ITC bows out of Align complaint against ClearCorrect, battle to play out in court

The U.S. International Trade Commission last week declined to fight for its authority to regulate data, leaving the battle between Align Technology‘s (NSDQ:ALGN) and ClearCorrect to play out in patent infringement litigation.

Both Align and the ITC had until August 26 to appeal a ruling made in November which found that the ITC does not have jurisdiction over the transmission of digital data over the internet.

The decision is the latest in an ongoing dispute between the companies over patents related to clear orthodontic liners.

ClearCorrect called the lack of appeal a victory, saying that the “Federal Circuit cleared ClearCorrect, LLC of any liability in the International Trade Commission’s investigation relating to Align Technology’s claims of patent infringement.”

Align has not yet commented on the decision.

In March, the U.S. Court of Appeals for the Federal Circuit denied a plea for an en banc rehearing of the case against ClearCorrect

While ClearCorrect celebrated the ruling as a victory supporting the compliance of its clear aligner product with legal standards, Align Technologies said the decision was solely about the International Trade Commission’s jurisdiction on digitally transmitted data.

“This is not a decision against Align and it is not a decision about the substance or compelling evidence of ClearCorrect’s patent infringement – this decision remains solely about the ITC’s jurisdiction. The panel’s decision today has no bearing on Align’s patents or position against ClearCorrect. As Judge Newman’s dissenting opinion today noted, ‘it is not disputed that the digital data sets and digital models for teeth alignment, produced in Pakistan and imported into the United States, infringe the patents of Align Technology’,” Align Technology veep and GC Roger George said in prepared remarks.

Last December, ClearCorrect said it filed an Inter Partes Review with the United States Patent and Trademark Office. The IPR must be decided within 12 months, ClearCorrect said, and stands independent from the company’s other ongoing USPTO patent challenges.

The IPR was requested for only 1 of the 14 patents asserted in Align’s federal district court action against SmileCareClub LLC in California, Align Technology said, and is not among the patents the International Trade commission ruled on in Align’s favor in May, 2013.

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