not make it clear that “student ambassadors” (who promoted the program) received rewards for marketing the program. As part of the settlement, the app maker has agreed to create and train employees and ambassadors on how to comply with the FTC’s Endorsements Guides by, among other things, disclosing their connection to the app maker when discussing their use of the app.
Putting It Into Practice: This case is a reminder to review apps directed to older minors not only from a COPPA perspective (which applies to those under 13). Here, the NYAG has alleged violations stemming from representations that the company made about the steps it would take to verify users. It also signals expectations in New York for protecting minors if offering a social media platform intended only for that market. 
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Regulations on the Implementation of the Anti-Foreign Sanctions Law of the People’s Republic of China – Foreign-Owned Intellectual Property Can Be Seized

On March 23, 2025, the State Council of the People’s Republic of China promulgated the Regulations on the Implementation of the Anti-Foreign Sanctions Law of the People’s Republic of China (实施〈中华人民共和国反外国制裁法〉的规定). Article 7 of the Regulations specifically allows for the seizure of intellectual property of those that “directly or indirectly participate in the drafting, decision-making, or implementation of the discriminatory restrictive measures in Article 3 of Anti-Foreign Sanctions Law.”  Paragraph 2, Article 3 of the Law reads, “Where foreign nations violate international law and basic norms of international relations to contain or suppress our nation under any kind of pretext or based on the laws of those nations to employ discriminatory restrictive measures against our nation’s citizens or interfere with our nation’s internal affairs, our nation has the right to employ corresponding countermeasures.”

Article 7 of the Regulations reads:
The seizure, detention, and freezing referred to in Paragraph 2 of Article 6 of the Anti-Foreign Sanctions Law shall be implemented by the public security, finance, natural resources, transportation, customs, market supervision, financial management, intellectual property and other relevant departments of the State Council in accordance with their duties and powers.
Other types of property in Article 6, Paragraph 2 of the Anti-Foreign Sanctions Act include cash, bills, bank deposits, securities, fund shares, equity, intellectual property rights, accounts receivable and other property and property rights.

Relevant Articles of Law follow:
Article 3: The People’s Republic of China opposes hegemony and power politics and opposes any country’s interference in China’s internal affairs by any means and under any pretext.
Where foreign nations violate international law and basic norms of international relations to contain or suppress our nation under any kind of pretext or based on the laws of those nations to employ discriminatory restrictive measures against our nation’s citizens or interfere with our nation’s internal affairs, our nation has the right to employ corresponding countermeasures.
Article 4: The relevant departments of the State Council may decide to enter persons or organizations that directly or indirectly participate in the drafting, decision-making, or implementation of the discriminatory restrictive measures provided for in article 3 of this Law in a countermeasure list.
Article 5: In addition to the individuals and organizations listed on the countermeasure list in accordance with Article 4 of this Law, the relevant departments of the State Council may also decide to employ countermeasures against the following individuals and organizations:
(1) The spouses and immediate relatives of individuals listed on the countermeasure list;
(2) Senior managers or actual controllers of organizations included in the countermeasures list;
(3) Organizations in which individuals included in the countermeasure list serve as senior management;
(4) Organizations in which persons included in the countermeasure list are the actual controllers or participate in establishment and operations;
Article 6: In accordance with their respective duties and division of labor, the relevant departments of the State Council may decide to employ one or more of the following measures against the individuals and organizations provided for in Articles 4 and 5 of this Law, based on the actual situation:
(1) Not issuing visas, denying entry, canceling visas, or deportation;
(2) Sealing, seizing, or freezing movable property, real estate, and all other types of property within the [mainland] territory of our country;
(3) Prohibiting or restricting relevant transactions, cooperation, and other activities with organizations and individuals within the [mainland] territory of our country;
(4) Other necessary measures.

The full text of the Regulations is available here (Chinese only). A translation of the Anti-Foreign Sanctions Law is available from NPC Observer here.

