A U.S. trade judge on Tuesday granted wearable fitness company Fitbit Inc's motion to drop its patent infringement complaint against rival Jawbone, ending one part of the ongoing intellectual property dispute between the two companies. The order, from Administrative Law Judge Thomas Pender of the International Trade Commission ("ITC"), comes days after Jawbone accused Fitbit of making baseless claims that Jawbone was failing financially in its motion to drop its complaint, which had sought to bar Jawbone from importing wearable fitness products that Fitbit said infringed its patents.
Attorneys and spokespeople for the companies could not immediately be reached for comment.
San Francisco-based Fitbit moved to withdraw its complaint on December 23, saying it believed Jawbone was no longer able to sell products and had either gone bankrupt or fallen into default as of early October. Though it did not oppose Fitbit's motion, Jawbone, also based in San Francisco, shot back in a filing with the ITC on December 28, that it had not declared bankruptcy, and that Fitbit's motion was "a public attempt at misdirection."
Fitbit's motion had cited a September Business Insider report that Jawbone had failed to pay a key business partner and had almost no inventory left, and an October report from Fortune magazine that it was clashing with a large investor. Jawbone said those reports had "little to no relevance on the decision to terminate now." Chandler Wills, a spokesman for Fitbit, said in an email last Friday that Jawbone's filing was "misleading as to the facts of the case and the facts supporting the motion to terminate."
The ITC dispute began in July 2015 with a complaint by Jawbone accusing Fitbit of infringing six of its patents, as well as poaching employees who took with them confidential information. Fitbit responded with its now-withdrawn complaint, accusing Jawbone of infringing three of its patents, in November 2015.
Jawbone withdrew two of its patents from its complaint, and an ITC administrative law judge found the other four invalid in April. In June, the commission declined to review that determination, leaving only Jawbone's trade secrets claims remaining. In August, an ALJ ruled against Jawbone on those claims, and the commission upheld that ruling in October.
In July, an ALJ found all three of the patents asserted by Fitbit invalid, but the commission vacated that decision in September and remanded with instructions to reconsider two of the patents.
Fitbit is the biggest maker of wrist-based and clippable fitness devices, which track users' steps, calories burned, heart rates and other parameters. It sold 5.7 million devices in the second quarter of this year, beating revenue estimates.
Jawbone makes a range of activity trackers under the UP brand but has been losing market share. It is no longer among the top five wearables vendors, according to market research firm International Data Corp. The companies are still litigating multiple patent cases in San Francisco federal court, and a trade secrets case brought by Jawbone against Fitbit in California state court.
* The case is In the Matter of Certain Activity Tracking Devices, Systems and Components, at the U.S. International Trade Commission, No. 337-963.