U.S. Court of Appeals for the Federal Circuit, Philip Morris v. ITC, Docket No. 2022-1227

Customs

 

Import

 

Section 337 of the Tariff Act of 1930, 19 U.S.C. § 1337

 

Duty to Consult Under Section 337

 

Forfeiture

 

Public Interest

 

Domestic Industry Requirement

 

Patent Infringement

 

Cease and Desist Order

 

Limited Exclusion Order

 

 

 

 

Appeal from the United States International Trade Commission in Investigation No. 337-TA-1199.

 

 

RAI Strategic Holdings, Inc., R.J. Reynolds Vapor Company, and R.J. Reynolds Tobacco Company (collectively “Reynolds”) filed a complaint at the International Trade Commission alleging that respondents Philip Morris Products S.A., Philip Morris USA, Inc., and Altria Client Services LLC (collectively “Philip Morris”) violated Section 337 of the Tariff Act of 1930, 19 U.S.C. § 1337, through the importation and sale of tobacco products that infringed certain claims of U.S. Patent Nos. 9,901,123 and 9,930,915. After conducting a Section 337 investigation, the Commission barred Philip Morris and its affiliates from importing products infringing the asserted patents. Philip Morris appeals, contending that the Commission failed to “consult with, and seek advice and information from” the Department of Health and Human Services (HHS) as required by Section 337. In addition, Philip Morris challenges the Commission’s determinations on public interest, domestic industry, patent validity, and infringement. For the reasons set forth below, we affirm the Commission’s decision in full.

 

 

(…) In response to Reynolds’ complaint, the Commission instituted an investigation and ordered the presiding administrative law judge (ALJ) to “provide the Commission with findings of fact and a recommended determination on the issue” of public interest. J.A. 3432–33 (85 Fed. Reg. 29,482–83 (May 15, 2020)).

 

 

The ALJ issued a final initial determination (FID) concluding that: (1) Reynolds had shown that Philip Morris infringed the asserted claims, and that Philip Morris had not shown the asserted claims to be invalid, id. at *58; (2) Reynolds had established the existence of a domestic industry with respect to both of the asserted patents, id.; and (3) “the public interest evidence of record did not weigh against entry of a remedy,” id. at *73. The ALJ also recommended that the Commission issue a limited exclusion order, id. at *74, but not cease and desist orders, id. at *76. Philip Morris petitioned the full Commission for review of the FID.

 

 

It is undisputed that Reynolds satisfied the technical prong of the domestic industry requirement with respect to the asserted patents. (Fn. 1).

 

 

The Commission decided to review the FID in part. In the Matter of Certain Tobacco Heating Articles & Components Thereof, Inv. No. 337-TA-1199, Commission Opinion, 2021 WL 4947427 (Oct. 19, 2021) (Commission Op.). Among other things, it affirmed the ALJ’s determination of nonobviousness of the asserted claims of the ’123 patent and the ALJ’s determination that Reynolds satisfied the domestic industry requirement. The Commission concluded that Philip Morris had violated Section 337 and issued cease and desist orders directed to Altria Client Services LLC and Philip Morris USA, Inc., and issued a limited exclusion order banning the importation of infringing products by Philip Morris and its affiliates. Philip Morris appeals. We have jurisdiction under 28 U.S.C. § 1295(a)(6).

 

 

Our court reviews the Commission’s decisions under the standards of the Administrative Procedure Act (APA). 19 U.S.C. § 1337(c); 5 U.S.C. § 706(2). We review the Commission’s legal determinations, including statutory interpretation, de novo and its factual findings for substantial evidence. Spansion, Inc. v. Int’l Trade Comm’n, 629 F.3d 1331, 1343–44 (Fed. Cir. 2010).

