Trade Secrets

TianRui v. ITC: How Section 337 Reached a Theft That Happened in China

The Federal Circuit held that the International Trade Commission may bar imports based on trade-secret misappropriation occurring entirely in China, opening the ITC as a forum for cross-border theft.

March 17, 2025
Cast steel railway wheels stacked at an industrial freight yard
TianRui established that the ITC can police trade-secret theft that occurs abroad so long as the tainted goods are imported into the United States. Shutterstock
Educational content, not legal advice. This article explains general legal concepts. It does not create an attorney–client relationship. For your specific situation, consult a licensed attorney.

The caption reads TianRui Group Co. v. International Trade Commission, No. 2010-1395, decided by the United States Court of Appeals for the Federal Circuit on October 11, 2011, on appeal from the U.S. International Trade Commission in Certain Cast Steel Railway Wheels, Inv. No. 337-TA-655. In a 2-1 decision authored by Judge William C. Bryson, with Judge Kimberly A. Moore dissenting, the court answered a question the ITC had never squarely faced: may the Commission bar the importation of goods because of trade-secret misappropriation that took place entirely on foreign soil? The majority said yes. The dissent called the potential breadth of that holding “staggering.” More than a decade later, TianRui remains the foundational authority for using the ITC as a venue against international trade-secret theft.

At a glance

  • Case: TianRui Group Co. v. International Trade Commission, No. 2010-1395
  • Court: U.S. Court of Appeals for the Federal Circuit
  • Decided: October 11, 2011
  • Underlying proceeding: Certain Cast Steel Railway Wheels, Processes for Manufacturing or Relating to Same, and Certain Products Containing Same, ITC Inv. No. 337-TA-655
  • Parties: Complainant Amsted Industries Inc.; respondents TianRui Group Company Ltd., TianRui Group Foundry Company Ltd., Standard Car Truck Company, and Barber TianRui Railway Supply LLC
  • Panel: Bryson, J. (majority, joined by Reyna, J.); Moore, J. (dissenting)
  • Holding: Section 337 of the Tariff Act of 1930 permits the ITC to bar imports based on trade-secret misappropriation that occurred abroad, and a single federal standard—not state law—governs what constitutes misappropriation for that purpose
  • Significance: The first appellate decision authorizing the ITC to reach wholly extraterritorial trade-secret theft, provided the resulting goods are imported and a domestic industry is injured

The conduct that happened entirely in China

Amsted Industries developed two secret processes for casting steel railway wheels. It used one, the “ABC process,” at its domestic foundries; it had licensed the other to manufacturers in China. TianRui, a Chinese firm, sought a license to the ABC process and was rebuffed. Rather than walk away, TianRui hired away employees from Datong ABC Castings Company, one of Amsted’s Chinese licensees. Nine former Datong workers—each bound by confidentiality obligations—joined TianRui and disclosed the ABC process. TianRui used that misappropriated know-how to manufacture cast steel railway wheels, which it then marketed in the United States through a joint venture with Standard Car Truck, Barber TianRui Railway Supply.

Every operative act of misappropriation—the recruitment, the disclosure of confidential information, the use of the secret process to make wheels—occurred in China. The only domestic touchpoint was the endpoint: importation of the finished wheels into the U.S. market. That geographic asymmetry framed the entire appeal. TianRui argued that Section 337 cannot reach conduct that takes place beyond U.S. borders, and that applying it to acts in China offended the longstanding presumption against the extraterritorial application of American statutes.

A single federal standard for misappropriation

Before reaching extraterritoriality, the Federal Circuit had to decide which body of law defined “misappropriation” for Section 337 purposes. The Commission had drawn on Illinois trade-secret law; TianRui contended Chinese law should govern conduct in China. The majority rejected both, holding that a uniform federal standard controls. Section 337 prohibits “unfair methods of competition and unfair acts in the importation of articles,” 19 U.S.C. § 1337(a)(1)(A), and the court reasoned that the meaning of that federal trade statute should not vary with the law of whatever state or nation the underlying conduct happened to touch. Drawing on the Restatement of Unfair Competition and the widely adopted Uniform Trade Secrets Act, the court articulated a generally accepted definition of misappropriation and applied it directly.

