A Wall Street Journal ($$) editorial today warns that an obscure section of the old Smoot-Hawley tariff permits American companies to strike against their competitors by having the government block imports that allegedly infringe their patents. The Journal sees a threat to the mobile networks that depend on imported telephones. Here are some excerpts:

The peril comes from the International Trade Commission (ITC), an obscure federal agency that typically deals with trade but suddenly is telecom central. There are currently cases before the ITC affecting virtually every mobile-phone operator in the country and most of the largest handset makers in the world. Ericsson and Samsung have filed complaints against each other, and Qualcomm has sued Nokia. Broadcom, a chipmaker that owns patents for mobile-phone technology, has filed against Qualcomm, which supplies chips used in new phones sold by Verizon and Sprint.

All of these companies are seeking an edge against their rivals via "exclusion orders," which would ban the import of products said to violate U.S. patent (yes, patent) law. Depending on how the cases are ultimately decided, millions of cell phones could be barred from the U.S. market at a cost to the phone makers and network operators of billions of dollars.

The ITC was established in 1916 as the U.S. Tariff Commission. Smoot-Hawley gave it the authority to review claims of "unfair trade practices" based on patent infringement. If a company with U.S. operations believes a competitor is importing a product that infringes on its intellectual property, it can bring a Section 337 claim to the ITC. An administrative law judge then hears the case, and he can issue an exclusion order barring imports of the infringing product for the duration of the patent. The order is also subject to the review and approval by the six-member, bipartisan ITC board.

Incredibly, all of this takes place separately from normal judicial proceedings on patent infringement or validity. Most of the cell-phone cases mentioned above are also in court on patent-infringement grounds, but these cases can take years and are subject to lengthy appeals. The ITC tries to discharge Section 337 cases in about a year, and will not wait for the courts. Once the ITC votes on the judge's order, there is only one avenue of appeal: The President has 60 days to override the ITC's order. If he doesn't act, the import ban takes effect....

The big picture here is that the ITC has emerged as the patent bar's venue of choice to evade this year's Supreme Court decision in eBay. That ruling raised the bar on permanent injunctions in patent-infringement cases. But the ITC isn't subject to eBay, remarkably enough, so lawyers and patent holders have descended on the agency for a quick protectionist hit.

Oh, what a tangled web we weave....