[Federal Register Volume 86, Number 145 (Monday, August 2, 2021)]
[Notices]
[Pages 41509-41511]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-16374]



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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1199]


Certain Tobacco Heating Articles and Components Thereof; 
Commission Determination To Review in Part a Final Initial 
Determination Finding a Violation of Section 337; Schedule for Filing 
Written Submissions on Issues Under Review and on Remedy, Public 
Interest, and Bonding

AGENCY: International Trade Commission.

ACTION: Notice.

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SUMMARY: Notice is hereby given that the U.S. International Trade 
Commission (``Commission'') has determined to review in part a final 
initial determination (``FID'') of the presiding administrative law 
judge (``ALJ'') finding a violation of section 337 of the Tariff Act of 
1930, as amended, in the above-captioned investigation. The Commission 
requests briefing from the parties on certain issues under review, as 
indicated in this notice. The Commission also requests briefing from 
the parties, interested government agencies, and interested persons on 
the issues of remedy, the public interest, and bonding.

FOR FURTHER INFORMATION CONTACT: Lynde Herzbach, Office of the General 
Counsel, U.S. International Trade Commission, 500 E Street SW, 
Washington, DC 20436, telephone (202) 205-3228. Copies of non-
confidential documents filed in connection with this investigation may 
be viewed on the Commission's electronic docket (EDIS) at https://edis.usitc.gov. For help accessing EDIS, please email 
[email protected]. General information concerning the Commission may 
also be obtained by accessing its internet server at https://www.usitc.gov. Hearing-impaired persons are advised that information on 
this matter can be obtained by contacting the Commission's TDD terminal 
on (202) 205-1810.

SUPPLEMENTARY INFORMATION: On May 15, 2020, the Commission instituted 
this investigation under section 337 of the Tariff Act of 1930, as 
amended, 19 U.S.C. 1337 (``section 337''), based on a complaint filed 
by RAI Strategic Holdings, Inc., R.J. Reynolds Vapor Company, and R.J. 
Reynolds Tobacco Company, all of Winston-Salem, North Carolina 
(collectively, ``Complainants''). See 85 FR 29482-83. The complaint, as 
supplemented, alleges a violation of section 337 based upon the 
importation of certain tobacco heating articles and components thereof 
by reason of infringement of certain claims of U.S. Patent Nos. 
9,839,238 (``the '238 patent''); 9,930,915 (``the '915 patent''); 
9,901,123 (``the '123 patent) (collectively, ``the Asserted Patents''). 
The complaint also alleges the existence of a domestic industry. The 
notice of investigation names five respondents: Altria Client Services 
LLC, Altria Group, Inc. (``AGI''), and Philip Morris USA, Inc., all of 
Richmond, Virginia; Philip Morris International Inc. (``PMI'') of New 
York, New York; and Philip Morris Products S.A. of Neuchatel, 
Switzerland (collectively, ``Respondents''). See id. The Office of 
Unfair Import Investigations (``OUII'') is also a party to the 
investigation. See id.
    The Commission previously terminated respondents AGI and PMI from 
the investigation based on Complainants' partial withdrawal of the 
complaint. See Order No. 24 (Dec. 14, 2020), unreviewed by Comm'n 
Notice (Jan. 5, 2021).
    The Commission previously affirmed an initial determination finding 
that the economic prong is satisfied under section 337(a)(3)(A) (19 
U.S.C. 1337(a)(3)(A)) with respect to the '238 and '915 patents and 
provided supplemental analysis. Order No. 35 (Jan. 19, 2021), affirmed 
in part by Comm'n Notice (Feb. 18, 2021). The Commission took no 
position on the finding that the economic prong was satisfied under 
section 337(a)(3)(B) (19 U.S.C. 1337(a)(3)(B)). Id.
    On May 14, 2021, the presiding ALJ issued the FID on violation. The 
FID finds a violation of section 337 as to the '915 patent and the '123 
patent by virtue of Respondents' infringement of claims 1-3 and 5 of 
the '915 patent and claims 27-30 of the '123 patent. The FID finds that 
Complainants did not establish a violation with respect to the '238 
patent. In particular, the FID finds that Respondents failed to show 
that the asserted claims of the '915 and '123 patents are invalid. The 
ID further finds that claim 19 of the '238 patent is invalid as 
anticipated. The FID finds that the domestic industry requirement is 
satisfied for each of the Asserted Patents.
    The Recommended Determination on Remedy and Bond (``RD'') 
recommends the issuance of a limited exclusion order barring entry of 
products that infringe the asserted claims of the Asserted Patents. The 
RD does not recommend issuing cease and desist orders. The RD 
recommends imposing no bond during the Presidential review period. 
Finally, the RD concludes that the public interest evidence does not 
weigh against entry of a remedy.
    On May 28, 2021, Complainants, Respondents, and OUII each filed 
petitions for review of various aspect of the FID. Specifically, 
Complainants filed a petition for review of the FID's infringement and 
validity findings for the '238 patent. Respondents filed a petition for 
review that challenges aspects of the FID's construction of 
``electrical energy source'' recited in claims 1 and 3 of the '915 
patent. Respondents also petitioned for review of the FID's findings 
concerning infringement and invalidity with respect to the '915 and 
'123 patents, and the FID's domestic industry findings for the '123 
patent. Respondents contingently petitioned for review of the 
constructions of ``pressure channel'' and ``air inlet channel'' recited 
in claim 19 of the '238 patent, as well as the FID's infringement 
findings based on the alleged incorrect claim constructions. OUII filed 
a petition for review of the constructions of ``pressure channel'' and 
``air inlet channel'' recited in claim 19 of the '238 patent, and the 
FID's infringement findings based on the limitation ``spatially 
separated'' recited in claim 19.
    On June 8, 2021, the parties filed their respective responses to 
the various petitions for review. That same day, Respondents filed a 
motion to strike-in-part Complainants' petition for review to the 
extent the petition sought review of the RD. On June 21, 2021, 
Complainants filed a response opposing the motion. OUII did not file a 
response.
    Having examined the record of the investigation, including the FID, 
the petitions for review, and the responses thereto, the Commission has 
determined to review the FID in part, as follows.
    As to the '915 patent, the Commission has determined to review the 
ALJ's construction of the limitation ``electrical energy source'' 
recited in asserted claims 1 and 3 and the FID's infringement, 
technical prong, and invalidity findings to the extent they may be 
affected by a modified claim construction.
    As to the '123 patent, the Commission has determined to review the 
FID's obviousness and domestic industry findings, including whether 
Complainants have satisfied the economic prong of the domestic industry 
requirement.
    As to the '238 patent, the Commission has determined to review the 
FID's infringement finding.
    The Commission has determined not to review the remainder of the 
FID. The Commission denies Respondents' motion to strike-in-part 
Complainants' petition for review.

