81 FR 42377 - Certain Footwear Products; Commission Decision To Affirm-in-Part, Reverse-in-Part, and Vacate Certain Portions of a Final Initial Determination Finding a Violation of Section 337; Issuance of General Exclusion Order; Termination of the Investigation

INTERNATIONAL TRADE COMMISSION

Federal Register Volume 81, Issue 125 (June 29, 2016)

Page Range		42377-42379
FR Document		2016-15339

Notice is hereby given that the U.S. International Trade Commission has determined to affirm-in-part, reverse-in-part, and vacate certain portions of a final initial determination (``ID'') of the presiding administrative law judge (``ALJ'') finding a violation of section 337 in the above-captioned investigation, and has issued a general exclusion order directed against infringing footwear products. The Commission has terminated the investigation.

Federal Register, Volume 81 Issue 125 (Wednesday, June 29, 2016)

[Federal Register Volume 81, Number 125 (Wednesday, June 29, 2016)]
[Notices]
[Pages 42377-42379]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-15339]

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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-936]

Certain Footwear Products; Commission Decision To Affirm-in-Part,
Reverse-in-Part, and Vacate Certain Portions of a Final Initial
Determination Finding a Violation of Section 337; Issuance of General
Exclusion Order; Termination of the Investigation

AGENCY: U.S. International Trade Commission.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the U.S. International Trade
Commission has determined to affirm-in-part, reverse-in-part, and
vacate certain portions of a final initial determination (``ID'') of
the presiding administrative law judge (``ALJ'') finding a violation of
section 337 in the above-captioned investigation, and has issued a
general exclusion order directed against infringing footwear products.
The Commission has terminated the investigation.

FOR FURTHER INFORMATION CONTACT: Clint Gerdine, Esq., Office of the
General Counsel, U.S. International Trade Commission, 500 E Street SW.,
Washington, DC 20436, telephone (202) 708-2310. Copies of non-
confidential documents filed in connection with this investigation are
or will be available for inspection during official business hours
(8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S.
International Trade Commission, 500 E Street SW., Washington, DC 20436,
telephone (202) 205-2000. General information concerning the Commission
may also be obtained by accessing its Internet server at http://www.usitc.gov. The public record for this investigation may be viewed
on the Commission's electronic docket (EDIS) at http://edis.usitc.gov.
Hearing-impaired persons are advised that information on this matter
can be obtained by contacting the Commission's TDD terminal on (202)
205-1810.

SUPPLEMENTARY INFORMATION: The Commission instituted this investigation
on November 17, 2014, based on a complaint filed on behalf of Converse
Inc. of North Andover, Massachusetts. 79 FR 68482-83. The complaint
alleges violations of section 337 of the Tariff Act of 1930, as
amended, 19 U.S.C. 1337, by reason of infringement of certain U.S.
Trademark Registration Nos.: 4,398,753 (``the '753 trademark'');
3,258,103 (``the '103 trademark''); and 1,588,960 (``the '960
trademark''). The

[[Page 42378]]