FTC’s Consumer Protection Agenda Thus Far Under President Trump

As contemplated by FTC defense lawyer in December 2024, the Federal Trade Commission’s operations during the first two months under the second Trump Administration have been chaotic. Unsurprisingly, the policy focus appears to be de-regulation and an enforcement focus on bread-and-butter fraud and deception (for example and without limitation, bogus business opportunity offers, unsubstantiated earnings claims and unlaw debt collection), privacy, telemarketing, big technology moderation and the protection of competition in labor markets.
Last week, President Trump fired the remaining two Democratic commissioners. Both have stated that they believe their termination is unlawful and may challenge the dismissals judicially. Two Republican commissioners remain to make regulatory, investigation and enforcement-related decisions.
The Federal Trade Commission has traditionally been considered an independent agency. However, President Trump recent issued an Executive Order seeking to vest control of various federal agencies and financial regulator within his control, including the FTC. In doing so, the Trump administration seemingly seeks to exert some degree of control over the strategic priorities of the agencies and regulators.
Historically, an FTC commissioner may only be removed by the President for “inefficiency, neglect of duty or malfeasance in office.” In fact, in Humphrey’s Executor v. United States (1935), the Supreme Court ruled that FTC commissioners cannot be removed over policy differences.
Importantly, however, in Selia Law v. CFPB (2019), the Supreme Court held that restricting removal of the Consumer Financial Protection Bureau director to “for cause” only is unconstitutional. Justices Thomas and Gorsuch concurred and criticized the Humphrey’s Executor decision. It is anticipated that, if challenged, the Trump Administration will rely upon the Selia Law decision in support of its position that the removal of the FTC commissioners is constitutional.
Many have noticed a considerable shift in consumer protection investigation and enforcement-related activities. A few new enforcement matters have been initiated in 2025 whilst one or more investigations and lawsuits have been paused. Whether the current slowdown is temporary while the agency aligns its priorities with the new administration’s policies, or is an indication of a more significant long term shift remains to be seen.
Also noteworthy is a brief recently filed in the Eighth Circuit by the FTC defending the “Click to Cancel” Negative Option Rule. Numerous business groups have filed challenges to the rule in federal court. Many have speculated the “Click to Cancel” Rule would face significant challenges by the Trump administration. The “Click to Cancel” Rule’s misrepresentation restrictions are already effective and the remainder of the rule is supposed to become effective in May 2025.

FTC Signals Strong Stance on Civil Investigation Demands

In a March 10 blog post, the new Director of the FTC’s Bureau of Consumer Protection (BCP) reaffirmed the agency’s commitment to enforcing consumer protection laws through Civil Investigation Demands (CIDs). 
A CID is a legally enforceable demand requiring recipients to provide requested documents, testimony, reports, or other information. The FTC issues CIDs to entities and individuals it believes may have violated the law, as well as to third parties who may possess relevant information.
The FTC expects full and timely compliance with CIDs, and failure to respond can lead to legal action, including judicial enforcement. While BCP may work with recipients to tailor requests or adjust response deadlines, recipients must initiate such discussions well in advance. Additionally, recipients are generally required to meet with FTC staff soon after receiving a CID. Although this requirement can be waived, the meeting provides a crucial opportunity to raise and address any compliance challenges.
Putting It Into Practice: The new BCP Director’s first blog post since his appointment highlights the FTC’s continued focus on financial institutions and fintech companies that engage with consumers. Businesses and individuals that receive a CID should

Act Promptly: Track all deadlines and contact the FTC staff identified in the CID to discuss compliance.
Seek Legal Counsel: Consult with experienced legal counsel to ensure appropriate and timely responses.
Engage Cooperatively: Proactively communicate with the FTC, as the agency may consider adjustments to requests or deadlines.