This choice mattered. By federalizing the substantive standard, the court detached the Section 337 inquiry from the accident of where the theft occurred. It no longer mattered whether Chinese law would or would not have recognized the conduct as actionable; the question was whether the conduct met the federal definition of misappropriation and produced an unfair act in importation.

Why the presumption against extraterritoriality did not bar relief

The heart of the opinion addressed the presumption against extraterritoriality—the default rule that Congress legislates with domestic concerns in mind. The majority offered three reasons the presumption did not defeat the Commission’s authority.

First, the court characterized the statute’s focus as domestic. Section 337 does not regulate foreign conduct as such; it regulates importation into the United States and the injury that tainted imports inflict on a domestic industry. The misappropriation abroad was, in the court’s framing, simply one element of an unfair act whose consummating event—importation—was unambiguously domestic. Because the statute targets the importation of goods produced through unfair means, applying it required no impermissible projection of U.S. law onto purely foreign commerce.

Second, the court emphasized the statutory injury requirement. Section 337 relief is available only where the unfair acts threaten to “destroy or substantially injure an industry in the United States.” Amsted’s domestic wheel-manufacturing industry supplied that nexus. The remedy thus turned on harm felt within the United States, not on a freestanding condemnation of foreign business practices.

Third, the court noted that the remedy itself operates only at the border. A Section 337 exclusion order does not enjoin TianRui’s conduct in China or reach its sales elsewhere in the world; it bars the entry of offending articles into the United States. The Commission was not policing China—it was controlling what crosses the U.S. customs line.

Judge Moore disagreed, and pointedly. In her view, the majority expanded both Section 337 and trade-secret law to punish conduct occurring entirely in China, with consequences whose breadth she found difficult to cabin. Her dissent has become the standard articulation of the concern that TianRui lets the ITC sit in judgment of foreign business conduct under the banner of import regulation.

Open questions

TianRui answered the threshold question of authority but left the contours of that authority unsettled. The opinion did not define how attenuated the domestic link may become before the importation nexus dissolves—what happens, for instance, when the misappropriator imports only a trickle of goods, or when the connection between the foreign theft and the imported article is indirect. It did not resolve how the Commission should treat parallel foreign proceedings adjudicating the same theft, an issue that would surface squarely in later cases. Nor did it address how a federalized misappropriation standard interacts with genuine conflicts between U.S. and foreign trade-secret regimes, or how the Commission should weigh comity when a respondent’s home jurisdiction has reached a contrary conclusion. The decision settled that the door is open; it left for future investigations the question of how wide.

Implications

  • The ITC is a viable forum for foreign theft. Where a competitor steals trade secrets abroad and imports the resulting goods, Section 337 offers a path to an exclusion order even when every act of misappropriation occurred overseas.
  • Importation plus domestic injury is the nexus. Complainants must anchor the claim in goods entering the United States and harm to a domestic industry; the foreign theft is actionable because it taints those imports.
  • A federal standard governs. Misappropriation is judged by a uniform federal definition drawn from the Restatement and the Uniform Trade Secrets Act, not by the law of the place where the theft occurred.
  • The remedy is a border measure, not a global injunction. An exclusion order stops offending articles at the U.S. line; it does not reach the respondent’s conduct or sales abroad, which both narrows the relief and helps it survive extraterritoriality objections.
  • Speed and leverage. ITC investigations move on a statutory schedule and can yield exclusion orders that a foreign defendant may find harder to evade than a district-court judgment requiring overseas enforcement.

Frequently asked questions

Did TianRui hold that U.S. trade-secret law applies in China? No. The court held that a federal standard defines misappropriation for purposes of Section 337, and that the Commission may consider conduct occurring abroad in deciding whether an unfair act in importation occurred. The remedy reaches only goods imported into the United States; it does not regulate the respondent’s conduct within China.

Why didn’t the presumption against extraterritoriality bar the claim? The majority concluded that Section 337’s focus is domestic—it targets importation into the United States and injury to a domestic industry. Because the statute regulates the import transaction and its domestic effects, applying it to bar tainted imports did not amount to an impermissible extraterritorial application, even though the underlying theft happened in China.

What relief did Amsted obtain? The Commission found a Section 337 violation and issued a limited exclusion order barring importation of unlicensed cast steel railway wheels manufactured using Amsted’s misappropriated ABC process. The Federal Circuit affirmed the Commission’s determination.

Authorities and sources