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    The parties are asked to provide additional briefing on the 
following issues:

    With regard to the '915 patent, please address whether a 
construction of the term ``electrical energy source'' to mean 
``receptacle that provides for transmission of electrical current 
from the power source to the heating member, where the receptacle is 
not limited to a structure that requires wiring or insertion,'' is 
supported by the intrinsic and extrinsic evidence. Also, please 
address whether this modified claim construction affects any other 
findings in the FID regarding the '915 patent such as infringement, 
domestic industry technical prong, or invalidity.

    The parties are requested to brief only the discrete issues 
identified above, with reference to the applicable law and evidentiary 
record. The parties are not to brief any other issues on review, which 
have already been adequately presented in the parties' previous 
filings.
    In connection with the final disposition of this investigation, the 
statute authorizes issuance of, inter alia, (1) an exclusion order that 
could result in the exclusion of the subject articles from entry into 
the United States; and/or (2) cease and desist orders that could result 
in the respondents being required to cease and desist from engaging in 
unfair acts in the importation and sale of such articles. Accordingly, 
the Commission is interested in receiving written submissions that 
address the form of remedy, if any, that should be ordered. If a party 
seeks exclusion of an article from entry into the United States for 
purposes other than entry for consumption, the party should so indicate 
and provide information establishing that activities involving other 
types of entry either are adversely affecting it or likely to do so. 
For background, see Certain Devices for Connecting Computers via 
Telephone Lines, Inv. No. 337-TA-360, USITC Pub. No. 2843, Comm'n Op. 
at 7-10 (Dec. 1994). In particular, the written submissions should 
address any request for a cease and desist order in the context of 
recent Commission opinions, including those in Certain Arrowheads with 
Deploying Blades and Components Thereof and Packaging Therefor, Inv. 
No. 337-TA-977, Comm'n Op. (Apr. 28, 2017) and Certain Electric Skin 
Care Devices, Brushes and Chargers Therefor, and Kits Containing the 
Same, Inv. No. 337-TA-959, Comm'n Op. (Feb. 13, 2017). Specifically, if 
Complainants seek a cease and desist order against any respondent, the 
written submissions should respond to the following requests:
    (1) Please identify with citations to the record any information 
regarding commercially significant inventory in the United States as to 
each respondent against whom a cease and desist order is sought. If 
Complainants also rely on other significant domestic operations that 
could undercut the remedy provided by an exclusion order, please 
identify with citations to the record such information as to each 
respondent against whom a cease and desist order is sought.
    (2) In relation to the infringing products, please identify any 
information in the record, including allegations in the pleadings, that 
addresses the existence of any domestic inventory, any domestic 
operations, or any sales-related activity directed at the United States 
for each respondent against whom a cease and desist order is sought.
    (3) Please discuss any other basis upon which the Commission could 
enter a cease and desist order.
    The statute requires the Commission to consider the effects of that 
remedy upon the public interest. The public interest factors the 
Commission will consider include the effect that an exclusion order 
and/or cease and desist orders would have on: (1) The public health and 
welfare, (2) competitive conditions in the U.S. economy, (3) U.S. 
production of articles that are like or directly competitive with those 
that are subject to investigation, and (4) U.S. consumers. The 
Commission is therefore interested in receiving written submissions 
that address the aforementioned public interest factors in the context 
of this investigation. The submissions should include a discussion of 
the RD's findings on the public interest.
    If the Commission orders some form of remedy, the U.S. Trade 