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Federal Circuit Opens the Door to Additional Domestic Industry Investment: “Ordinary Importer” No Longer

In its recent decision in Lashify, Inc. v. International Trade Commission, the Federal Circuit opened the door for patent owners to include expanded categories of domestic investment to satisfy the economic prong of the domestic industry requirement under Section 337(a)(3)(B). App. No. 2023-1245, Opinion (Mar. 5, 2025). Post-manufacture activities that previously were not considered—like sales, marketing, warehousing, quality control, and distribution—are now likely includable as domestic industry investments for purposes of establishing a domestic industry under Section 337(a)(3)(B). This is a significant departure from International Trade Commission (ITC) precedent and will likely open the door to a greater number of ITC investigations involving foreign-manufactured articles.
One of the unique aspects of ITC practice is its requirement that the complainant prove the existence of a domestic industry in order to obtain the coveted exclusion order. This requirement involves two prongs—the technical prong, which requires the complainant prove that it practices the patent at issue; and the economic prong, which requires the complainant prove with respect to the articles protected by the patent: (A) significant investment in plant and equipment; (B) significant employment of labor or capital; or (C) substantial investment in exploitation, including engineering, research and development, or licensing. 19 U.S.C. § 1337(a)(3). The Federal Circuit’s decision in Lashify addressed the economic prong.
Since its enactment in 1988, the ITC’s interpretation of Section 337(a)(3)(B) has effectively barred domestic investments directed solely to post-manufacture activities such as sales, marketing, warehousing, quality control, and distribution from establishing the existence of a domestic industry. The ITC often referred to these activities as those of an “ordinary importer,” failing to alone meet the economic prong of the domestic industry requirement because such activities contribute nothing to the actual manufacture of the article. Where manufacture of the article occurs outside of the United States, no additional steps occur in the United States to make the article salable, and thus no cognizable domestic industry activities remain for purposes of establishing the economic prong. Over the years, this interpretation of Section 337(a)(3) has effectively required some form of domestic manufacture or assembly activity to satisfy the economic prong of the domestic industry requirement. This is likely not the case anymore.
Lashify sells artificial eyelash extensions, applicator tools and products, and lash-extension storage containers. While Lashify conducts research and development in the United States, it manufactures its products overseas and ships them to U.S. customers who purchase the products via Lashify’s website. Customers are then able to use a variety of Lashify-provided resources to apply them, such as educational videos on social media, online chats, and video-call sessions. Lashify owns patents directed to these products, including a least one utility patent directed to, for example, certain lash-fusion technology; and design patents directed to, for example, a certain storage cartridge for eyelash extensions. Lashify filed a complaint before the ITC, in which it alleged that importers of similar products were violating Section 337 by infringing these patents.
The Administrative Law Judge (“ALJ”) at the ITC denied Lashify relief under the statute, determining, inter alia, that Lashify did not satisfy the economic prong of the domestic industry requirement. In reaching this determination, the ALJ excluded expenses relating to sales, marketing, warehousing, quality control, and distribution, following decades of ITC precedent considering these investments alone insufficient to meet the economic prong of the domestic industry requirement. The ALJ reasoned that because there were “no additional steps required to make these products saleable” upon arrival into the United States, and because the quality control measures were “no more than what a normal importer would perform upon receipt,” no domestic industry existed under Section 337(a)(3)(B).
The Commission agreed to review the ALJ’s decision and affirmed. The majority agreed with the ALJ that Lashify had not satisfied the economic prong of the domestic industry requirement, reasoning that “it is well settled that sales and marketing activities alone cannot satisfy the domestic industry requirement.” The majority reached the same conclusion with respect to warehousing, quality control, and distribution.
Lashify appealed to the Federal Circuit. The Federal Circuit vacated the ITC’s determination and remanded the investigation to the ITC for redetermination of satisfaction of the economic prong of the domestic industry requirement. The Federal Circuit concluded that the ITC’s determination relied upon an incorrect interpretation of Section 337(a)(3)(B). The Federal Circuit rejected the ITC’s conclusion that Lashify’s analysis was “overinclusive and not supported” because it “included expenses related to warehousing, distribution, and quality control” as well as “sales and marketing expenses.” The Federal Circuit found no support for these categorical exclusions in the text of the statute, relying heavily on its plain text and a thorough review of the legislative history surrounding the 1988 enactment.
The Federal Circuit observed that the provision “straightforwardly states that domestic industry ‘shall be considered to exist if there is in the United States, with respect to the articles protected by the patent . . . concerned, . . . significant employment of labor and capital.’” 19 U.S.C. § 1337(a)(3)(B). Absent some limitation, the Federal Circuit concluded:
[T]he provision covers significant use of “labor” and “capital” without any limitation on the use within an enterprise to which those items are put, i.e., the enterprise function they serve. In particular, there is no carveout of employment of labor or capital for sales, marketing, warehousing, quality control, or distribution. Nor is there a suggestion that such uses, to count, must be accompanied by significant employment for other functions, such as manufacturing. The Commission’s holdings attribute limitations to clause (B) not found there.