 

 

We begin with Philip Morris’s argument that the Commission erred by failing to meet its statutory duty as set forth in Section 337. That statutory duty requires that: During the course of each investigation under this section, the Commission shall consult with, and seek advice and information from, the Department of Health and Human Services, the Department of Justice, the Federal Trade Commission, and such other departments and agencies as it considers appropriate. 19 U.S.C. § 1337(b)(2).

 

 

Because Philip Morris forfeited this argument, and because in any event the Commission satisfied its duty to “consult with” HHS, we conclude that the Commission committed no error.

 

 

(…) Even in the absence of forfeiture, we conclude that, in this case, the Commission satisfied its duty to “consult with” HHS and the FDA. When the Commission instituted the investigation in May 2020, it published a Notice of Investigation in the Federal Register, J.A. 3432–33, and individually served letters enclosing the Notice of Investigation to representatives of the Department of Justice, the U.S. Bureau of Customs and Border Protection, the Federal Trade Commission, and HHS. J.A. 43501.

 

 

Public Interest:

 

§ 1337(d)(1) provides that if the Commission determines “that there is violation of this section, it shall direct that the articles concerned. . . be excluded. . . unless, after considering public interest, it finds that such articles should not be excluded” (emphasis added). In deciding this issue, the Commission must consider the effect of the remedy on four statutory public interest factors: (1) public health and welfare, (2) competitive conditions in the U.S. economy, (3) the production of like articles in the United States, and (4) U.S. consumers. 19 U.S.C. § 1337(d)(1), (f)(1).

 

 

 

Domestic industry requirement:

 

The domestic industry requirement of Section 337, 19 U.S.C. § 1337(a)(2) and (a)(3), includes an economic prong, which “requires that there be an industry in the United States,” and a technical prong, which “requires that the industry relate to articles protected by the patent,” both of which must be met. InterDigital Commc’ns, LLC v. Int’l Trade Comm’n, 707 F.3d 1295, 1298 (Fed. Cir. 2013).

 

 

(…) Obviousness of the ’123 Patent Claims (…).

 

 

(…) Infringement of the ’915 Patent.

 

 

 

 

(U.S. Court of Appeals for the Federal Circuit, March 31, 2023, Philip Morris v. ITC, Docket No. 2022-1227)

 

