ITC Issues Limited Exclusion Order of Diebold ATMs Following Finding of Patent Infringement

| Karen Cassidy Selvaggio

Editors: Joseph Cianfrani and Boris Zelkind

Patent Judgments and Awards

On July 14, 2017, the International Trade Commission determined that financial services company Diebold Nixdorf, Inc. (“Diebold”) violated Section 337 of the Tariff Act by importing ATMs and ATM components that infringe a patent belonging to Nautilus Hyosung America’s (“Hyosung”). The dispute involved automated deposit technology for the processing and depositing mixed bundles of cash and checks. The Commission issued a limited exclusion order banning the importation of Diebold’s infringing ATMs and ATM components. The Commission also issued cease and desist orders barring Diebold from future commercial activities relating to the infringing products, including importing, selling, marketing, advertising, distributing, and transferring. The remedial orders do not affect infringing ATMs currently in use in the United States. In fact, the Commission exempted articles needed for the service and repair of existing infringing ATMs from the remedial orders. The Commission instituted the investigation in March 2016, based on a February 2016 complaint filed by Hyosung alleging infringement of four of its patents. This is not the first ITC dispute between the parties. The Commission handed down the final determination and exclusion order only eight weeks after issuing a limited exclusion order banning the import of certain infringing Hyosung ATM machines in a proceeding initiated by Diebold in October 2015. Although both companies have said that they no longer use the patent-infringing technology in their current products, both companies have also indicated that they will appeal the unfavorable ITC decisions. The parties have also been fighting about these same patents in federal court. The court cases have been on hold pending resolution of the ITC investigations. Both companies have indicated that they will continue to pursue their respective claims in federal court.

The case is In re Certain Automated Teller Machines, et al., USITC Inv. No. 337-TA-989