Representative, as delegated by the President, has 60 days to approve, 
disapprove, or take no action on the Commission's determination. See 
Presidential Memorandum of July 21, 2005, 70 FR 43251 (July 26, 2005). 
During this period, the subject articles would be entitled to enter the 
United States under bond, in an amount determined by the Commission and 
prescribed by the Secretary of the Treasury. The Commission is 
therefore interested in receiving submissions concerning the amount of 
the bond that should be imposed if a remedy is ordered.
    Written Submissions: The parties to the investigation are requested 
to file written submissions on the issues identified in this notice. In 
addition, the parties to the investigation, interested government 
agencies, and any other interested parties are encouraged to file 
written submissions on the issues of remedy, the public interest, and 
bonding. Such submissions should address the recommended determination 
by the ALJ on remedy and bonding.
    In their initial submissions, Complainants are also requested to 
identify the remedy sought and Complainants and OUII are requested to 
submit proposed remedial orders for the Commission's consideration. 
Complainants are further requested to state the dates that the Asserted 
Patents expire, to provide the HTSUS subheadings under which the 
accused products are imported, and to supply the identification 
information for all known importers of the products at issue in this 
investigation. The initial written submissions and proposed remedial 
orders must be filed no later than close of business on August 10, 
2021. Reply submissions must be filed no later than the close of 
business on August 17, 2021. No further submissions on these issues 
will be permitted unless otherwise ordered by the Commission.
    Persons filing written submissions must file the original document 
electronically on or before the deadlines stated above. The 
Commission's paper filing requirements in 19 CFR 210.4(f) are currently 
waived. 85 FR 15798 (March 19, 2020). Submissions should refer to the 
investigation number (Inv. No. 337-TA-1199) in a prominent place on the 
cover page and/or the first page. (See Handbook for Electronic Filing 
Procedures, https://www.usitc.gov/documents/handbook_on_filing_procedures.pdf). Persons with questions regarding 
filing should contact the Secretary, (202) 205-2000.
    Any person desiring to submit a document to the Commission in 
confidence must request confidential treatment by marking each document 
with a header indicating that the document contains confidential 
information. This marking will be deemed to satisfy Rules 201.6 and 
210.5(e)(2) (19 CFR 201.6 & 210.5(e)(2)). Documents for which 
confidential treatment by the Commission is properly sought will be 
treated accordingly. A redacted non-confidential version of the 
document must also be filed simultaneously with any confidential 
filing. All information, including confidential business information 
and documents for which confidential treatment is properly sought, 
submitted to the Commission for purposes of this investigation may be 
disclosed to and used: (i) By the

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Commission, its employees and Offices, and contract personnel (a) for 
developing or maintaining the records of this or a related proceeding, 
or (b) in internal investigations, audits, reviews, and evaluations 
relating to the programs, personnel, and operations of the Commission 
including under 5 U.S.C. appendix 3; or (ii) by U.S. government 
employees and contract personnel, solely for cybersecurity purposes. 
All contract personnel will sign appropriate nondisclosure agreements. 
All nonconfidential written submissions will be available for public 
inspection on EDIS.
    The Commission vote for this determination took place on July 27, 
2021.
    The authority for the Commission's determination is contained in 
section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and 
in Part 210 of the Commission's Rules of Practice and Procedure (19 CFR 
part 210).

    By order of the Commission.

    Issued: July 27, 2021.
Lisa Barton,
Secretary to the Commission.
[FR Doc. 2021-16374 Filed 7-30-21; 8:45 am]
BILLING CODE 7020-02-P