The Federal Circuit went on to conclude that there was no other rationale for imparting a categorical limitation to Section 337(a)(3)(B), precluding reliance on these types of investments from the context of the statute or its legislative history. The Federal Circuit thus directed the ITC, on remand, to “count Lashify’s employment of labor and capital even when they are used in sales, marketing, warehousing, quality control, or distribution, and the Commission must make a factual finding of whether those qualifying expenses are significant or substantial based on ‘a holistic review of all relevant considerations.’”
The Federal Circuit’s decision in Lashify is likely to have a significant impact on ITC practice. Foremost, it is likely to make the ITC available to businesses and industries previously excluded from the venue on the basis of the foreign manufacture of the imported article. Now, foreign manufacture of the article is not likely to be a bar to a patent owner’s ability to claim significant or substantial domestic investment in labor and capital under Section 337(a)(3)(B), even when such labor and capital is devoted to activities that do not make the product saleable or amount to anything more than those post-manufacture activities performed by an ordinary importer. Companies who perform such purely post-manufacture activities—as long as such investments are significant—will have the ability to claim such activities constitute domestic investment for purposes of meeting the economic prong of the domestic industry under Section 337(a)(3)(B).

President Trump Issues Executive Order Promoting Domestic Mineral Production

On March 20, 2025, President Donald Trump signed a sweeping executive order promoting mining and processing of “critical minerals” in the United States. The order – Immediate Measures to Increase American Mineral Production – directs agencies of the federal government to prioritize and expedite permitting for mining and mineral processing projects, invoking the Defense Production Act among and other authorities. Key provisions include:
Expanded Critical Minerals List
For purposes of the order, “critical minerals” include uranium, copper, potash, and gold, in addition to the existing list of critical minerals designated by the secretary of the interior pursuant to the Energy Act of 2020 (30 U.S.C. § 1606(a)(3). Further, the order grants authority to Interior Secretary Doug Burgum, who serves as chair of the National Energy Dominance Council (NEDC), to add “any other element, compound, or material” to the critical minerals list.
Priority Projects
The order directs permitting agencies to identify all mine and mineral processing projects awaiting federal approvals, to issue permits and approvals immediately where possible, and to expedite all permitting activities. The NEDC is to identify mine and mineral processing projects for inclusion in the expedited permitting procedures available under the Fixing America’s Surface Transportation (FAST) Act (41 U.S.C. § 41003), and the Permitting Council must add the identified projects to the FAST Act Permitting Dashboard within 30 days of the order.
Mining the Primary Land Use
The Interior Secretary is instructed to provide a list of all federal lands known to contain mineral “deposits and reserves.” Mining and mineral processing are to be prioritized as the primary land use on these lands. Federal land managers are required to revise land use plans to align with the executive order’s directives.
Permitting Reform
To address regulatory inefficiencies, Interior Secretary Burgum, in his role as NEDC chair, is directed to publish a request for information seeking industry input on “regulatory bottlenecks” and “recommended strategies for expediting domestic mineral production.” The order further instructs the NEDC to develop legislative recommendations to clarify the treatment of mine waste disposal on federal lands under the Mining Law. This direction aims to address permitting delays and uncertainty stemming from Center for Biological Diversity v. U.S. Fish & Wildlife Service, 33 Fed. 4th 1202 (9th Cir. 2022) (commonly referred to as the “Rosemont” decision).
Defense Production Act
The order delegates Defense Production Act authority to the secretary of defense to facilitate domestic mineral production. Mineral production is to be added to the Defense Department’s Industrial Base Analysis and Sustainment Program as a priority area. The defense secretary is also directed to work with the International Development Finance Corporation to use financing authorities and mechanisms to advance mineral production, including the creation of a dedicated mineral production fund.
Unneeded Federal Lands for Mining Projects
The secretaries of defense, energy, interior, and agriculture are tasked with identifying sites on “unneeded” federal lands within their jurisdiction that are suitable for “leasing or development” under the authority of 10 U.S.C. § 2667 (Defense), 42 U.S.C. § 7256 (Energy), or other applicable authorities (Interior and Agriculture).