complaint further alleges violations of section 337 based upon unfair
competition/false designation of origin, common law trademark
infringement and unfair competition, and trademark dilution, the threat
or effect of which is to destroy or substantially injure an industry in
the United States. The Commission's notice of investigation named
numerous respondents including Wal-Mart Stores, Inc. of Bentonville,
Arkansas; Skechers U.S.A., Inc. of Manhattan Beach, California; and
Highline United LLC d/b/a Ash Footwear USA of New York City, New York.
The Office of Unfair Import Investigations (``OUII'') is also a party
to the investigation. Id. New Balance Athletic Shoe, Inc. (``New
Balance'') of Boston, Massachusetts was subsequently added as a
respondent-intervenor. See Order No. 36 (unreviewed, Comm'n Notice Feb.
19, 2015). Only these four respondents remain active in the
investigation. All other respondents, as detailed below, have been
found in default or have been terminated from the investigation based
on good cause or settlement and/or consent order stipulation.
On February 10, 2015, the Commission determined not to review an ID
(Order No. 32) granting a joint motion of complainant and Skeanie
Shoes, Inc. (``Skeanie'') of New South Wales, Australia terminating the
investigation as to Skeanie Shoes based on settlement and consent order
stipulation. On the same date, the Commission determined not to review
an ID (Order No. 33) granting a joint motion of complainant and PW
Shoes, Inc. (``PW Shoes'') of Maspeth, New York terminating the
investigation as to PW Shoes based on settlement and consent order
stipulation. Also on the same date, the Commission determined not to
review an ID (Order No. 34) granting a joint motion of complainant and
Ositos Shoes, Inc. (``Ositos Shoes'') of South El Monte, California
terminating the investigation as to Ositos Shoes based on settlement
agreement and consent order stipulation. On March 4, 2015, the
Commission determined not to review an ID (Order No. 52) granting a
joint motion of complainant and Ralph Lauren Corporation (``Ralph
Lauren'') of New York City, New York terminating the investigation as
to Ralph Lauren based on settlement agreement and consent order
stipulation. On March 12, 2015, the Commission determined not to review
an ID (Order No. 55) granting a joint motion of complainant and OPPO
Original Corp. (``OPPO'') of City of Industry, California terminating
the investigation as to OPPO based on settlement agreement and consent
order stipulation. On the same date, the Commission determined not to
review an ID (Order No. 57) granting a joint motion of complainant and
H & M Hennes & Mauritz LP (``H & M'') of New York City, New York
terminating the investigation as to H & M based on settlement agreement
and consent order stipulation. On March 24, 2015, the Commission
determined not to review an ID (Order No. 59) granting a joint motion
of complainant and Zulily, Inc. (``Zulily'') of Seattle, Washington
terminating the investigation as to Zulily based on settlement
agreement and consent order stipulation. On March 30, 2015, the
Commission determined not to review an ID (Order No. 65) granting a
joint motion of complainant and Nowhere Co. Ltd. d/b/a Bape
(``Nowhere'') of Tokyo, Japan terminating the investigation as to
Nowhere based on settlement agreement and consent order stipulation. On
the same date, the Commission determined not to review an ID (Order No.
67) granting a joint motion of complainant and The Aldo Group
(``Aldo'') of Montreal, Canada terminating the investigation as to Aldo
based on settlement agreement and consent order stipulation.
On April 1, 2015, the Commission determined not to review an ID
(Order No. 69) granting a joint motion of complainant and Gina Group,
LLC (``Gina Group'') of New York City, New York terminating the
investigation as to Gina Group based on settlement agreement and
consent order stipulation. On the same date, the Commission determined
not to review an ID (Order No. 70) granting a joint motion of
complainant and Tory Burch LLC (``Tory Burch'') of New York City, New
York terminating the investigation as to Tory Burch based on settlement
agreement and consent order stipulation. On April 24, 2015, the
Commission determined not to review an ID (Order No. 73) granting a
joint motion of complainant and Brian Lichtenberg, LLC (``Brian
Lichtenberg'') of Los Angeles, California terminating the investigation
as to Brian Lichtenberg based on settlement agreement and consent order
stipulation. On the same date, the Commission determined not to review
an ID (Order No. 80) granting a joint motion of complainant and Fila
U.S.A., Inc. (``Fila'') of Sparks, Maryland terminating the
investigation as to Fila based on settlement agreement and consent
order stipulation. On May 4, 2015, the Commission determined not to
review an ID (Order No. 86) granting a joint motion of complainant and
Mamiye Imports LLC d/b/a Lilly of New York located in Brooklyn, New
York and Shoe Shox of Seattle, Washington (collectively, ``Mamiye
Imports'') terminating the investigation as to Mamiye Imports based on
settlement agreement and consent order stipulation.
On May 6, 2015, the Commission determined not to review an ID
(Order No. 83) granting New Balance's motion to terminate the
investigation as to New Balance's accused CPT Hi and CPT Lo model
sneakers based on a consent order stipulation. On May 13, 2015, the
Commission determined not to review an ID (Order No. 93) granting a
joint motion of complainant and Iconix Brand Group, Inc. (``Iconix'')
of New York City, New York terminating the investigation as to Iconix
based on settlement agreement and consent order stipulation. On June 4,
2015, the Commission determined not to review an ID (Order No. 108)
granting a joint motion of complainant and A-List, Inc. d/b/a Kitson
(``Kitson'') of Los Angeles, California terminating the investigation
as to Kitson based on settlement agreement and consent order
stipulation. On June 12, 2015, the Commission determined not to review
an ID (Order No. 114) granting a joint motion of complainant and
Esquire Footwear LLC (``Esquire'') of New York City, New York
terminating the investigation as to Esquire based on settlement
agreement, consent order stipulation, and consent order. On July 15,
2015, the Commission determined not to review an ID (Order No. 128)
granting a joint motion of complainant and Fortune Dynamic, Inc.
(``Fortune Dynamic'') of City of Industry, California terminating the
investigation as to Fortune Dynamic based on settlement agreement and
consent order stipulation. On August 12, 2015, the Commission
determined not to review an ID (Order No. 154) granting a joint motion
of complainant and CMerit USA, Inc. (``CMerit'') of Chino, California
terminating the investigation as to CMerit based on settlement
agreement and consent order stipulation. On August 14, 2015, the
Commission determined not to review an ID (Order No. 155) granting a
joint motion of complainant and Kmart Corporation (``Kmart'') of
Hoffman Estates, Illinois terminating the investigation as to Kmart
based on settlement agreement and consent order stipulation.
Also, on March 12, 2015, the Commission determined not to review an
ID (Order No. 58) finding Dioniso SRL of Perugia, Italy; Shenzhen
Foreversun Industrial Co., Ltd. (a/k/a

