Which Laws Apply to Broker-Dealers? Federal Laws? State Laws? Both? General Principles Leading to an Answer

TAMAR FRANKEL

BU Law emerita professor Tamar Frankel explains the law of preemption as it pertains to broker-dealers and their investor clients. She predicts, among other things, that either the clients will demand that broker-dealers adhere to a fiduciary duty, or else that states will impose that duty on them.

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Comcast Corp. v. International Trade Commission

Court: US Court of Appeals for the Federal Circuit

Docket: 18-1450

Opinion Date: March 2, 2020

Judge: Pauline Newman

Areas of Law: Intellectual Property, International Law, International Trade, Patents

The International Trade Commission (ITC) investigated a complaint under Tariff Act Section 337, alleging that Comcast’s customers directly infringe patents by using Comcast’s X1 system. The patents claim an interactive television program guide system for remote access to television programs. An ALJ found a violation, concluding that the X1 set-top boxes are imported by ARRIS and Technicolor and that Comcast is sufficiently involved with the design, manufacture, and importation of the products, such that it is an importer under Section 337. The ITC affirmed, stating that Comcast induced infringement and that Comcast "instructs, directs, or advises its customers on how to carry out direct infringement.” The ITC affirmed that ARRIS and Technicolor do not directly infringe because they do not provide a “remote access device” as required by the claims and do not contributorily infringe because the set-top boxes have substantial non-infringing uses. The ITC issued a limited exclusion order and cease and desist orders directed to Comcast. The Federal Circuit affirmed, rejecting Comcast’s arguments that its conduct is not actionable under Section 337 because Comcast’s inducing conduct “takes place entirely domestically, well after, and unrelated to," the importation and that Comcast does not itself import the articles. The ITC has authority (19 U.S.C. 1337(d)(1)) to issue an exclusion order that blocks the importation of articles manufactured and imported by ARRIS and Technicolor, despite its determination that they did not violate Section 337 and did not infringe the patents.

GS CleanTech Corp. v. Adkins Energy LLC

Court: US Court of Appeals for the Federal Circuit

Docket: 16-2231

Opinion Date: March 2, 2020

Judge: Wallach

Areas of Law: Intellectual Property, Patents

The Patents-in-Suit are directed to the recovery of oil from a dry mill ethanol plant’s byproduct, thin stillage, for example, “evaporating the thin stillage to form a concentrate,” or syrup, and then “separating the oil from the concentrate using a disk stack centrifuge.” In an infringement suit, the district court determined that specified claims were invalid because of the on-sale bar, anticipation, obviousness, incorrect inventorship, inadequate written description, lack of enablement, and indefiniteness. The court concluded that, under the UCC, a signed proposal would have constituted a commercial contract and that a reasonable jury would not have concluded that the proposal was an offer to test its claimed invention as the Inventors knew the method could be successfully reduced to practice and had been reduced to practice. After an inequitable conduct bench trial, the court concluded that the patents were ready for patenting when the Inventors provided the 2003 Proposal and that CleanTech committed inequitable conduct: The "Inventors made a mistake” by offering the invention for sale in 2003, and later affirmatively hid that fact from the lawyers and the Patent Office. The Federal Circuit affirmed. The district court did not abuse its discretion in concluding that CleanTech and its lawyers made a deliberate decision to withhold material information with the specific intent to deceive the Patent Office.