A Delay in Exit Plans

There was much hope going into 2025 that we would see a rebound in the IPO market after a bit of a drought over the past few years. We left the uncertainty of the election behind us, and good news on the inflation and interest rate fronts were fueling a sense of hope that 2025 was going to be a great year for the IPO market. However, at almost three months into the new year, it is looking like that rebound might be delayed a little longer.
The Wall Street Journal reports that the market volatility we are currently seeing is going to make IPO pricing a “monumental challenge,” and the IPO recovery that venture investors have been waiting on is on hold. The market is reacting to the threats of tariffs and a trade war, as well as recent talks of a recession, and the WSJ says this is keeping some companies on the sidelines as they delay their exit plans.
Yahoo! Finance cites data from Dealogic indicating that the total value of US IPOs is up 62%, coming in at $10 billion as of March 11 – almost double the number of deals compared to the same period in 2024. However, this is still well lower than the kinds of numbers we were seeing in the boom of 2021.
There are some companies who have already gone public this year, with six venture backed IPO’s as of mid-March. And there are still some on track, at least as of now, for the second quarter. Klarna and CoreWeave both filed an IPO prospectus this month, but those plans could be derailed if the market continues its roller coaster ride. Others have already put their plans on hold.
And it is not just IPOs that are delayed – mergers & acquisitions (M&A) are also off to an extremely slow start this year despite expectations that there would be more robust activity this year. PitchBook data show that “US M&A volumes in January were the lowest they’ve been in 10 years, and February wasn’t rosy either.” They point to antitrust policy, market turmoil, and “price mismatches” as contributing factors here. The leadership at the DOJ and FTC also remains critical of Big Tech, so many of those players are sitting on the sidelines which has slowed down dealmaking considerably.
Only time will tell how the back and forth on tariffs will play out, but they are certainly having an impact on the market now and could have longer term impacts that further delay exit plans. A recent article in Forbes notes that the “market’s long-term response to tariffs depends largely on adaptability—how quickly companies can adjust supply chains, pass costs to consumers, or find alternative markets.” But how quickly companies can pivot remains to be seen, and timing will be critical for market stability and for transactions to resume.
There is certainly still hope that successful trade negotiations could end this tariff battle, but there are still fears about the current state of the economy and the potential for a recession. The world is watching closely to see how all of this shakes out, as is everyone sitting on the sidelines planning their next move.
Given that the pre-IPO planning process can be lengthy, and we know that better planning leads to better performance (and that lack of planning leads to poor results), companies and financial sponsors should be getting their ducks in a row for an anticipated IPO market window opening soon, perhaps as early as May 2025.