[[Page 42379]]

Shenzhen Foreversun Shoes Co., Ltd.) (``Foreversun'') of Shenzhen,
China; and Fujian Xinya I&E Trading Co. Ltd. of Jinjiang, China in
default. Similarly, on June 2, 2015, the Commission determined not to
review an ID (Order No. 106) finding Zhejiang Ouhai International Trade
Co. Ltd. and Wenzhou Cereals Oils & Foodstuffs Foreign Trade Co. Ltd.,
both of Wenzhou, China, in default. Further, on March 25, 2015, the
Commission determined not to review an ID (Order No. 68) granting the
motion of Orange Clubwear, Inc. of Westminster, California to terminate
the investigation as to itself based on a consent order stipulation. On
May 12, 2015, the Commission determined not to review an ID terminating
the investigation as to Edamame Kids, Inc. of Alberta, Canada for good
cause and without prejudice.
The ALJ issued his final ID on November 17, 2015, finding a
violation of section 337 as to certain accused products of each active
respondent and as to all accused products of each defaulting
respondent. Specifically, the ALJ found that the '753 trademark is not
invalid and that certain accused products of each active respondent,
and all accused products of each defaulting respondent, infringe the
'753 trademark. The ALJ also found that: (1) Converse satisfied both
the economic and technical prongs of the domestic industry requirement
with respect to all asserted trademarks; (2) certain accused products
of defaulting respondent Foreversun infringe both the '103 and '960
trademarks; and (3) a violation of section 337 with respect to the '103
and '960 trademarks by Foreversun. The ALJ also found no dilution of
the '753 trademark. The ALJ also issued his recommendation on remedy
and bonding during the period of Presidential review. He recommended a
general exclusion order directed to footwear products that infringe the
asserted trademarks, and recommended cease and desist orders directed
against each active, remaining respondent found to infringe. On
December 4, 2015, complainant, respondents, and the Commission
investigative attorney (``IA'') each filed a timely petition for review
of the final ID. On December 14, 2015, each of these parties filed
responses to the other petitions for review.
On February 3, 2016, the Commission issued notice of its
determination to review: (1) The ID's finding of no invalidity of the
'753 trademark; (2) the ID's findings regarding infringement of the
'753 trademark; (3) the ID's finding of invalidity of the common law
rights asserted in the design depicted in the '753 trademark; and (4)
the ID's finding of no violation of section 337 with respect to the
common law rights asserted in the designs depicted in the '103 and '960
trademarks. The Commission also determined not to review the remainder
of the final ID. The determinations made in the ALJ's final ID that
were not reviewed became final determinations of the Commission by
operation of rule. See 19 CFR 210.43(h)(2). The Commission also
requested the parties to respond to certain questions concerning the
issues under review and requested written submissions on the issues of
remedy, the public interest, and bonding from the parties and
interested non-parties. 81 FR 6886-89 (Feb. 9, 2016).
On February 17 and 24, 2016, respectively, complainant,
respondents, and the IA each filed a brief and a reply brief on all
issues for which the Commission requested written submissions.
Respondents' reply brief included a request for a Commission hearing to
present oral argument under Commission rule 210.45(a). On February 29
and March 3, 2016, respectively, both Converse and the IA each filed a
response to respondents' request, with each accompanied by a motion for
leave to file a sur-reply to the request for oral argument. On March 1,
2016, respondents filed a motion for leave to submit a sur-reply to
their request for oral argument. The Commission has determined to grant
all motions for leave to file sur-replies submitted by the parties, and
to deny respondents' request for a Commission hearing to present oral
argument.
Having reviewed the record in this investigation, including the
ALJ's final ID and the parties' written submissions, the Commission has
determined to affirm-in-part, reverse-in-part, and vacate certain
portions of the final ID's findings under review. Specifically, the
Commission has reversed the ALJ's finding that the '753 trademark is
not invalid, and instead has found the trademark invalid based on lack
of secondary meaning. The Commission has also affirmed the ALJ's
finding that there is a likelihood of confusion with respect to the
'753 trademark for specific accused footwear products if the trademark
was not invalid. The Commission has also affirmed the ALJ's finding
that there is no likelihood of confusion with respect to the '753
trademark for specific accused footwear products regardless of
invalidity. Further, the Commission has affirmed the ALJ's finding that
the asserted common law rights in the '753 trademark are invalid.
Accordingly, the Commission has determined that there is no violation
of section 337 with respect to the '753 trademark. The Commission has
vacated the ALJ's finding that the asserted common law rights in the
designs depicted in the '103 and '960 trademarks are invalid. The
Commission has determined that this finding with respect to these
common law rights is moot in view of the Commission's finding of a
violation with respect to the federally-registered rights in the '103
and '960 trademarks since the scope of the common law and federally-
registered rights in these trademarks is co-extensive. See Comm'n
Notice (Feb. 3, 2016); ID at 107-08, 121-26, 128-29, 131-32.
Having found a violation of section 337 as to the '103 and '960
federally-registered trademarks, the Commission has made its
determination on the issues of remedy, the public interest, and
bonding. The Commission has determined that the appropriate form of
relief is a general exclusion order prohibiting the unlicensed entry of
footwear products that infringe the '103 or '960 trademarks.
The Commission further determined that the public interest factors
enumerated in section 337(d)(1) (19 U.S.C. 1337(d)(1)) do not preclude
issuance of the general exclusion order. Finally, the Commission
determined that a bond of 100 percent of the entered value (per pair)
of the covered products is required to permit temporary importation
during the period of Presidential review (19 U.S.C. 1337(j)). The
Commission has also issued an opinion explaining the basis for the
Commission's action. The Commission's order and opinion were delivered
to the President and to the United States Trade Representative on the
day of their issuance. The investigation is terminated.
The authority for the Commission's determination is contained in
section 337 of the Tariff Act of 1930, as amended, 19 U.S.C. 1337, and
in part 210 of the Commission's Rules of Practice and Procedure, 19 CFR
part 210.

