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[Federal Register Volume 89, Number 218 (Tuesday, November 12, 2024)]
[Notices]
[Pages 89041-89044]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-26161]

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INTERNATIONAL TRADE COMMISSION

[Investigation No. 337-TA-1368]

Certain Vaporizer Devices, Cartridges Used Therewith, and 
Components Thereof; [Revised] Notice of Commission Determination To 
Review in Part a Final Initial Determination Finding a Violation of 
Section 337; Request for Written Submissions on the Issues Under Review 
and on Remedy, the Public Interest, and Bonding

AGENCY: U.S. International Trade Commission.

ACTION: Notice.

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SUMMARY: The Commission has determined to review in part a final 
initial determination (``ID'') issued by the presiding administrative 
law judge (``ALJ'') in the above-captioned investigation finding a 
violation of section 337. The Commission requests written submissions 
from the parties on the issues under review and submissions from the 
parties, interested government agencies, and interested persons on the 
issues of remedy, the public interest, and bonding under the schedule 
set forth below.

FOR FURTHER INFORMATION CONTACT: Richard P. Hadorn, Esq., Office of the 
General Counsel, U.S. International Trade Commission, 500 E Street SW, 
Washington, DC 20436, telephone (202) 205-3179. 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, telephone (202) 205-1810.

SUPPLEMENTARY INFORMATION: The Commission instituted this investigation 
on August 7, 2023, based on a complaint filed by JUUL Labs, Inc. of 
Washington, DC and VMR Products LLC of San Francisco, California 
(together, ``JLI''). 88 FR 52207 (Aug. 7, 2023). The complaint, as 
supplemented, alleges violations of section 337 of the Tariff Act of 
1930, as amended, 19 U.S.C. 1337 (``section 337''), based on the 
importation into the United States, the sale for importation, and/or 
the sale within the United States after importation of certain 
vaporizer devices, cartridges used therewith, and components thereof by 
reason of infringement of certain claims of U.S. Patent Nos. RE49,114 
(``the '114 patent''), 10,130,123 (``the '123 patent''), 10,709,173 
(``the '173 patent''), 11,134,722 (``the '722 patent''), and 11,606,981 
(``the '981 patent''). Id. The complaint further alleges that a 
domestic industry (``DI'') exists. Id. The notice of investigation 
names five respondents: (1) NJOY, LLC of Phoenix, Arizona; (2) NJOY 
Holdings, Inc. of Scottsdale, Arizona; (3) Altria Group, Inc. of 
Richmond, Virginia; (4) Altria Group Distribution Company of Richmond, 
Virginia; and (5) Altria Client Services LLC of Richmond, Virginia 
(collectively, ``NJOY''). Id. The Office of Unfair Import 
Investigations (``OUII'') is also named as a party. Id. The Commission 
also directed the ALJ to take evidence on and provide factual findings 
and a recommended determination concerning the public interest. Id.
    On April 3, 2024, the Commission terminated the investigation as to 
the following asserted claims based on partial withdrawal of the 
complaint: (i) claims 1, 5-7, 29, 30, 36, 80, 89, and 93 of the '114 
patent; (ii) claims 16, 18, 29, and 31 of the '123 patent; (iii) claims 
3, 8, 14, and 17 of the '722 patent; and (iv) claims 6, 9-11, 17, and 
18 of the '981

[[Page 89042]]