Trump Fires Two Commissioners and Solidifies Control Over FTC

On March 18, 2025, President Donald Trump removed the two remaining Democrats serving on the Federal Trade Commission (FTC), Rebecca Slaughter and Alvaro Bedoya.
Commissioners Slaughter and Bedoya, whose terms were not due to expire until September of 2029 and 2026, respectively, declared the firings illegal and vowed to sue to get their jobs back.
By statute, the FTC is headed by five Commissioners, no more than three of whom can represent the political party in power. At present, however, and with the announcement of the firing of Commissioners Slaughter and Bedoya, only two Commissioners remain, Chair Andrew Ferguson and Commissioner Melissa Holyoak, both Republicans. President Trump’s nomination of Mark Meador has been approved by the Senate Commerce Committee but awaits confirmation by the full Senate.
Although the removal of these Commissioners effectively eliminates the current deadlock at the FTC, it is unclear whether the FTC can effectively operate with only two Commissioners. Furthermore, the legality of the firings will surely be questioned, as might any actions made by the remaining Commissioners.

President Trump Fires Two Democratic FTC Commissioners

Key Takeaways

Potential Legal Battle Over Presidential Authority. President Trump’s firing of the two Democratic FTC commissioners challenges old and new U.S. Supreme Court precedent interpreting the FTC Act’s terms, which allows the president to remove FTC commissioners only for “insufficiency, neglect of duty or malfeasance in office.” Advocates of the so-called “unitary executive” theory have reportedly been seeking grounds to challenge the limit on presidential power presented by Humphrey’s Executor and Seila Law, hoping the currently constituted Supreme Court might overrule this longstanding precedent.
Impact on FTC’s Composition and Competition Enforcement Direction. With the removal of the two Democratic commissioners and the anticipated confirmation of Republican nominee Mark Meador, the FTC will have a 3–0 Republican majority. This will give these Republican appointees complete control over approving future enforcement actions and also empower them to abandon existing FTC actions that they may not support, such as defending the FTC’s noncompete rule.
Consumer Protection Focus. Despite the Commission’s composition changes, the FTC’s consumer protection mission is expected to remain largely unchanged under Chairman Ferguson. The agency will likely focus on enforcing existing laws rather than pursuing new rulemaking efforts, particularly in privacy, data security and technology. Children’s privacy will continue to be a priority.

