Case 1:20-cv-00393-LO-TCB Document 947 Filed 02/07/22 Page 1 of 5 PageID# 26203
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF VIRGINIA
`Alexandria Division
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`RAI Strategic Holdings, Inc., et. ai..
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`Plaintiffs,
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`V.
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`Altria Client Services, LLC, et. ai..
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`Defendants.
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`Civil Action No. 1:20-cv-393
`Hon. Liam O'Grady
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`Introduction
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`ORDER
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`This matter comes before the Court regarding the counterclaim Plaintiffs', Phillip Morris
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`USA Inc. and Altria Client Services LLC (collectively "PM/Altria"), Motion for Summary
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`Judgment. Dkt. 695. The matter has been fully briefed by the Parties.
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`Procedural Background
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`The Parties in this action are all companies that manufacture, design, and produce
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`electronic cigarettes. See Dkt. 199 at 2. The Parties are moving to trial on counterclaims asserted
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`by PM/Altria which allege that several of their patents have been infringed.' Dkt. 199. The
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`counterclaim Defendants, RAI Strategic Holdings and R.J. Reynolds Vapor Company
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`(collectively "RJR"), have filed an answer to the counterclaims in which they assert several
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`affirmative defenses. Dkt. 523 at 17. PM/Altria has moved for summary judgment seeking a
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`' These Patents are U.S. Patents number 9,814,265 (the '265 patent); 10,555,556 (the
`'556 patent); and the 10,104,911 (the '911 patent).
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`I
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`declaration that would preclude RJR from raising these affirmative defenses. Dkt. 695 at 8. The
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`Court has previously issued two Orders regarding the competing Motions for Summary
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`Judgment filed in this case. Dkt. 803; Dkt. 804. At the request of PM/Altria, the Court now
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`issues this Order in the hopes ofoffering clarification on the issues raised in PM/Alltria’s
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`Summary Judgment Motion. See Dkt. 925.
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`Legal Standard
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`A party may move for summary judgmentby identifying either a claim or defense, or a
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`part of a claim or defense, on which summary judgment is sought. Federal Rule of Civil
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`Procedure 56. Summary judgmentwill be granted “if the movant showsthat there is no genuine
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`dispute as to any material fact.” /d. A party opposing a motion for summary judgment must
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`respond with specific facts, supported by proper documentary evidence, showing that a genuine
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`dispute of material fact exists, and that summary judgment should not be granted in favor of the
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`moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The Fourth Circuit has
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`held, “the mere existence of somealleged factual dispute between the parties will not defeat an
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`otherwise properly supported motion for summary judgment; the requirementis that there be no
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`genuineissue of material fact.” Bouchat v. Baltimore Ravens Football Club, Inc., 346 F.3d 514,
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`519 (4th Cir. 2003) (quoting Anderson, 477 U.S. at 247-248). “It is the responsibility of the party
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`seeking summary judgment to inform the court of the basis for its motion, and to identify the
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`parts of the record which it believes demonstrate the absence of a genuine issue of material fact.”
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`Hyatt vy. Avco. Fin. Servs. Mgmt. Co., 2000 U.S. Dist. Lexis 13645, at 11 (E.D. Va. March 2,
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`2000) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)); aff'd, 22 F. App’x 81 (4th Cir.
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`2000).
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`tw
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`Discussion
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`As an initial matter, PM/Altria has requested summary judgment on four affirmative
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`defenses asserted by RJR against the counterclaim. Dkt. 696 at 26. PM/Altria contends that some
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`of these defenses will not be pursued by RJR. /d. at 29. RJR has represented to the Court that
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`some of these defenses have been withdrawn. Dkt. 735 at 18. RJR has withdrawn the defenses of
`estoppel, acquiescence, waiver, or unclean hands on the ‘911 and ‘556 patents. /d. RJR has
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`withdrawn the equitable defense of unclean handsas to the ‘545 patent. /d. RJR has withdrawn
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`the equitable defense of estoppel, acquiescence, or waiver as to the ‘374 and ‘265 patents. RJR
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`has also withdrawn the equitable defenses of limitation of damages and extraterritorial claims.
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`Id. at 19, 22. RJR has also withdrawn the defense of inequitable conduct as to the ‘545 patent. /d.
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`at 6. Although PM/Altria makes a strong argumentin favor of granting summary judgment, the
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`Court will decline to do so. Therefore, based on the representations made by RJR in their
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`memorandum, the Court will DISMISS WITH PREJUDICEthe equitable defenses that are
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`identified above.
