Later this month, Adminstrative Law Judge David P. Shaw is expected to issue an Initial Determination in In the Matter of Certain Wireless Devices with 3G Capabilities and Components Thereof (Inv. No. 337-TA-800), which is the ITC’s Section 337 investigation into InterDigital’s allegations of 3G-essential patent infringement by Huawei, LG Electronics, Nokia, and ZTE. The upcoming ID, though, will only relate to infringement accusations against Huawei, Nokia, and ZTE — as LG had previously been terminated from the case in July 2012. LG had been dismissed from the ITC case because LG claimed that InterDigital’s infringement allegations were an “arbitrable dispute” covered by a license agreement between the parties, and that an arbitrator — not the ITC — should decide the infringement issues. Once the ITC terminated LG from the case, InterDigital appealed this ruling to the Federal Circuit.
Today, in a 2-1 opinion [LINK] written by Judge Sharon Prost (joined by Judge William Bryson, with Judge Alan Lourie dissenting), the Federal Circuit reversed the ITC’s decision and remanded the case to the ITC for further proceedings. The court held that the ITC erred in terminating LG from the investigation, because the ITC failed to analyze the text of the license agreement to determine whether LG’s arguments regarding the arbitrability of the infringement dispute were “wholly groundless.” Furthermore, the court found that when the text of the agreement was actually considered, LG’s assertions were indeed “wholly groundless,” and the infringement claims were not subject to arbitration.