HCMC’s lawsuit with Philip Morris is all over the news, and has had a big impact on the former’s stock prices.
But what exactly happened?
This article digs deep into the patent infringement story.
Who Are HCMC And Philip Morris?
HCMC (short for Healthier Choices Management Corp.) is a company based in the US that sells alternative healthier lifestyle products for customers.
On the other hand, Philip Morris is a US-based company that sells Tobacco products worldwide, their most recognizable brand name is Marlboro; the company is often a part of the Big Tobacco.
HCMC Lawsuit With Philip Morris Case Background
More specifically, HCMC owns a fully-fledged grocery store known as Ada’s Natural Market, spanning 18000 sq.ft in Fort Myers, Florida.
It also owns the Paradise Health and Nutrition stores in greater Melbourne, Florida.
Apart from this, the company also owns 8 vape stores (going by the brand names – The Grab Bag, Vulcan Vape, Vapor Max and The Vape Store) spread across the south-east USA that sells vape, an alternative to conventional cigarettes.
These stores contain an enviable collection of e-liquids and vape hardware, that provides the consumers with their dose of nicotine without the tar and ash of conventional cigarettes.
Patent Of HCMC
The patent portfolio of HCMC is diverse – it owns the rights to manufacturing process for a specific nicotine imitation product as well as a vape technology.
One of the patents they own is for the Q-Cup, which is a small-sized quartz cup that can be filled by third-party or by the customers themselves with CBD or Cannabis (this depends from region to region, and can be purchased from a third-party itself).
The Q-Cup is inserted to the Q-Unit and this heats the cup without contact with the concentrate.
This overall, provides a compact and portable solution for customers who look for vape concentrates either for recreational or medical reasons.
HCMC Philip Morris Case
HCMC filed a patent infringement case against Philip Morris for their product – IQOS, which is a similar tobacco alternative product by Philip Morris.
In its defence, Philip Morris claims of course, that it has not infringe any patent and is already serving close to 14 million customers with the product, and they have been in the tobacco alternative space from a long time (with investments > $3B), and they claim that they have been extremely open about this side of the business as well as the IQOS product.
Status Of The HCMC Philip Morris Case
The case has been in the favour of Philip Morris and to appeal against that, HCMC had filed a Motion for Leave to Amend, which also got rejected.
As of 2022, HCMC is mulling to appeal with the counsel Cozen O’Connor.
Details Of HCMC Lawsuit With Philip Morris
Basically, HCMC is suing Philip Morris for patent infringement on as they call it “the 170 Patent” which refers to the patent HCMC has on electric pipes, delivery systems, heating coils, etc.
Allegedly PM uses their “170 technology” on the IQOS product in some way, shape and form.
Now, the more interesting piece was what HCMC is looking for in their judgement.
Take a look on below statements which taken1 from their legal submission to the Georgia Courts:
WHEREFORE, Healthier Choices respectfully requests the Court to enter judgment in its favor and grant the following relief:
a) Entry of judgment under 35 U.S.C. § 271(a) that Defendants and the manufacture, importation, offer for sale, sale, and/or use of Defendants’ IQOS® product have infringed at least one claim of the ’170 patent;
b) Entry of judgment under 35 U.S.C. § 271(b) that Defendants manufacture, importation, offer for sale, sale, and/or use of Defendants’ IQOS® product actively induces and/or contributes to the infringement of at least one claim of the ’170 patent;
c) Ordering Defendants to account and pay damages adequate to compensate Plaintiff for Defendants’ infringement of the ’170 patent, including pre-judgment and post-judgment interest and costs and supplement damages for any continuing post-verdict or post-judgment infringement;
d) Ordering an accounting for any infringing sales not presented at trial and an award by the Court of additional damages for any such infringing sales;
e) Awarding Healthier Choices its costs and expenses incurred in this Action;
f) Granting Healthier Choices such other and further equitable relief which may be requested and to which Healthier Choices is entitled; and
g) Granting such further relief as the Court deems appropriate.