Philip Morris invalidates BAT patent, but UK court denies Arrow declaration

The UK High Court has found BAT’s EP 3 367 830 invalid for obviousness over the prior art, after rival Philip Morris commenced an action to clear the way prior to the launch of its ILUMA heat-not-burn cigarette model. The court also rejected BAT’s amendments to the patent claims, based on the claims still being obvious, as well as stating that any amendments would have added matter. BAT counterclaimed for infringement, which judge Richard Hacon also rejected.

However, the court also dismissed Philip Morris’ request for an Arrow declaration against several BAT patent applications, from the same patent family as EP 830, which are currently pending at the European Patent Office. Both parties have been engaged in litigation concerning ‘heat-not-burn’ technology for several years, with the latest models using induction heating technology to heat from within the products. In the UK, Philip Morris launched ILUMA in September 2023.

Philip Morris sues for invalidity

EP 830, which has a priority date of 30 August 2015, covers an “article for use with apparatus for heating smokable material”. In 2021, Philip Morris began proceedings against BAT over EP 830 and another patent, EP 3 344 080, on the basis that they were not obvious over the prior art. However, in March 2022 BAT consented to revocation of EP 080, meaning only EP 830 was at issue.

BAT also counterclaimed for infringement via the sale of Philip Morris’ ILUMA product, although they only reached the market in September 2023. The court upheld the claimant’s argument of invalidity based on obviousness over two pieces of prior art, finding EP 830 invalid for lack of inventive step; it thus rejected BAT’s retaliation of infringement.

A Philip Morris spokesperson provided the following comment to JUVE Patent: “We are grateful to the court for protecting PMI’s significant investment in transforming our industry for the better in its confirmation that BAT’s patent is invalid and not infringed by ILUMA. We are a pioneer in the smoke-free industry and have invested more than USD 10.5 billion to date to develop innovative, science-backed, smoke-free products for adult smokers who don’t quit.”

Arrow declaration falls flat

Alongside the claims for invalidity, Philip Morris also applied for an Arrow declaration in respect of a defined heat-not-burn system, based on pending patent applications at the EPO from the same patent family as EP 830. The claimant sought confirmation that the product description in the applications, which cover induction heat technology in heat-not-burn consumables, would be obvious based on the priority date.

However, the court rejected the argument on the basis that Philip Morris’ commercial interest in seeking an Arrow declaration was unclear. According to the judge, “it is a precondition for the grant of an Arrow injunction that its alleged useful purpose is clearly identified.” The seeking of an Arrow declaration is still relatively unusual in the UK courts. Indeed, after the 2020 decision in Mexichem vs. Honeywell over refrigeration systems, the current case is only the second non-pharmaceutical proceeding to consider the request.

Bigger picture

The most recent decision came in April, when BAT attempted to revoke two Philip Morris patents, EP 3 266 323 and EP 3 741 225, on the grounds of added matter and obviousness over the prior art. The court only considered the obviousness argument for EP 323, with Philip Morris conceding that EP 225 would also be invalid should the court find claim one of EP 323 invalid for obviousness. The court considered both patents separately regarding added matter.

Peter Damerell

However, ultimately the High Court confirmed the validity of both patents and rejected Philip Morris’ claims of infringement from BAT’s glo products. The latter party appealed the decision regarding EP 323, which is likely to be heard in March 2024. Parallel proceedings concerning EP 323 are ongoing in Germany, Poland, the Czech Republic and Romania. Appeal proceedings are also ongoing regarding EP 225.

Furthermore, at the end of 2022, the Court of Appeal in London confirmed the revocation of four patents owned by Philip Morris. The Higher Regional Court Düsseldorf also invalidated a far-reaching injunction against BAT.

Philip Morris turns to boutiques

Several Powell Gilbert partners are involved for Philip Morris against BAT, with the current proceedings seeing turns from Peter Damerell, Alex Wilson and Tim Whitfield. IP boutique Hoyng ROKH Monegier is running the cases over heat-not-burn technology in Germany, with Düsseldorf-based partners Kay Kasper and Tobias Hahn leading proceedings.

In Germany, Dreiss partner and patent attorney Andreas Pfund is handling the technical aspects of the cases, such as regarding EP 323. UK patent attorney firm HGF handles most of the EPO work for Philip Morris. UK firm Reddie & Grose is also involved with some of Philip Morris’ patents.

Jin Ooi

BAT retains Kirkland & Ellis

Once again, Kirkland & Ellis acted for BAT in the heat-not-burn cigarette proceedings in the UK, led by partners Jin Ooi and Nicola Dagg. In the UK, BAT was a new client for Kirkland at the commencement of proceedings in 2020. The firm has since represented the client in myriad proceedings against Philip Morris.

The firm is also helping coordinate the litigation globally, with patent boutique Vossius & Partner running the German case. Vossius and BAT have had good relations for many years.

Partners Thure Schubert and Kai Rüting, as well as patent attorney Elard Schenck zu Schweinsberg, initiated the first claims against Philip Morris in Germany in spring 2020. The team led for BAT in the 2022 proceedings in Düsseldorf.

UK patent attorney firms D Young & Co. and Venner Shipley handle most of the patent applications and opposition proceedings on behalf of BAT.

For Philip Morris
8 New Square (London): Andrew Lykiardopoulos
11 South Square (London): Tom Alkin
Powell Gilbert (London): Tim Whitfield, Peter Damerell, Alex Wilson (all partners); associates: Ben Rowlatt, Gabriella Simon

For BAT
Brick Court Chambers (London): Nicholas Saunders
11 South Square (London): Kathryn Pickard
Kirkland & Ellis (London): Nicola Dagg, Jin Ooi, Peter Pereira, William Jensen (all partners); associates: Nessa Khandaker, Andrew Marks
Venner Shipley (London): Phil Harrison (partner)

UK High Court, London
Richard Hacon (deputy presiding judge)