patent. Order No. 18 (Mar. 6, 2024), unreviewed by Comm'n Notice (Apr. 
3, 2024).
    On April 26, 2024, the Commission terminated the investigation as 
to the following asserted claims based on partial withdrawal of the 
complaint: (i) claims 43, 44, 76, 77, 81, and 86 (all remaining claims) 
of the '114 patent, thus terminating the '114 patent in its entirety; 
(ii) claim 14 of the '123 patent; (iii) claims 2, 3, 6, 7, 15, 16, 18-
25, 28, and 30 of the '173 patent; (iv) claims 5, 7, 9-13, 16, and 18-
21 of the '722 patent; and (v) claims 2, 5, and 13-16 of the '981 
patent. Order No. 21 (Apr. 2, 2024), unreviewed by Comm'n Notice (Apr. 
26, 2024).
    On June 18, 2024, the Commission affirmed an initial determination 
granting summary determination that JLI has satisfied the economic 
prong of the DI requirement as to the remaining asserted patents, i.e., 
the '123, '173, '722, and '981 patents. Order No. 22 (Apr. 3, 2024), 
aff'd by Comm'n Notice (June 20, 2024).
    On August 23, 2024, the ALJ issued the final ID, which finds a 
violation of section 337 as to claims 27 and 32 of the '123 patent, 
claims 1 and 4 of the '173 patent, claims 1 and 15 of the '722 patent, 
and claims 1 and 8 of the '981 patent. The ID also includes the ALJ's 
recommended determination (``RD'') on remedy, the public interest, and 
bonding. The RD recommends that, should the Commission determine that a 
violation of section 337 has occurred, the Commission should: (i) issue 
a limited exclusion order against NJOY's infringing products; (ii) 
issue cease and desist orders against each of the NJOY respondents; and 
(iii) impose no bond (0 percent bond) for importations of infringing 
products during the period of Presidential review. The ALJ also found 
that the statutory public interest factors do not support denying or 
delaying the recommended relief set forth in the RD.
    On September 6, 2024, NJOY filed a petition seeking review of 
certain findings in the ID, including (i) claim construction and 
infringement of the asserted claims of the '722 and '981 patents, (ii) 
claim construction, infringement, the technical and economic prongs of 
the DI requirement, and validity of the asserted claims of the '123 
patent, and (iii) claim construction, infringement, and the technical 
prong of the DI requirement of the asserted claims of the '173 patent. 
That same day, JLI filed a contingent petition seeking review of 
certain of the ID's findings concerning (i) claim construction, 
infringement, and validity of the '722 and '981 patents, (ii) the 
technical prong of the DI requirement and validity of the '123 patent, 
and (iii) validity of the '173 patent. On September 16, 2024, JLI and 
NJOY each filed a response opposing the other's petition. That same 
day, OUII filed a response addressing both petitions.
    On September 23, 2024, NJOY filed a motion for leave to file a 
reply in support of its petition for review, addressing certain 
positions taken by OUII in its response to NJOY's petition. On 
September 25 and 27, 2024, OUII and JLI, respectively, filed a response 
opposing NJOY's motion for leave.
    On September 24, 2024, JLI and NJOY each filed a submission on the 
public interest pursuant to Commission Rule 210.50(a)(4) (19 CFR 
210.50(a)(4)). The Commission did not receive any submissions on the 
public interest from members of the public or interested government 
agencies in response to the Commission's Federal Register notice. See 
89 FR 70668-69 (Aug. 30, 2024).
    Having reviewed the record of the investigation, including the 
final ID, the parties' submissions to the ALJ, the petitions and the 
responses thereto, and NJOY's motion for leave and the responses 
thereto, the Commission has determined to review the ID in part.
    Specifically, the Commission has determined to review the ID's 
construction of the ``pressure sensor'' limitations (limitations 27[d] 
and 27[e]) recited in claim 27 of the '123 patent. The Commission has 
also determined to review the ID's findings that the NJOY ACE accused 
product, the asserted [ ] and JAGWAR iterations of the JUUL DI system, 
and the asserted JUUL2 DI system literally practice limitations 27[d] 
and 27[e] of claim 27 of the '123 patent under the ID's construction of 
those limitations.
    The Commission has further determined to review certain of the ID's 
findings regarding claim construction and satisfaction of the technical 
prong of the DI requirement with respect to the '173 patent. In 
particular, the Commission has determined to review the ID's 
construction of the claim terms ``mouthpiece'' and ``disposed within'' 
recited in the asserted claims 1 and 4 of the '173 patent. The 
Commission has further determined to review the ID's finding that the 
JUUL2 DI system practices claims 1 and 4 of the '173 patent.
    In view of the parties' submissions and the issues raised with 
regard to satisfaction of the technical prong of the DI requirement, 
the Commission has further determined to reconsider its previous 
finding that JLI has satisfied the economic prong of the DI requirement 
with respect to the '123 patent and the '173 patent based on 
investments related to both the JUUL DI system and the JUUL2 DI system. 
19 CFR 210.47, .48.
    The Commission has determined not to review the remaining findings 
in the ID, including the ID's findings of a violation of section 337 as 
to the '722 and '981 patents. The Commission has further determined to 
deny NJOY's motion for leave to file a reply in support of its petition 
for review.
    In connection with its review, the Commission requests responses to 
the following questions. The parties are requested to brief their 
positions with reference to the applicable law and the existing 
evidentiary record.