By order of the Commission.

Dated: June 23, 2016.
Lisa R. Barton,
Secretary to the Commission.
[FR Doc. 2016-15339 Filed 6-28-16; 8:45 am]
BILLING CODE 7020-02-P

Federal Register / Vol. 81, No. 125 / Wednesday, June 29, 2016 / Notices 42379

Shenzhen Foreversun Shoes Co., Ltd.) ’753 trademark; and (4) the ID’s finding is no violation of section 337 with
(‘‘Foreversun’’) of Shenzhen, China; and of no violation of section 337 with respect to the ’753 trademark. The
Fujian Xinya I&E Trading Co. Ltd. of respect to the common law rights Commission has vacated the ALJ’s
Jinjiang, China in default. Similarly, on asserted in the designs depicted in the finding that the asserted common law
June 2, 2015, the Commission ’103 and ’960 trademarks. The rights in the designs depicted in the
determined not to review an ID (Order Commission also determined not to ’103 and ’960 trademarks are invalid.
No. 106) finding Zhejiang Ouhai review the remainder of the final ID. The Commission has determined that
International Trade Co. Ltd. and The determinations made in the ALJ’s this finding with respect to these
Wenzhou Cereals Oils & Foodstuffs final ID that were not reviewed became common law rights is moot in view of
Foreign Trade Co. Ltd., both of final determinations of the Commission
the Commission’s finding of a violation
Wenzhou, China, in default. Further, on by operation of rule. See 19 CFR
with respect to the federally-registered
March 25, 2015, the Commission 210.43(h)(2). The Commission also
determined not to review an ID (Order requested the parties to respond to rights in the ’103 and ’960 trademarks
No. 68) granting the motion of Orange certain questions concerning the issues since the scope of the common law and
Clubwear, Inc. of Westminster, under review and requested written federally-registered rights in these
California to terminate the investigation submissions on the issues of remedy, trademarks is co-extensive. See Comm’n
as to itself based on a consent order the public interest, and bonding from Notice (Feb. 3, 2016); ID at 107–08, 121–
stipulation. On May 12, 2015, the the parties and interested non-parties. 26, 128–29, 131–32.
Commission determined not to review 81 FR 6886–89 (Feb. 9, 2016). Having found a violation of section
an ID terminating the investigation as to On February 17 and 24, 2016, 337 as to the ’103 and ’960 federally-
Edamame Kids, Inc. of Alberta, Canada respectively, complainant, respondents, registered trademarks, the Commission
for good cause and without prejudice. and the IA each filed a brief and a reply has made its determination on the
The ALJ issued his final ID on brief on all issues for which the issues of remedy, the public interest,
November 17, 2015, finding a violation Commission requested written
and bonding. The Commission has
of section 337 as to certain accused submissions. Respondents’ reply brief
determined that the appropriate form of
products of each active respondent and included a request for a Commission
as to all accused products of each hearing to present oral argument under relief is a general exclusion order
defaulting respondent. Specifically, the Commission rule 210.45(a). On February prohibiting the unlicensed entry of
ALJ found that the ’753 trademark is not 29 and March 3, 2016, respectively, both footwear products that infringe the ’103
invalid and that certain accused Converse and the IA each filed a or ’960 trademarks.
products of each active respondent, and response to respondents’ request, with The Commission further determined
all accused products of each defaulting each accompanied by a motion for leave that the public interest factors
respondent, infringe the ’753 trademark. to file a sur-reply to the request for oral enumerated in section 337(d)(1) (19
The ALJ also found that: (1) Converse argument. On March 1, 2016, U.S.C. 1337(d)(1)) do not preclude
satisfied both the economic and respondents filed a motion for leave to issuance of the general exclusion order.
technical prongs of the domestic submit a sur-reply to their request for Finally, the Commission determined
