A recent International Trade Commission (ITC) case shows that, although rarely used, the ITC remains a viable option for parties pursuing trade secret misappropriation claims. Trade secret claims can be brought under Section 337(a)(1)(A)’s catch-all for other “unfair methods of competition and unfair acts in the importation of articles”—often called “non-statutory” claims—and can result in remedies that effectively bar the entry of the offending products into the U.S., or prevent their commercialization to the extent already imported.
On June 27th, 2019, about a month after a Complaint was filed by Illinois Tool Works Inc., the ITC instituted an investigation into a possible Section 337 violation based on trade secret misappropriation. Illinois Tool Works and its Guangzhou-based subsidiary, Vesta, alleged that Vesta employees left to form a new company called Rebenet, taking Vesta’s trade secrets with them. Vesta’s asserted trade secrets fall into two categories: (1) technical—relating to the materials, components, schematics, and tooling used to create Vesta’s foodservice equipment products; and (2) commercial—including Vesta’s customer list, supplier list, and commercial agreement terms. Vesta claims that its more than 20,000 products are “highly customized,” and that competitors could only achieve a similar level of customizability by relying on Vesta’s proprietary and long-developed methods of coding and tracking the various materials and parts. Under the ITC’s statutory charge to conduct investigations expeditiously, the evidentiary hearing will likely take place within about 9 months.
This new case demonstrates the ITC’s continuing broad jurisdiction. It appears from the Complaint that most, if not all, of the acts constituting the alleged trade secret misappropriation took place entirely overseas. Even so, the ITC may still find a Section 337 violation and issue the appropriate exclusionary remedies, as the Federal Circuit held in the landmark decision TianRui Grp. Co. v. Int’l Trade Comm’n, 661 F.3d 1322, 1332 (Fed. Cir. 2011).