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tobacco plants

R.J. Reynolds successfully enforces patents in ITC trial against Philip Morris in dispute over cigarette alternative

Client(s) R.J. Reynolds Tobacco Company (RJRT) and R.J. Reynolds Vapor Company (RJRV), collectively ("Reynolds")

Jones Day's client Reynolds achieved a precedent-setting victory before the International Trade Commission (ITC) against its main competitors Philip Morris Products S.A. ("Philip Morris") and Altria Client Services LLC ("Altria") in a patent infringement dispute involving tobacco heating and vaping products. This win for Reynolds marks the first major decision by any court amidst a larger global patent dispute between the Reynolds and Philip Morris affiliated companies.

Reynolds accused Philip Morris/Altria's IQOS® product of infringing U.S. Patent Nos. 9,901,123; 9,930,915; and 9,839,238 – all related to electronic smoking devices. On May 14, 2021, following a six-day evidentiary hearing in January 2021, Administrative Law Judge Clark S. Cheney issued the Initial Determination ("ID"), finding that (1) all of the asserted claims of the '123 and '915 patents are infringed and that Philip Morris and Altria failed to show that any of them are invalid; (2) both the technical and economic prongs of the domestic industry requirement are satisfied for all three asserted patents; (3) the Commission should issue a limited exclusion order blocking the importation of the IQOS® product and related Heatsticks® into the U.S.; and (4) the public interest does not preclude such an exclusion order. On September 29, 2021, in its Final Determination, the full ITC Commission affirmed the Administrative Law Judge’s findings in the Initial Determination and issued a limited exclusion order barring importation of all Philip Morris/Altria’s IQOS® "heat not burn" products into the U.S., as well as cease-and-desist orders. President Biden did not disturb the Commission's findings during the Presidential Review period.

The Federal Circuit affirmed in full the ITC's decision barring importation of an infringing heat-not-burn tobacco product. The court concluded that Philip Morris forfeited its argument that the ITC was required to "consult with" FDA under Section 1337 before issuing its exclusion order by failing to raise, develop, or preserve the issue before its motion to stay the ITC's order. The court also concluded that the ITC satisfied any statutory duty to consult by following its longstanding process for allowing interested agencies to provide written submissions on the public-interest factor and to address the ALJ's final initial determination. Further, the court affirmed the ITC's determination that Reynolds established the existence of a domestic industry even though its products had not yet received FDA marketing authorization at the time the complaint was filed. Finally, the court affirmed the ITC's determinations on public interest, patent validity, and infringement.

The ITC litigation is one of three cases between Reynolds and PMI/Altria currently pending in the U.S. Jones Day also represents Reynolds in the ITC companion case filed in the Eastern District of Virginia, and a patent infringement case filed by Altria in the Middle District of North Carolina related to certain RJRV VUSE® vaping products (Alto® and Vibe) and the VELO nicotine pouch products. Jones Day is also representing Reynolds in several PTAB proceedings relating to the patents-in-suit in the ITC and the district court cases, as well as corresponding litigations pending in Japan and Korea. On September 14, 2023, the Federal Circuit affirmed in full Reynolds’s win in an IPR of one of the patents underlying the ITC win.

Philip Morris Products, S.A. v. U.S.I.T.C., Appeal No. 2022-1227 (Fed. Cir.); Certain Tobacco Heating Articles and Components Thereof, Investigation No. 337-TA-1199 (ITC); RAI Strategic Holdings, et. al. v. Altria, et al., No. 1-20-cv-00393 (E.D. Va.); Altria Client Services, et al. v. R.J. Reynolds Vapor Co., No. 1-20-cv-00472 (M.D.N.C.); Philip Morris Products, S.A. v. RAI Strategic Holdings, Inc., IPR Nos. 2020-00919 - 00921, -01094, -01097, -01188, -01602; PGR No. 2020-00071 (PTAB); R.J. Reynolds Vapor Company and Modoral Brands v. U.S. Smokeless Tobacco Company LLC, IPR Nos. 2021-00477 - 00479 (PTAB); R.J. Reynolds Vapor Company et al. v. Philip Morris Products S.A., IPR Nos. 2021-00585 - 00586 (PTAB); R.J. Reynolds Vapor Company et al. v. Altria Client Services LLC, IPR Nos. 2021-00650, -00652, -00744 - 00747, -00793 (PTAB); R.J. Reynolds Vapor Company et al. v. Philip Morris USA, Inc., IPR No. 2021-00725; Philip Morris Products S.A. v. BAT Japan, Tokyo District Court, Case No. H30 (wa) 20178; RAI Strategic Holdings, Inc. and Nicoventures Trading Ltd. v. Philip Morris Japan, Ltd. and Sojitz Corp., Tokyo District Court, Case No. R2 (wa) 25892; R.J. Reynolds Tobacco Co. and Nicoventures Trading Ltd. v. Philip Morris Japan, Ltd. and Sojitz Corp., Tokyo District Court, Case No. H30 (wa) 25891; RAI Strategic Holdings, Inc. and British American Tobacco Korea Manufacturing Ltd. v. Philip Morris Korea, Inc., Seoul District Court, Case No. 2021Gahap515161