industry requirement with respect to all oral argument. The Commission has that a bond of 100 percent of the entered
asserted trademarks; (2) certain accused determined to grant all motions for value (per pair) of the covered products
products of defaulting respondent leave to file sur-replies submitted by the
is required to permit temporary
Foreversun infringe both the ’103 and parties, and to deny respondents’
importation during the period of
’960 trademarks; and (3) a violation of request for a Commission hearing to
section 337 with respect to the ’103 and present oral argument. Presidential review (19 U.S.C. 1337(j)).
’960 trademarks by Foreversun. The ALJ Having reviewed the record in this The Commission has also issued an
also found no dilution of the ’753 investigation, including the ALJ’s final opinion explaining the basis for the
trademark. The ALJ also issued his ID and the parties’ written submissions, Commission’s action. The Commission’s
recommendation on remedy and the Commission has determined to order and opinion were delivered to the
bonding during the period of affirm-in-part, reverse-in-part, and President and to the United States Trade
Presidential review. He recommended a vacate certain portions of the final ID’s Representative on the day of their
general exclusion order directed to findings under review. Specifically, the issuance. The investigation is
footwear products that infringe the Commission has reversed the ALJ’s terminated.
asserted trademarks, and recommended finding that the ’753 trademark is not The authority for the Commission’s
cease and desist orders directed against invalid, and instead has found the determination is contained in section
each active, remaining respondent trademark invalid based on lack of
337 of the Tariff Act of 1930, as
found to infringe. On December 4, 2015, secondary meaning. The Commission
amended, 19 U.S.C. 1337, and in part
complainant, respondents, and the has also affirmed the ALJ’s finding that
there is a likelihood of confusion with 210 of the Commission’s Rules of
Commission investigative attorney
(‘‘IA’’) each filed a timely petition for respect to the ’753 trademark for Practice and Procedure, 19 CFR part
review of the final ID. On December 14, specific accused footwear products if 210.
2015, each of these parties filed the trademark was not invalid. The By order of the Commission.
responses to the other petitions for Commission has also affirmed the ALJ’s Dated: June 23, 2016.
review. finding that there is no likelihood of Lisa R. Barton,
On February 3, 2016, the Commission confusion with respect to the ’753
mstockstill on DSK3G9T082PROD with NOTICES

issued notice of its determination to trademark for specific accused footwear Secretary to the Commission.
review: (1) The ID’s finding of no products regardless of invalidity. [FR Doc. 2016–15339 Filed 6–28–16; 8:45 am]
invalidity of the ’753 trademark; (2) the Further, the Commission has affirmed BILLING CODE 7020–02–P
ID’s findings regarding infringement of the ALJ’s finding that the asserted
the ’753 trademark; (3) the ID’s finding common law rights in the ’753
of invalidity of the common law rights trademark are invalid. Accordingly, the
asserted in the design depicted in the Commission has determined that there

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Document Created: 2018-02-08 07:42:45
Document Modified: 2018-02-08 07:42:45

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
Action		Notice.
Contact		Clint Gerdine, Esq., Office of the General Counsel, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 708-2310. Copies of non- confidential documents filed in connection with this investigation are or will be available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205-2000. General information concerning the Commission may also be obtained by accessing its Internet server at http:// www.usitc.gov. The public record for this investigation may be viewed on the Commission's electronic docket (EDIS) at http://edis.usitc.gov. Hearing-impaired persons are advised that information on this matter can be obtained by contacting the Commission's TDD terminal on (202) 205-1810.
FR Citation		81 FR 42377