On September 3, 2021, Chief ALJ Charles E. Bullock issued the public version (see Part I, Part II, Part III) of Order No. 24 granting Complainants Hydro Flask Steel Technology, LLC d/b/a Hydro Flask and Helen of Troy Limited's (collectively, "Hydro Flask") motion for summary determination of violation of section 337 in Certain Vacuum Insulated Flasks and Components Thereof (Inv. No. 337-TA-1216).
By way of background, this investigation was instituted on August 28, 2020 based on Hydro Flask's complaint alleging violations of section 337 by Respondents Cangnan Kaiyisi E-Commerce Technology Co., Ltd.; Shenzhen Huichengyuan Technology Co., Ltd.; Sinbada Impex Co., Ltd.; Yongkang Huiyun Commodity Co., Ltd.; Wuyi Loncin Bottle Co., Ltd.; Zhejiang Yuchuan Industry & Trade Co., Ltd.; Zhejiang Yongkang Unique Industry & Trade Co., Ltd.; Suzhou Prime Gifts Co., Ltd.; Hangzhou Yuehua Technology Co., Ltd.; Guangzhou Yawen Technology Co., Ltd.; Jinhua City Ruizhi E-Commerce Co., Ltd.; Wo Ma Te (Tianjin) International Trade Co., Ltd.; and Shenzhen City Yaxin General Machinery Co., Ltd. (collectively, "Respondents") and seeking a general exclusion order ("GEO") due to the infringement of U.S. Design Patent Nos. D806,468; D786,012; and D799,320; and U.S. Trademark Registration Nos. 4,055,784; 5,295,365; 5,176,888; and 4,806,282. The asserted patents relate to vacuum insulated flasks made of stainless steel and caps for such flasks, including round caps with a strap secured on either side of the cap and straw caps.
According to the order, ALJ Bullock determined that the economic prong of the domestic industry requirement was satisfied based on Hydro Flask's evidence of investment in three facilities that were locations for "engineering, product development and design, quality assurance, research and development, and new product activities" for the domestic industry products. Hydro Flask also produced evidence of investments in equipment related to the domestic industry products, which the ALJ found was "necessary for all aspects of product development, engineering, production, and assembly, marketing, and sales of" the domestic industry products. ALJ Bullock also found that the technical prong was met based on evidence that Hydro Flask's domestic industry products practiced the claimed designs.
None of the Respondents, who defaulted, challenged the validity of the asserted patents. With respect to patent infringement, Hydro Flask claimed that Respondents infringe by importing "caps and lids that are either identical in appearance or at least substantially the same in appearance to the Asserted Patents' designs." ALJ Bullock determined that the overall appearance of the products were substantially the same as those claimed by the asserted patents' designs and therefore infringed. With respect to trademark infringement, the ALJ found that the accused products infringed the asserted trademarks based on evidence showing that consumers were likely to be confused by the products' use of similar marks, especially given that the products were marketed and sold in similar trade channels.
As to the remedy, ALJ Bullock determined that a GEO was necessary to prevent circumvention of a limited exclusion order ("LEO") and to remedy the widespread pattern of unauthorized use. For example, Hydro Flask identified "tens of thousands" of sales on the Internet through numerous online marketplaces. Many such marketplaces had anonymous storefronts with no identifying information as to the sellers and buyers of the accused products. The evidence also showed that Respondents could easily circumvent a LEO by changing their storefront name, providing a false address, masking their identity, etc. Further, the evidence showed a widespread pattern of infringement, despite Hydro Flask's extensive enforcement activities.
Because Respondents defaulted and therefore waived their right to contest Hydro Flask's allegations, ALJ Bullock also recommended issuance of a LEO covering Respondent's products found to infringe the asserted patents and trademarks. Hydro Flask also requested cease-and-desist orders ("CDOs") directed against each of the Respondents, but the ALJ determined that CDOs were not warranted given that none of the defaulting Respondents are located in the United States and do not have domestic operations or "commercially significant" inventory.
With respecting to bonding, the ALJ agreed with Hydro Flask that the bond value should be set at 100%.
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