FOLLOW US

The U.S. Court of Appeals for the Federal Circuit has refused to reconsider a $95 million judgment against R.J. Reynolds Vapor Co., upholding a landmark decision that found the company’s Vuse Alto e-cigarettes infringed on patents owned by Altria Client Services LLC.

In a succinct order issued Monday, the Federal Circuit judges denied R.J. Reynolds’ petition for both a panel and an en banc review, leaving the massive damages award intact. The ruling effectively cements Altria’s victory in a fierce legal battle over proprietary e-cigarette technology.

Altria Secures Major Win in Patent War

Altria, the parent company of Philip Morris, originally won the case in 2022 when a North Carolina federal jury ruled that R.J. Reynolds’ Vuse Alto devices unlawfully incorporated three patented technologies. Altria, despite not selling its own e-cigarette under these patents, argued that its innovations enhanced existing vaping products, solving issues like leakage and inefficiency.

Though R.J. Reynolds sought to slash the $95 million penalty—contending that damages should not exceed $3.6 million—the appellate court upheld the original judgment, dealing a devastating blow to the tobacco giant’s defense.

Judges Split on the Damages Award

While the majority panel found ample evidence supporting both Altria’s claims and the hefty damages sum, Circuit Judge William Bryson dissented. In his view, the jury had been overly generous, and the royalty rate should have been halved from 5.25%, calling for a new damages trial unless Altria voluntarily cut the award in half—a proposal that never materialized.

R.J. Reynolds’ petition for reconsideration argued that the appellate panel ignored critical facts, particularly regarding the role of non-patented features in the Vuse Alto’s success. The company insisted that under Supreme Court precedent, Altria should have provided clearer evidence separating patented contributions from unpatented ones when calculating damages.

Legal Battle Far From Over?

With the Federal Circuit declining to intervene, R.J. Reynolds’ legal options are narrowing, but a Supreme Court appeal could still be on the table. Industry experts say the case sets a powerful precedent in the rapidly evolving e-cigarette market, where patent disputes are becoming increasingly high-stakes.

Legal teams for both sides have remained tight-lipped, declining to provide immediate comments on the ruling.

Attorneys on Record

• Altria is represented by:

  • Weil Gotshal & Manges LLP – Mark A. Perry, Daniel M. Lifton, Robert Niles-Weed
  • Paul Weiss Rifkind Wharton & Garrison LLP – Elizabeth Stotland Weiswasser, Anish Desai, Sutton Ansley, Priyata Patel

• R.J. Reynolds is represented by:

  • Jones Day – Jason T. Burnette, Laura Kanouse Vining, Alexis Adian Smith, John A. Marlott, Amelia A. DeGory
  • Womble Bond Dickinson – John Morrow

The case remains Altria Client Services LLC v. R.J. Reynolds Vapor Co., case number 23-1546, in the U.S. Court of Appeals for the Federal Circuit.