Pooshs v. Philip Morris, S172023

Smoking: statute of limitations: plaintiff was a cigarette smoker for 35 years, from 1953 through 1987.  In 1989, she was diagnosed with chronic obstructive pulmonary disease (COPD), which plaintiff knew was caused by her smoking habit.  Nevertheless, she did not sue the manufacturers of the cigarettes that she had smoked, and the statutory period for doing so elapsed. In 1990 or 1991, plaintiff was diagnosed with periodontal disease, which she knew was caused by her smoking habit.  Again, she did not sue the various cigarette manufacturers, and the statutory period for doing so elapsed. In 2003, plaintiff was diagnosed with lung cancer.  This time, she sued.  We must decide whether the lawsuit is barred by the statute of limitations, which requires that a suit be brought within a specified period of time after the cause of action accrues. The matter comes to us from the United States Court of Appeals for the Ninth Circuit.  (See Cal. Rules of Court, rule 8.548.)  The Ninth Circuit has asked us to answer two questions:  “(1) Under California law, when may two separate physical injuries arising out of the same wrongdoing be conceived of as invading two different primary rights?  (2) Under California law, may two separate physical injuries — both caused by a plaintiff’s use of tobacco — be considered ‘qualitatively different’ for the purposes of determining when the applicable statute of limitations begins to run?”  (Pooshs v. Phillip Morris USA, Inc. (9th Cir. 2009) 561 F.3d 964, 966-967 (Pooshs).)  In granting the Ninth Circuit’s request, we restated the two questions in a single question:  “When multiple distinct personal injuries allegedly arise from smoking tobacco, does the earliest injury trigger the statute of limitations for all claims, including those based on the later injury?” We hold that two physical injuries — both caused by the same tobacco use over the same period of time — can, in some circumstances, be considered “qualitatively different” for purposes of determining when the applicable statute of limitations period begins to run.  (Grisham v. Philip Morris U.S.A., Inc. (2007) 40 Cal.4th 623, 645 (Grisham).)  Specifically, when a later-discovered disease is separate and distinct from an earlier-discovered disease, the earlier disease does not trigger the statute of limitations for a lawsuit based on the later disease.  This holding is consistent with the conclusions reached by courts in other jurisdictions addressing the same issue, often in the context of asbestos-related litigation.  (The leading case is Wilson v. Johns-Manville Sales Corp. (D.C. Cir. 1982) 684 F.2d 111, 112 (Wilson), in which a federal Court of Appeals concluded “that time to commence litigation does not begin to run on a separate and distinct disease until that disease becomes manifest.”  Cases from jurisdictions throughout the United States have followed Wilson.  (See, e.g., Nicolo v. Philip Morris, Inc (1st Cir. 2000) 201 F.3d 29; Jackson v. Johns-Manville Sales Corp. (5th Cir. 1984) 727 F.2d 506; Goodman v. Mead Johnson & Co. (3d Cir. 1976) 534 F.2d 566; Agles v. Merck & Co., Inc. (D.Hawaii 1995) 875 F.Supp. 701; Anderson v. W.R. Grace & Co. (D.Mass. 1986) 628 F.Supp. 1219; Fearson v. Johns-Manville Sales Corp. (D.D.C. 1981) 525 F.Supp. 671; Sheppard v. A.C. & S. Co. (Del.Super.Ct. 1985) 498 A.2d 1126, affd. in Keene Corp. v. Sheppard (Del. 1986) 503 A.2d 192; VaSalle v. Celotex Corp. (Ill.App.Ct. 1987) 515 N.E.2d 684; Pierce v. Johns-Manville Sales Corp. (Md. 1983) 464 A.2d 1020; Board of Trustees v. Mitchell (Md.Ct.Spec.App. 2002) 800 A.2d 803; Larson v. Johns-Manville Sales Corp. (Mich. 1986) 399 N.W.2d 1; Sweeney v. General Printing Inc. (N.Y.App.Div. 1994) 621 N.Y.S.2d 132; Marinari v. Asbestos Corp., Ltd. (Pa.Super.Ct. 1992) 612 A.2d 1021; Shadle v. Pearce (Pa.Super.Ct. 1981) 430 A.2d 683; Potts v. Celotex Corp. (Tenn. 1990) 796 S.W.2d 678; Pustejovsky v. Rapid-American Corp. (Tex. 2000) 35 S.W.3d 643; Niven v. E.J. Bartells Co. (Wn.Ct.App. 1999) 983 P.2d 1193; see also cases cited in Grisham, supra, 40 Cal.4th at p. 643, fn. 12.)We limit our holding to latent disease cases, without deciding whether the same rule should apply in other contexts. In addressing the issue presented here, we emphasize that our role is only to answer the “question of California law” that the Ninth Circuit posed to us.  (Cal. Rules of Court, rule 8.548(a).)  We play no role in assessing the merits of plaintiff’s factual assertions, which must be determined in the federal court.  Specifically, plaintiff asserted in the federal district court that her lung cancer is a disease that is separate and distinct from her other two smoking-related diseases.  Although this assertion appears plausible on its face, its resolution requires medical expertise.  Here, the factual record was never developed because the federal court considered plaintiff’s separate-disease assertion to be irrelevant for purposes of applying the statute of limitations, and it granted summary judgment for defendants.  On plaintiff’s appeal to the Ninth Circuit, that court then asked us whether plaintiff’s assertion that her diseases are separate and distinct has any relevance under California statute of limitations law.  The Ninth Circuit’s reference order states:  “For the purposes of summary judgment . . . it is uncontested that the etiology for lung cancer is distinct from the etiology for COPD and periodontal disease.”  (Pooshs, supra, 561 F.3d at p. 967.)  Therefore, in addressing the issue before us, we assume plaintiff’s assertion to be true, and we focus solely on its legal implications. In response to the Ninth Circuit’s inquiry, we conclude that when a later-discovered latent disease is separate and distinct from an earlier-discovered disease, the earlier disease does not trigger the statute of limitations for a lawsuit based on the later disease (Cal. S. Ct., S172023, Pooshs v. Philip Morris, 05.05.2011).