On March 18, President Donald Trump fired the Democratic commissioners, Rebecca Slaughter and Alvaro Bedoya, from the Federal Trade Commission (FTC). This leaves two Republicans, Chairman Andrew Ferguson and Melissa Holyoak, and a Republican nominee, Mark Meador. However, the dismissal of two Democratic commissioners runs contrary to decades of precedent at the FTC and apparently tees up a battle over presidential control over so-called “independent” federal agencies that seems headed to the U.S. Supreme Court.
The FTC is an executive agency, but it is called “independent” because it is not under the oversight of a cabinet secretary. Since its inception in 1915, it has operated independently with five commissioners — by statute, no more than three from one party (i.e., the president’s party) and two from the other party. According to the FTC Act, the president may nominate the commissioners, who are then subject to Senate approval. The commissioners serve staggered terms, so they are not hired or fired simultaneously and often work across administrations. Traditionally, however, upon a change of administration, the current chair resigns to enable the president to appoint a new commissioner, giving the president’s party a majority on the Commission.
The independent agency rubric, under which the FTC has operated for many decades, has more recently come under fire for its purported insulation from presidential oversight. In other words, if the rubric is constitutional, the president may not fire commissioners absent “cause.” The president can choose to appoint other agency heads purely from their own party, but for FTC commissioners, he must maintain a split-party Commission, which functions independently.
White House to Approve Regulations from Independent Agencies
In February, President Trump issued an Executive Order to “rein in” independent agencies. The Order states that Article II of the US Constitution vests all executive power in the president, meaning that all executive branch officials and employees are subject to his supervision. Accordingly, all agencies must: (1) submit draft regulations for White House review — with no carve-out for so-called “independent agencies,” except for the monetary policy functions of the Federal Reserve; and (2) consult with the White House on their priorities and strategic plans, and the White House will set their performance standards. The Office of Management and Budget (OMB) is tasked with budget oversight, and the president and attorney general (subject to the president’s supervision and control) will provide authoritative interpretations of law for the executive branch.
Humphrey’s Executor Precedent and Presidential Oversight
The president’s attempt to fire the two Democratic commissioners appears to contravene the language of the FTC Act itself as well as old and new Supreme Court precedent interpreting its terms. The FTC Act limits the president’s ability to fire an FTC commissioner to “insufficiency, neglect of duty or malfeasance in office.” In Humphrey’s Executor v. United States, 292 U.S. 602 (1935), the Supreme Court addressed a challenge to President Franklin D. Roosevelt’s firing of FTC Commissioner William Humphrey for political reasons. The Court distinguished between the president’s authority over ordinary executive officers and what it called “quasi-legislative” or “quasi-judicial” officers. The Court held that FTC commissioners fell into that class of officers and could be removed only with procedures consistent with statutory conditions enacted by Congress.
In 2020, in Seila Law, LLC v. Consumer Financial Protection Bureau, the Supreme Court affirmed that this is one of the only remaining narrow restrictions on a president’s authority to remove officers. Humphrey’s Executor, it explained, allowed “Congress to give for-cause removal protections to a multimember body of experts, balanced along partisan lines, that performed legislative and judicial functions and was said not to exercise any executive power,” essentially limiting it to the facts of that case. 591 U.S. 197, 216 (2020).
Advocates of the so-called “unitary executive” theory have reportedly been seeking a basis to challenge the limit on presidential power embodied in Humphrey’s Executor and, more recently, Seila Law, hoping that the currently constituted Supreme Court might overrule this longstanding precedent. Indeed, Humphrey’s Executor only narrowly survived the Court’s 5–4 decision in Seila Law in 2020. Another case already in progress involves the president’s firing of National Labor Relations Board (NLRB) members, which is currently before the DC Circuit and seems to have a head start on the objective of putting Humphrey’s Executor before the Supreme Court again. A new Supreme Court ruling on this issue could have profound implications for all independent agencies — not just the FTC.
What Does this Mean for the FTC?
In the near term, the firings seem to portend the following at the FTC:
Commissioners Slaughter and Bedoya have publicly stated that they will challenge their firings in court and that, for now, they consider themselves still part of the FTC. While their immediate status is unclear, it does not seem likely that they would be able to continue in their positions without court intervention. Chairman Ferguson supported President Trump’s authority to remove them and had already referred to Slaughter and Bedoya as “former commissioners.”
Practically speaking, the firings could impact the FTC’s decisions in certain competition enforcement actions. Assuming nominee Mark Meador is confirmed and joins the Commission in the near future, the FTC will have a 3–0 Republican majority. This will give these Republican appointees complete control over approving future enforcement actions. The change may also empower the new Republican majority to abandon existing FTC actions they may not support, such as defending the FTC’s noncompete rule, currently on appeal before the Fifth Circuit and the Eleventh Circuit.
We see little change to the agency’s consumer protection mission and priorities, as articulated by Chairman Ferguson. We anticipate the agency will shift its focus to enforcing existing laws rather than pursuing rulemaking efforts related to privacy, data security and technology. However, the advocacy of the former Democratic commissioners to regulate data brokers, biometric technology and artificial intelligence (AI) may take a different shape now. Ferguson will likely focus on enforcing existing laws against AI without hindering innovation in this area. Interestingly, Ferguson has also been more aggressive, proposing to inquire into tech platforms’ alleged “censorship.” Children’s privacy continues to be a priority, and Commissioner Ferguson has already indicated that the FTC may make more changes to the recently amended Children’s Online Privacy Protection Rule.