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Tag: RJ Reynolds

  • Ruling Could End Reynolds’ Vuse Alto Royalty Payments to Altria  

    Ruling Could End Reynolds’ Vuse Alto Royalty Payments to Altria  

    Law360 reported that R.J. Reynolds has secured a potentially significant reduction in the long-term costs associated with its Vuse Alto business, after a North Carolina federal court ruled that a sublicense obtained from Juul Labs ends Reynolds’ obligation to make future patent royalty payments to Altria Client Services. The dispute stems from a 2022 jury decision finding that Vuse Alto infringed three Altria patents, resulting in an approximately $95.2 million damages award. Reynolds was later ordered to pay a 5.25% royalty on positive net sales of the affected products.  

    According to Law360, Judge William L. Osteen Jr. found that the Juul sublicense authorized Reynolds’ continued use of the relevant patent rights, eliminating the basis for future infringement royalties. The court rejected Altria’s argument that defects in part of the sublicense invalidated the entire agreement, citing its severability provision. Law360 reported that Altria said potentially “hundreds of millions of dollars” in future royalties were at stake. The ruling does not affect the earlier infringement finding or past damages, but could eliminate Reynolds’ 5.25% royalty payments on future covered Vuse Alto sales.  

  • 5th Circuit Blocks FDA’s 11 Graphic Cigarette Warnings

    5th Circuit Blocks FDA’s 11 Graphic Cigarette Warnings

    The 5th U.S. Circuit Court of Appeals ruled that the FDA exceeded its authority by requiring cigarette packages and advertisements to carry 11 graphic health warnings, upholding a lower-court order that blocked the rule from taking effect. The ruling, reported by Reuters, is a setback for the FDA’s long-running effort to implement the warning-label provisions of the 2009 Family Smoking Prevention and Tobacco Control Act.

    Writing for the three-judge panel, U.S. Circuit Judge Don Willett said Congress authorized nine specific warnings and that the FDA could not add two additional warnings on its own. The FDA’s proposed images covered health effects including bladder, head and neck cancers, fatal lung disease, impaired fetal growth, cataracts, and Type 2 diabetes. “The FDA may require the nine warnings Congress prescribed — no more,” Willett wrote.

    The case was brought by R.J. Reynolds Tobacco Co., ITG Brands, and JTI Liggett after the FDA revived the graphic-warning requirement in 2019 following years of litigation. The 5th Circuit previously rejected a First Amendment challenge to the rule in 2024, but a Texas federal judge later blocked it on separate statutory grounds. The latest ruling addresses that issue and leaves the FDA’s implementation of the 2009 warning requirement facing further legal obstacles. The case is R.J. Reynolds Tobacco Company v. Food and Drug Administration, No. 25-40137.

  • RJR Seeks to Block Lawyer’s Live Testimony in Altria Dispute

    RJR Seeks to Block Lawyer’s Live Testimony in Altria Dispute

    R.J. Reynolds Vapor Co. asked a North Carolina court to quash a trial subpoena that would require one of its in-house attorneys to testify in person at an evidentiary hearing in an ongoing royalty dispute with Altria Group. The company argues that a previously recorded deposition of the attorney should suffice, saying live testimony would be unnecessary and burdensome.

    The dispute centers on royalty obligations tied to vaping technology and agreements between the rival firms. Reynolds maintains that compelling its lawyer to appear would intrude on privileged matters and exceed what is needed for the court to assess the evidentiary issues. The matter is before a judge in North Carolina, who will decide whether the deposition recording can replace in-court testimony.

    Source: Law 360 (pay)

  • Baltimore Argues 1998 MSA Doesn’t Cover Cigarette Litter

    Baltimore Argues 1998 MSA Doesn’t Cover Cigarette Litter

    The City of Baltimore told a Maryland state court that the 1998 Master Settlement Agreement does not shield tobacco companies from liability in its lawsuit over environmental harm caused by nonbiodegradable cigarette filters. The city is seeking to proceed with claims against R.J. Reynolds Tobacco Company, Philip Morris USA, and Liggett Group LLC, arguing that the decades-old settlement addressed healthcare costs related to smoking, not municipal expenses tied to cigarette butt litter and environmental cleanup. Baltimore contends that its suit targets a separate issue involving plastic filter waste and the burden placed on city services, and therefore should not be dismissed on preemption grounds.

  • EG America and RJR’s Reconfigured Planogram Paying Off

    EG America and RJR’s Reconfigured Planogram Paying Off

    EG America’s said its backbar optimization strategy is driving significant results, with modern oral nicotine products achieving double-digit volume growth in 2025 and outpacing industry trends in the segment. Operating more than 1,500 locations, the retailer partnered with R.J. Reynolds to expand its VELO Plus synthetic nicotine pouch line, using analytics and supplier collaboration to optimize space and assortment. By reallocating underperforming areas and adding new facings without disrupting category balance, EG America created a planogram designed for growth, supporting top-selling segments while maintaining overall visibility.

