ITC Trends Reshaping Section 337 Litigation Strategy in 2026

Activity at the US International Trade Commission (ITC) has increased in 2026, while several legal and procedural developments are changing how patent owners and respondents approach the forum. As of August 2026, the ITC instituted just under 50 new complaints and ancillary proceedings under Section 337, putting activity on pace to meet or exceed recent-year levels.

Developments involving the domestic industry requirement, standard-essential patents (SEPs), litigation funding and ownership disclosures, and parallel Patent Trial and Appeal Board (PTAB) proceedings are affecting the risks and strategic opportunities associated with ITC investigations.

Four trends in particular warrant attention as companies evaluate potential Section 337 claims, prepare to respond to investigations, and coordinate ITC proceedings with broader patent enforcement and licensing strategies.

Domestic Industry Doorway Is Wider, but Analysis Remains Fact Intensive

The US Court of Appeals for the Federal Circuit's March 2025 decision in Lashify Inc. v. ITC widened the doorway for complainants seeking to establish a domestic industry under Section 337, but subsequent ITC decisions illustrate that the inquiry remains highly fact intensive.

Historically, the ITC excluded certain activities and expenses from the domestic industry analysis when undertaken on their own, such as costs associated with selling, advertising, and distributing products in the United States. In Lashify, the Federal Circuit rejected that longstanding interpretation of Section 337, concluding that the statutory language does not limit the types of domestic activities that may be considered in establishing a domestic industry.

The decision potentially opens the ITC to complainants that rely less heavily on US manufacturing and research and development activities and more on other domestic activities relating to the sale and/or distribution of products. It also shifts the focus of domestic industry disputes toward whether the asserted domestic investments are sufficiently significant.

That significance analysis has emerged as an important battleground. In a December 2025 Commission opinion involving products for which engineering, research, and development occurred in the United States but manufacturing occurred abroad, the commissioners articulated different methodologies for evaluating significance. The approaches varied on whether and how domestic investments should be compared with foreign activities; the relevance of foreign manufacturing to the significance analysis; and the weight given to qualitative domestic activities, such as research and development.

Separate Commission decisions involving patented components incorporated into downstream products also underscore the importance of nexus.

In an April 2025 Commission Opinion involving the framework for downstream products, the Commission reinforced the importance of the analysis set forth in Certain Magnetic Tape Cartridges to determine whether the realities of the marketplace support finding that investments other than in the patented technology or articles may be considered qualifying investments. The relevant considerations include the following:

• Whether the patented technology is sold separately
• Whether the patented technology is essential to the downstream product
• Whether the asserted domestic activities have a direct relationship to exploitation of the patented technology

Customization or incorporation into a downstream product without more may not establish the necessary connection.

For potential complainants, Lashify creates additional flexibility but does not eliminate the need for a carefully developed domestic industry record. For respondents, significance and nexus may become increasingly important areas for testing whether asserted US investments satisfy Section 337.

SEP Investigations Remain a Source of Settlement Leverage

Even without a recent SEP-based exclusion order, the speed and remedy risk associated with the ITC can reshape global fair, reasonable, and nondiscriminatory (FRAND) and portfolio licensing negotiations.

Although the ITC has not issued an SEP-based exclusion order since 2013, that does not necessarily mean the forum has become ineffective for SEP owners. Six SEP-related ITC investigations concluded during 2025. Five of these settled, while the sixth concluded without a violation finding, but contributed to the resolution of a broader global SEP dispute.

The ITC's compressed schedule, broad discovery reach, and potential exclusion remedy distinguish the forum from many other venues in which SEP disputes may proceed. Those features can put pressure on global licensing negotiations before the Commission ever reaches the remedy stage.

For patent owners, an ITC investigation therefore may function as a settlement catalyst even where obtaining an exclusion order is uncertain. Respondents, meanwhile, may need to coordinate an integrated strategy addressing infringement, validity, essentiality, exhaustion, licensing history, FRAND conduct, and the public interest rather than treating the ITC investigation as an isolated US patent dispute.

As such, the practical significance of SEP investigations should not be measured solely by the number of exclusion orders issued. Their effect on the timing and leverage of broader licensing negotiations may be equally important.

Funding and Ownership Transparency Could Become Part of the Case Record

In April 2026, the ITC proposed rules that would require parties and intervenors to disclose certain entities possessing ownership, control, or financial interests in an investigation. If adopted, the requirements could bring litigation funding and other financial relationships further into Section 337 proceedings.

The implications could extend beyond disclosure itself. Non-practicing entities and externally financed operating companies may face additional transparency regarding their funding and control structures. Depending on the circumstances, disclosures could raise questions concerning conflicts, standing, litigation control, and settlement authority.

For respondents, the information could provide additional avenues to examine real parties in interest and who exercises control over an investigation. It could also lead to disputes concerning privilege and work product protection for communications with funders or investors. Financial-interest information may even become relevant to issues such as witness bias, credibility, conflicts, and settlement dynamics.

Because the requirements remain proposed, their ultimate scope and practical effects remain to be seen. Regardless, parties considering ITC litigation should monitor the rulemaking and assess whether existing funding, ownership, and control arrangements could become subject to greater scrutiny.

PTAB Sequencing Is Becoming More Consequential

The interaction between the ITC and PTAB has also become an increasingly important part of litigation strategy. The ITC's timetable can affect whether the PTAB reaches the merits of a parallel challenge, increasing the importance of forum sequencing and coordination of validity positions.

Under US Patent and Trademark Office guidance issued in March 2025, the PTAB may consider the ITC’s projected final-determination date when deciding whether to institute an inter partes review (IPR). As a result, an accelerated ITC proceeding may reduce the practical value of an IPR if the ITC is positioned to address validity before the PTAB.

For complainants, a fast ITC target date may therefore make a respondent's parallel IPR strategy less consequential. For respondents, IPRs remain an important potential tool, but timing risk has increased when the ITC is likely to decide first.

This dynamic places greater importance on decisions made early in the dispute. Respondents should consider the below:

• The timing of IPR petitions, particularly when the ITC may reach a determination first
• Stipulations intended to reduce duplicative validity proceedings, which may affect the PTAB’s institution decision
• Narrowing claims or prior art in ways that may affect the PTAB institution posture
• Fully developing invalidity defenses at the ITC rather than assuming PTAB review will be available or reach a decision in time to affect the investigation

Looking Ahead with New Commissioners

These four trends reflect how Section 337 strategy is extending beyond the traditional questions of infringement and remedy. Domestic industry disputes are increasingly focused on significance and nexus, SEP investigations can influence broader licensing negotiations even without an exclusion order, funding and ownership structures may become more visible, and ITC timing can affect the availability and value of parallel PTAB review.

Going forward, companies should watch how the Commission approaches domestic industry questions, whether proposed financial-interest disclosure requirements advance, and how developments involving SEP disputes and PTAB proceedings continue to interact with ITC investigations, as these developments could further shape how patent owners and respondents assess and prepare for Section 337 litigation.

It will be especially important to follow such developments in light of the substantial changes in the composition of the Commission in 2026. In the last several months, five new commissioners were appointed by the president and confirmed by the Senate, with only Commissioner Jason Kearns continuing in his position. This marks the first time in approximately a decade that none of the ITC’s six seats are vacant. With new appointee Brett Doyle designated as chair of the Commission for the next two years, the newly constituted ITC is deserving of attention.