The Federal Circuit on Monday scrutinized R.J. Reynolds Vapor Co.’s challenge to a $95 million damages award in a dispute over Philip Morris’ vape patents, grilling the company on its claim that the sum lacks evidentiary support.
R.J. Reynolds’ attorney, Jason Burnette of Jones Day, argued before the three-judge panel that Altria Client Services LLC’s damages expert manipulated data from unrelated licensing agreements to inflate the award. According to Burnette, a correct interpretation of those agreements would peg the royalty rate at 0.21%, amounting to $3.67 million, instead of the 5.25% rate that led to the $95 million figure.
But U.S. Circuit Judge Sharon Prost pushed back, suggesting the jury may have been justified in accepting the higher rate due to the evidence presented. “They’ve got 5.25, maybe it’s shaky,” she said, but emphasized that Reynolds failed to offer a robust alternative.
“It’s not Reynolds’ burden to prove the royalty rate,” Burnette countered, maintaining that Altria bore the responsibility to substantiate its claim with substantial evidence.