    (1) Please explain whether the final ID correctly finds that 
``JLI does not rely on the [ ] iteration as a domestic industry 
product.'' ID at 123 (citing Case Management Conf. Tr. at 8:16-24 
(April 26, 2024) (EDIS Doc. ID 820002)). To the extent it is argued 
that the final ID errs in this finding and JLI asserted the [ ] 
iteration of the JUUL system to satisfy the technical prong of the 
domestic industry requirement with respect to the '123 patent, 
please identify where in the record JLI timely preserved this 
contention so as to avoid a finding of waiver.
    (2) Did JLI explicitly or implicitly waive its right to rely on 
the [ ] iteration of the JUUL system to satisfy the DI requirement 
with respect to the '123 patent?
    (3) Can OUII, as a party to the investigation, assert that the [ 
] iteration of the JUUL system satisfies the DI requirement with 
respect to the '123 patent where the complainant did not allege that 
this product satisfies that requirement? See John Mezzalingua 
Assocs., Inc. v. ITC, 660 F.3d 1322, 1331 (Fed. Cir. 2011); but see 
Certain Liquid Transfer Devices with an Integral Vial Adapter, Inv. 
No. 337-TA-1362, Comm'n Op. at 16-19 (July 26, 2024) (recognizing 
that OUII should have been allowed to raise an invalidity argument 
that was waived by respondents).
    (4) Do the asserted JAGWAR iteration of the JUUL DI system and 
the asserted JUUL2 DI system practice (literally and/or under the 
doctrine of equivalents) limitations 27[d] and 27[e] of claim 27 of 
the '123 patent under a construction of those limitations requiring 
at least one ``pressure sensor'' that has both ``a first side . . . 
exposed to a sealed air flow path'' and ``a second side . . . 
exposed to a device air path open to ambient pressure.''
    (5) Assuming that only the JAGWAR iteration of the JUUL DI 
system and the JUUL2 DI system can be relied upon to satisfy the 
technical prong of the DI requirement, is there any need to further 
consider the allocation of investments related to the economic prong 
findings as to the '123 patent in Order 22? In responding to this 
question, please address the ALJ's finding in Order 26 that JLI 
``did not rely on its [ ] JUUL System for economic domestic industry 
for the '123 patent'' (Order 26 at 1) and the statement in NJOY's 
petition for review that it had not opposed the summary 
determination that JLI has satisfied the economic prong of the 
domestic industry

[[Page 89043]]

requirement ``based on the understanding that JUUL Jagwar and JUUL 2 
were the only domestic industry products for the '123 Patent.'' NJOY 
Pet. at 29.
    (6) Assuming that only the JAGWAR iteration of the JUUL DI 
system and the JUUL2 DI system can be relied upon to satisfy the 
technical prong of the DI requirement, does the record in this 
investigation support an allocation of JLI's investments to only one 
or both those DI products?
    (7) Please confirm that the investments asserted by JLI as to 
the ``JUUL system'' regarding the '123 patent in Order 22 do not 
include investments relating to [ ]. If [ ] investments are 
included, what are the amounts specific only to JAGWAR and to JUUL2? 
Are these revised investments in JAGWAR and JUUL2 regarding the '123 
patent significant under section 337(a)(3) (A) and (B)?
    (8) Please comment on whether remand is necessary to determine 
whether the domestic industry requirement is satisfied as to the 
'123 patent.

    The parties are invited to brief only the discrete issues requested 
above. The parties are not to brief other issues on review, which are 
adequately presented in the parties' existing 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).
    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 
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.
    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. 
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, the public interest, and bonding.
    In its initial written submission, JLI is also requested to 
identify the remedy sought and to submit proposed remedial orders for 
the Commission's consideration. JLI is 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. In its written submission, 
OUII is also requested to submit proposed remedial orders for the 
Commission's consideration.
    The initial written submissions and proposed remedial orders from 
the parties must be filed no later than the close of business on 
November 7, 2024. Reply submissions from the parties must be filed no 
later than the close of business on November 14, 2024. Initial written 
submissions from interested government agencies, and any other 
interested parties must be filed no later than the close of business on 
November 20, 2024. Reply submissions from the interested government 
agencies, and any other interested parties must be filed no later than 
the close of business on November 27, 2024. Opening submissions are 
limited to 60 pages. Reply submissions are limited to 40 pages. No 
further submissions on any of 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 (Mar. 19, 2020). Submissions should refer to the 
investigation number (Inv. No. 337-TA-1368) 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 the request 
procedure set forth in Rules 201.6(b) and 210.5(e)(2) (19 CFR 201.6(b) 
& 210.5(e)(2)). Documents for which confidential treatment by the 
Commission is properly sought will be treated accordingly. Any non-
party wishing to submit comments containing confidential information 
must serve those comments on the parties to the investigation pursuant 
to the applicable Administrative Protective Order. A redacted non-
confidential version of the document must also be filed with the 
Commission and served on any parties to the investigation within two 
business days of 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 
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 October 
24, 2024.
    The authority for the Commission's determination is contained in 
section

[[Page 89044]]

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: November 6, 2024.
Lisa Barton,
Secretary to the Commission.
[FR Doc. 2024-26161 Filed 11-8-24; 8:45 am]
BILLING CODE 7020-02-P
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