  • ITC Opens ENDS Investigation on Reynolds Complaint

    ITC Opens ENDS Investigation on Reynolds Complaint

    The U.S. International Trade Commission (USITC) has launched an investigation into certain disposable and closed-system electronic nicotine delivery systems and related components following a complaint filed by R.J. Reynolds Tobacco and affiliated companies. The complaint alleges violations of the Prevent All Cigarette Trafficking (PACT) Act, state and local flavor bans, directory requirements, and excise tax compliance, claiming that imports and sales of these products threaten the U.S. industry.

    Respondents include nine U.S. distributors such as D&A Distribution and Midwest Goods, as well as seven manufacturers based in China and Hong Kong, including Geek Miracle and Shenzhen Geekvape Technology. The USITC has not ruled on the merits and will hold evidentiary hearings before issuing a determination, with potential remedies including exclusion and cease-and-desist orders.

  • RJR Closes Arguments in $14M Smoker Lawsuit

    RJR Closes Arguments in $14M Smoker Lawsuit

    A Florida jury heard closing arguments on Monday (January 27) in a lawsuit seeking $14 million in damages from R.J. Reynolds Tobacco Co. for the pain and suffering of a former smoker who later required a lung transplant. Attorneys for the plaintiff argued that the company should be held liable for 14 years of debilitating health consequences caused by smoking-related disease, including severe respiratory failure that ultimately led to the transplant.

    The case is part of Florida’s long-running Engle progeny litigation, which allows individual smokers or their families to pursue damages against tobacco companies. R.J. Reynolds disputed the damages claim, arguing that the smoker was aware of the risks associated with cigarettes and continued smoking despite widespread public health warnings. The jury is expected to decide whether the company is legally responsible and, if so, the appropriate level of compensation.

  • Reynolds Files Complaint with ITC Over Illicit Products

    Reynolds Files Complaint with ITC Over Illicit Products

    R.J. Reynolds Tobacco Co. and its subsidiaries have filed a complaint with the U.S. International Trade Commission seeking an investigation into alleged unlawful practices by Heaven Gifts International—the company behind Elf Bar and Geek Bar—along with its subsidiaries and nine U.S. distributors. According to Law360, the 247-page complaint accuses the respondents of selling flavored vaping products in jurisdictions where they are banned, selling products not listed in required state directories at the time of sale, and evading state and local excise taxes, conduct Reynolds frames as unfair competition under Section 337 of the Tariff Act and noncompliance with the PACT Act. The ITC has acknowledged receipt of the complaint and opened a public comment process.

    Reynolds argues that the alleged violations have enabled a large, illicit market that has significantly undercut lawful products such as its Vuse brand. The company pointed to FDA data showing that only 39 e-cigarette products and devices are currently authorized for sale in the U.S., including 16 from Reynolds and none from Heaven Gifts or its affiliates. Reynolds is seeking broad remedies, including a general or limited exclusion order blocking imports of the accused products, cease-and-desist orders against the named companies, and the imposition of a bond during the ITC’s 60-day presidential review period.

  • Philip Morris Pushes for Arbitration in Washington MSA Dispute

    Philip Morris Pushes for Arbitration in Washington MSA Dispute

    Philip Morris USA (PM USA) urged a King County Superior Court judge in Washington State to compel arbitration in its dispute with R.J. Reynolds (RJR) and other tobacco companies. The conflict centers on longstanding disagreements over the annual Master Settlement Agreement (MSA) payments to the state.

    RJR and fellow plaintiffs claim PM USA aims to derail a separate 2025 settlement signed between RJR and Washington by attempting to enforce an arbitration clause dating back to a 2017 agreement. They argue PM USA is improperly interfering in a deal it is not directly part of.

    This week, in response, PM USA submitted a motion to compel arbitration, asserting that RJR and the other defendants are bound by the 2017 arbitration clause and that the court must defer to this private resolution mechanism. The outcome of this procedural motion could significantly influence the future of tobacco payment disputes under the MSA—either moving them out of public courtrooms or keeping them subject to private arbitration panels.

  • Massachusetts Judge Issues Record-Setting Judgement

    Massachusetts Judge Issues Record-Setting Judgement

    A judge in Hampden County, Massachusetts, issued one of the biggest individual civil judgments in history, awarding $105 million to the family of a deceased smoker. Judge Edward McDonough Jr.’s decision came a month after a jury awarded the plaintiffs $10.6 million after a month-long trial, with the judge saying the defendant, R.J. Reynolds, “willfully and wantonly” engaged in a conspiracy to hide the health hazards of cigarette smoking.

    Kevin Penza, along with his daughter, Kimberly Breen Penza, sued on behalf of his late wife, Jacqueline, who died from lung cancer at 59. The plaintiffs argued Jacqueline spent much of her life trying to quit the smoking habit, but was trapped in a nicotine addiction she could not defeat. The defense countered she was a committed smoker who made her own choices and refused to quit despite pleas from her family and doctors.

    McDonough began with the jury’s $10.6 million decision and added $2 million in attorney’s fees. The additional sum included interest and fees, but he did not clarify how the final sum was reached. R.J. Reynolds is expected to appeal this ruling.