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`Second, PM/Altria has asserted that “For those affirmative defenses not expressly
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`abandonedat the eleventh hour, RJR has failed to point amy factual allegations to support their
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`Fifth, Sixth, Eighth, and Eleventh Affirmative Defenses.” Dkt. 696 at 29 (emphasis in original).
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`These affirmative defenses are the equitable defenses of estoppel, acquiescence, and waiveras to
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`the ‘545 patent. /d. In their memorandum in opposition, RJR argues that facts within the record
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`support the denial of summary judgment. Dkt. 728 at 25. Namely, RJR argues that the issue date
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`of the ’545 patent can establish a timeframe upon which a Court could find the factual predicate
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`for these equitable defenses. /d. At this time, the Court does not find it is appropriate to grant
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`summary judgment on these equitable defenses. Accordingly, the motion for summary judgment
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`regarding these defenses is held in ABEYANCE.
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`Third, PM/Altria argues that summary judgment should be granted to dismiss the defense
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`of ensnarement becausethere are no facts that would support this defense. Dkt. 751 at 9. A party
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`cannot prove a doctrine of equivalence theory for infringementif a hypothetical claim that covers
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`the accused device would be “ensnared”by the prior art. Depuy Spine, Inc. v. Medtronic Sofamor
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`Danek, Inc., 567 F.3d 1314, 1322 (Fed. Cir. 2009). Even if a jury finds infringement based on
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`the doctrine of equivalence, a court can still find ensnarement as a matter of law. /d. at 1323. To
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`defeat ensnarement, the person asserting the patent has the burden of production to propose a
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`hypothetical claim that covers the accused device. Jang v. Boston Sci. Corp., 872 F.3d 1275,
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`1287 (Fed. Cir. 2017) (Because, as a threshold matter, Dr. Jang failed to submit a proper
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`hypothetical claim for consideration, he was unable to meet his burden of proving that his
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`doctrine of equivalents theory did not ensnare the priorart.”) The Federal Circuit has held that
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`district courts have discretion upon when and upon what type of motion to decide ensnarement.
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`Id. at 1374 (The Federal Circuit held that a district court can--but isn’t required--to decide
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`ensnarementeither during summary judgmentor on a judgmentas a matter oflaw).
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`In the current case, PM/Altria has not proposed a hypothetical claim construction upon
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`which the Court could evaluate a finding of ensnarement. In an abundance ofcaution, and as
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`there is no requirement to decide the issue of ensnarement at present, the Motion for Summary
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`Judgmentas to this asserted defense is DENIED.
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`Finally, PM/Altria has argued that the Court should deny the defense that the ‘374 patent
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`is invalid. Dkt. 696 at 25. PM/Altria argues that the ‘374 patent cannot be invalid because the
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`inventor, Mr. Liu,
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`is the same inventor ofthe Chinese Utility patent that is allegedly priorart.
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`Dkt. 696 at 18. PM/Altria argues that because Mr. Liu is the same inventor, the Chinese Utility
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`patent cannot be found to anticipate. /d. at 18.
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`What canbeasserted as priorart will be determined by what priority date is given to the
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`“374 patent. The Court has previously found that “there is a triable issue of fact as to whether the
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`‘374 patentis entitled to the earlier June 29, 2010 filing date of the 949 PCT.” Dkt. 803 at 2. This
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`issue of fact will determine what prior art or
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`invention can be asserted to claim either
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`obviousness or anticipation. Therefore, a genuine issue of material
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`facts exists regarding the
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`validity of the ‘374 patent. Therefore,
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`the Motion for Summary Judgment on the issue of
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`invalidity is DENIED.
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`Conclusion
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`For the foregoing reasons, the Motion for Summary judgment (Dkt. 695) is DENIED IN
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`PART and HELD IN ABEYANCE IN PART.
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`Itis so ORDERED.
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` February |, 2022 Liam ah
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`Alexandria, Virginia
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`United States District Judge
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`* The Parties dispute whether Mr. Liu is the same inventor that is listed on the Chinese
`utility patent. The dispute appears to originate from conflicting Chinese to English
`translations. Currently, RJR appears to concede that Mr. Liu is the same person, but that
`PM/Altria should not be able to assert this at trial because it was not properly disclosed
`during discovery. Dkt. 728 at 5.
`It
`is unnecessary to resolve this dispute in the current
`Order, but the Parties are encouragedto confer with each other to see what action (if any)
`would be necessaryto resolve this issue.
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`A
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