Philip Morris Patent Case Shows Difficulty of Questioning ITC

The US Court of Appeals for the Federal Circuit recently affirmed the International Trade Commission’s (ITC) issuance of a limited exclusion order that restricted Philip Morris from importing their heated tobacco devices, which were found to have infringed two patents owned by Reynolds Vapor Company.

Finnegan partner Smith Brittingham told Managing Intellectual Property that the case demonstrates that appealing an ITC decision on the basis that it got the facts wrong is an uphill battle.

“Unless the ITC decision is based on no evidence or a very tortured reading of the facts, it’s quite unlikely that the Federal Circuit will disturb a remedy,” Smith said.

Philip Morris argued that the ITC’s finding that Reynolds had met the domestic industry requirement was erroneous because the electronic cigarette maker’s products had not been approved by the US Food and Drug Administration (FDA) when the complaint was filed.Smith said, “The case demonstrates that the domestic industry analysis doesn’t necessarily focus on whether a product is for sale on the day that a claim is filed. There are other cases in which the investments may be substantial but the product itself may not have been sold yet and those can still qualify as domestic industry investments under appropriate circumstances. The mere fact that the product isn’t for sale won’t likely be a successful argument.”   

He noted that complainants could have a harder time meeting this requirement if a product is yet to be designed.

“But that’s not what’s going on here,” he said. “For this case, it’s not surprising that the commission was willing to say there was domestic industry.”

Regarding the argument that the ITC failed to consult with the FDA, the Federal Circuit concluded that the ITC did satisfy its duty to consult with the FDA by sending out notices to agencies about the investigation. “I don’t think that was a very difficult argument for the Federal Circuit to reject,” he says.

He adds that Philip Morris seemed to rely on the FDA as some sort of hedge against ITC action.

“Practitioners should be hesitant to try to scare the ITC off from acting based on the interests of some other government agency,” he says.

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