Baltimore Federal Jury Rejects Star’s Patent Infringement Claims Against R.J. Reynolds

On Tuesday a Baltimore federal district court jury rejected Star Scientific’s patent claims against Reynolds American, handing Reynolds a major victory over the upstart tobacco company in its attempt to translate its tobacco curing methods into hundreds of millions of dollars in damages and licensing fees. The jury verdict was a wipeout for Star: Jurors not only found its patents invalid but also said Reynolds did not infringe. It doesn’t get much more resounding than that, folks. Star’s shares, according the The Wall Street Journal’s account of the verdict, fell more than 80 percent after the jury ruled.

In closing arguments at the monthlong trial, Star’s lawyer, Richard McMillan of Crowell & Moring, had argued that Star was dedicated to finding ways to reduce harm from tobacco. “Nobody could believe it,” he said, when Star chief executive Johnnie Williams invented a new curing method (initially using an old clothes dryer and microwave ovens) that reduced cancer-causing tobacco-specific nitrosamines.

Reynolds’s lead lawyer, Richard Kaplan of Brinks Hofer Gilson & Lione, countered that Reynolds had its own methods for curing tobacco to reduce carcinogens. “Star is taking credit for the hard work and diligent efforts of other people,” he told the jury. Kaplan referred our call for comment to his client, which told the Journal that it was pleased with the verdict. “[Jurors] saw what we have known all along, that Star’s patents are invalid, and they should not have been issued in the first place,” a Reynolds spokesperson said.

McMillan told the Litigation Daily on Wednesday that Star will file posttrial motions asking Judge Marvin Garbis to reverse the verdict, and, if those are not successful, will appeal. The Crowell & Moring partner said Reynolds based its case on whether the tobacco farmers that Star alleged to infringe its patents used an earlier curing method developed by a Reynolds scientist. “We moved at the outset to strike that and focus on the relevant issues we were trying, which were whether the farmers did in fact perform each element of the [Star] patents,” McMillan said. “We think there were an extraordinary number of errors made by the trial judge.”

Given Star’s history with Judge Garbis, we’d put odds against him tossing the jury verdict. Star first sued Reynolds in 2001, claiming infringement of two of its patents. Reynolds responded with claims of inequitable conduct. After a 2005 bench trial to determine whether Star intentionally deceived the Patent and Trademark Office, in 2007 Garbis dismissed all of Star’s claims on grounds of indefiniteness and inequitable conduct. In that decision, Garbis faulted McMillan for failing to disclose a 1998 letter from a Star consultant suggesting the company’s technology was not new.

The U.S. Court of Appeals for the Federal Circuit reversed Garbis’s ruling last year (Carter Phillips of Sidley Austin argued for Star; Reynolds stuck with Rich Kaplan), and the case was returned to Garbis’s courtroom for trial. (Here’s our previous coverage of the Federal Circuit ruling.) “It’s been a struggle of titanic proportions,” Judge Garbis said Monday.

Similar Posts:

If you enjoyed this post, make sure you subscribe to my RSS feed!