Tabac : prescription : la demanderesse a été fumeuse de cigarettes pendant 35 ans, de 1953 à 1987. En 1989, elle reçut le diagnostic de maladie obstructive pulmonaire chronique. La demanderesse savait que sa maladie était causée par son tabagisme. Nonobstant, elle n’actionna pas en justice le fabricant des cigarettes qu’elle fumait, et son droit d’action se périma. En 1990 ou 1991, le corps médical diagnostiqua une maladie périodontale chez la demanderesse. Elle savait cette maladie causée par son habitude de fumer. A nouveau, elle ne déposa aucune action en justice à l’encontre des différents fabricants de cigarettes, et sont droit s’est périmé. En 2003, c’est le diagnostic de cancer des poumons qui fut posé. Cette fois-ci, elle ouvrit action en justice. Dans cette affaire, la Cour Suprême de Californie doit décider si l’action en justice est ou non tardive, considérant les règles sur la prescription, qui requièrent que la demande soit déposée pendant une période de temps spécifique après la survenance du dies a quo. Cette affaire est parvenue devant la Cour Suprême de Californie par le biais de la Cour d’appel fédérale pour le Neuvième circuit, sollicitant l’avis des Juges californiens sur une question de droit californien, question ainsi formulée : lorsque des dommages corporels multiples et distincts apparaissent –est-il allégué – du fait de fumer des produits du tabac, le dies a quo pour l’ensemble des dommages corporels est-il le jour de la survenance du dommage corporel le plus antérieur? La Cour Suprême de Californie juge que deux types de dommage corporel, tous les deux causés par le même tabac fumé pendant la même période de temps, peuvent, dans certaines circonstances, être considérés comme qualitativement différents dans le but de déterminer à quel moment le délai de prescription commence à courir. Spécifiquement, lorsqu’une maladie découverte ultérieurement est séparée et distincte d’une maladie découverte antérieurement, cette dernière ne fait pas courir le délai de prescription pour ce qui est de l’action en justice portant sur la maladie ultérieure. Cette conception est consistante avec les conclusions auxquelles sont parvenues  les Tribunaux d’autres juridictions du pays dans des situations semblables, souvent liées à des procès relatifs aux dommages causés par l’amiante (une liste très complète des cas relevants est donnée ci-dessus dans le texte original). Il est important de noter que la Cour Suprême de Californie limite ici son jugement aux cas de maladies latentes, sans décider si la même règle s’applique dans d’autres contextes. Par ailleurs, en se prononçant dans la présente affaire, dite Cour précise que son rôle ne consiste qu’à répondre à la question que le Neuvième Circuit fédéral lui a posée relativement au contenu du droit californien, et qu’elle ne joue aucun rôle dans la détermination de la question du bien-fondé des allégués de la demanderesse, la question du bien-fondé de ces allégués étant de la compétence des cours fédérales. Spécifiquement, la demanderesse a allégué devant la cour de district fédérale que son cancer des poumons était une maladie séparée et distincte de ses deux autres maladies liées à l’usage du tabac. Bien que cette allégation apparaisse a priori plausible, sa résolution implique une expertise médicale. En conclusion, en réponse à la requête du Neuvième Circuit fédéral, la Cour Suprême de Californie juge que lorsqu’une maladie latente ultérieurement découverte est séparée et distincte d’une maladie antérieurement découverte, la maladie antérieure n’a pas pour effet de faire commencer à courir le délai de prescription s’agissant de la maladie ultérieure.