- within Consumer Protection and Real Estate and Construction topic(s)
Enforcement
Patent disputes are often framed around familiar questions: Did the defendant infringe? Is the patent valid? What remedies are available? Today, products are often manufactured abroad and enter the United States through complex networks of importers, distributors, and marketplace sellers. In an economy built on global supply chains, patent owners are faced with an increasingly important question: Which forum can actually stop the harm? Section 337 of the Tariff Act of 1930 provides the International Trade Commission ("ITC") with a distinctive answer. After the Federal Circuit's 2025 decision in Lashify, Inc. v. ITC, more patent owners may be positioned to seek relief from the ITC.
Why District Court Litigation May Be Incomplete in Import-Driven Disputes
District courts resolve conflicts between identified parties. This structure works well in many patent cases, but it can be less effective when the alleged infringement is tied to imported products moving through complex international supply chains. A patent owner in district court must establish both personal jurisdiction and proper venue before a decision can be made, and the relief granted typically consists of money damages and extends only to the parties before the court. Even when a patent owner prevails and is granted injunctive relief, party-specific relief may not fully solve the problem if the same or similar products continue entering the country through new importers, affiliated entities, or marketplace sellers.
The ITC addresses this problem. 19 U.S.C. § 1337(a) authorizes the ITC to regulate unfair import trade, and this authority extends to articles that infringe U.S. patents. This distinction matters. Practically, the ITC's authority is directed at the imported articles themselves, not the parties named in a proceeding. This makes the forum particularly well-suited for disputes where the harm arises from goods with fragmented or shifting supply channels.
What Makes the ITC Different
The ITC cannot award money damages. Therefore, to accomplish its goal under Section 337, the ITC frequently grants exclusion orders and cease-and-desist orders. Exclusion orders bar the import of products into the U.S., and their scope depends on the type of order entered.
The ITC grants two types of exclusionary orders after hearing a case: limited exclusion orders and general exclusion orders. A limited exclusion order applies to the parties found to violate Section 337. This is the typical form of relief granted and is often sufficient when the infringing manufacturers and importers are identified. However, a limited exclusion order may not be enough in markets characterized by numerous foreign sources, white-label products, or hard-to-track import channels.
This is where the general exclusion order shines. A general exclusion order reaches the product level and prevents the import of all infringing products regardless of source. General exclusion orders are granted where it is difficult to determine the source of infringing products, or to prevent parties from avoiding enforcement of a limited exclusion order. 19 U.S.C. §§ 1337(d)(2), (g)(2).
Lashify and the Domestic-Industry Inquiry
The ITC's power to stop the import of patent-infringing articles is not available to all patent owners. The ITC can act only if "an industry in the United States, relating to the articles protected by the patent . . . exists or is in the process of being established." 19 U.S.C.A. § 1337(a)(2). Section 337 further provides that an industry exists if, with respect to the protected articles, there is "(A) significant investment in plant and equipment; (B) significant employment of labor or capital; or (C) substantial investment in [the patent's] exploitation, including engineering, research and development, or licensing" in the United States. 19 U.S.C.A. § 1337(a)(3). This inquiry is known as the "domestic-industry requirement," which has two prongs: the "technical prong" and the "economic prong." The technical prong is used to determine whether a complainant or its licensee practices at least one claim of each asserted patent, while the economic prong asks whether there is sufficient U.S. investment related to the complainant's (or its licensee's) product that practices the asserted patent, under one of the three categories listed above. InterDigital Commc'ns, LLC v. Int'l Trade Comm'n, 707 F.3d 1295, 1298 (Fed. Cir. 2013).
This is where Lashify changes the legal landscape: By expanding the economic prong of the domestic-industry requirement, Lashify opened ITC proceedings to companies that previously may not have been able to satisfy that prong. See Lashify, Inc. v. Int'l Trade Comm'n, 130 F.4th 948, 951 (Fed. Cir. 2025), amended, No. 2023-1245, 2026 WL 293128 (Fed. Cir. Feb. 4, 2026). Before Lashify, the ITC took a narrower view of the economic prong of domestic industry under 19 U.S.C. § 1337(a)(3)(B), treating expenditures such as sales, marketing, warehousing, quality control, and distribution as insufficient on their own—especially where manufacturing occurred abroad. See In the Matter of Certain Artificial Eyelash Extension Sys., Prods., & Components Thereof Comm'n Opinion, USITC Inv. No. 337-TA-1226 (Oct. 24, 2022). In Lashify, the Federal Circuit rejected that approach, holding that the statute contains no carve-out limiting what "significant employment[] of labor or capital" includes based on the function of that labor or capital. Lashify, 130 F.4th at 958–59. The Federal Circuit held that the ITC must consider all labor and capital expended regardless of whether they are directed toward sales, marketing, warehousing, quality control, or distribution—even when there is no domestic manufacturing. Id.
This holding matters because it aligns with the way many modern-day companies operate. U.S. companies often rely on foreign manufacturing while maintaining substantial domestic operations for warehousing, logistics, distribution, and quality assurance. After Lashify, companies that previously assumed the ITC was unavailable unless they also manufactured in the United States may reconsider that assumption.
What Lashify Could Mean for a Company's IP Practice
For companies managing patent portfolios, Lashify may affect more than litigation strategy. Companies that manufacture abroad but have substantial domestic investments in warehousing, quality control, logistics, marketing, and distribution may now have a stronger basis to consider the ITC as part of their patent-enforcement toolkit. The ITC still will not be the right forum for every IP dispute, but the Lashify decision likely expands the availability of ITC litigation to patent and other IP owners who had not previously considered the ITC as a forum. In practice, that means in-house IP teams may need to evaluate domestic-industry evidence earlier and more systematically than before, and companies should be tactical in assessing the remedies that best serve their IP interests.
Conclusion
For companies confronting infringement in global supply chains, Lashify may expand the possibilities for forum selection. By rejecting the ITC's long-standing exclusion of sales, marketing, warehousing, quality control, and distribution expenditures from the domestic-industry analysis in the absence of other cognizable domestic investments, the Federal Circuit expanded access to Section 337 for businesses that manufacture abroad but maintain substantial U.S. commercial operations. Companies and counsel considering the most effective way to protect their patent rights in the rapidly changing economic and trade environment should consider the possibility of a Section 337 investigation at the ITC. Conversely, companies that import goods into the U.S. should reassess their competitive landscape to determine whether competitors or licensing entities that previously could not satisfy the domestic-industry requirement now pose a threat to their operations.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
