Reynolds ENDS Section 337 Investigation Concludes: Asserted Claims Invalid, No General Exclusion Order

In brief: On March 10, 2026, the U.S. International Trade Commission issued its final Commission Opinion in investigation 337-TA-1410, concluding a patent fight of nearly two years that had the vape industry's full attention. The Commission reversed the ALJ's Final Initial Determination (FID) and held that every claim Reynolds asserted — including claims 4 and 12, which the ALJ had found valid and infringed — is invalid as obvious. The investigation terminated with a finding of no violation, and the general exclusion order (GEO) the industry had most feared did not issue.

01 | Where the Case Stood

Our previous note, published in February 2026, covered the Commission's decision to review the ALJ's FID in part. The open questions were whether claims 4 and 12 would be held obvious over the combination of Kim and Pienemann, and whether the GEO and the 136% bond would ultimately take effect.

The answers are now in, and the Commission reached the conclusion most favorable to the industry:

• Claims 1, 4, and 12 are all invalid as obvious under § 103.
• The finding that Takeuchi does not anticipate claims 4 and 12 stands.
• The investigation terminated with a finding of no violation of Section 337.
• No general exclusion order, limited exclusion order, or cease and desist order issued.
• The 136% bond requirement does not apply.

02 | Why the Commission Reversed

2.1 The Core Error

In the FID, the ALJ concluded that respondents had failed to establish that the porous chip of the Kim patent satisfied the key limitation of claim 1 of the '202 patent — that the liquid aerosol-forming material be drawn into contact with the resistive heater by wicking (limitation 1[e]).

The ALJ's reasoning was that Kim does not expressly discuss wicking, that respondents' expert Dr. Dean testified too generally, and that the slider knob in the Kim device itself indicates that the liquid need not wick.

The Commission was explicit: that analytical approach is wrong.

2.2 Obviousness Does Not Require That the Prior Art Necessarily Disclose the Element

The ALJ's fundamental error was conflating the obviousness analysis with the standard for inherent anticipation. Inherency requires that an element be necessarily present in the prior art. The obviousness question is not whether Kim discusses wicking, but:

Would a person of ordinary skill in the art (POSA), given what Kim discloses, have been motivated to use a wicking material to make the porous chip?

The Commission answered yes, for the following reasons:

• Kim expressly requires that the porous chip absorb liquid into its pores and readily release it once vaporized.
• Wicking is a basic physical principle established since the mid-nineteenth century and universally known in the art.
• Without a wicking material, liquid at the far end of the chip would be unusable where the heater does not reach it — wasteful, given that Kim expressly contemplates the chip storing roughly two weeks' supply.
• Although Reynolds's expert argued that wicking is inconsistent with the slider knob, the Commission concluded that this only shows the two may be used together and complement one another, not that they are mutually exclusive.
• Commercial design constraints (heat resistance, taste, and so on) are not required by the claims and cannot affect the POSA's obviousness analysis.

2.3 Claim 4: The Aerosol Passes At Least Partially Through the Reservoir

The ALJ found that respondents' expert had misconstrued "the aerosol that is produced," which per limitation 1[f] is a mixture of liquid vapor and outside air rather than vaporized liquid alone. The Commission accepted that construction but concluded the ALJ had read Dr. Dean's testimony too narrowly.

The key is that claim 4 uses "at least partially through." Kim's porous chip is full of pores and interconnected structures, and vaporized liquid leaving the chip necessarily mixes with outside air entering those pores — mixing that occurs at least partially within the chip. The Commission found this not only obvious but difficult, if not unavoidable, to prevent.

2.4 Claim 12: The Heater Permits Airflow

The ALJ concluded that Kim's heating coil, to fit within the central channel of the porous chip, would have to be wound so tightly as to create creases and weld points that would block airflow. The Commission found that conclusion overlooked key facts:

• Kim expressly discloses the central channel, which is wide enough for the chip to move back and forth under the slider knob.
• Kim never requires that any portion be completely sealed.
• The coil's material, wire gauge, number of turns, diameter, and spacing from the chip — design variables well known in the art — can all be adjusted to permit some degree of airflow.
• Even Reynolds's expert Mr. Alarcon acknowledged that the design parameters Dr. Dean identified were known in the art.

The Commission noted that the governing standard is KSR: combining known elements according to their known functions to yield predictable results is generally obvious. KSR Int'l Co. v. Teleflex, Inc., 550 U.S. 398 (2007).

03 | Takeuchi Anticipation: No Anticipation, Affirmed

On whether Takeuchi anticipates claims 4 and 12, the Commission affirmed the ALJ's finding of no anticipation, while adding an important analysis.

Respondents argued that during the replenishment phase of the Takeuchi device, as liquid evaporates from the reservoir tube and creates a void, outside air briefly flows into the tube, passes through the annular heater (satisfying claim 12), and mixes with residual vapor (satisfying claim 4).

The Commission responded that even if such a phenomenon were theoretically possible, respondents' expert offered no calculation, simulation, or data establishing that it actually occurs. Takeuchi's capillary inner diameter falls within an optimal range of 0.1–0.8 mm, where capillary action is very strong and liquid can refill a void within milliseconds — leaving no time window for outside air to enter.

A trace amount can support anticipation (as in SmithKline), but only where that trace is the necessary result of the prior art product's operation. A trace that is merely possible, or probable, does not meet the standard of proof for anticipation.

That is a substantive addition to the FID, clarifying the boundaries of de minimis anticipation and of significant reference value for comparable cases.

04 | Procedure: Obviousness Was Not Waived

Reynolds raised a procedural argument: that respondents before the ALJ had largely argued that Kim disclosed the relevant elements rather than genuinely asserting obviousness, and had therefore waived it.

The Commission disagreed, for three reasons:

• Respondents and Dr. Dean asserted obviousness expressly throughout the proceeding.
• The ALJ's own summary regarding claim 12 acknowledged that respondents had made an obviousness argument, contradicting footnote 105 of the FID.
• Respondents' theory did not require modifying Kim; it asserted that Kim's known elements were obvious within a POSA's technical knowledge — a legitimate § 103 analysis.

That treatment matters in practice: in a Section 337 investigation, obviousness and inherent disclosure arguments may be advanced in parallel. They address different aspects of a continuum and should not be treated as severed.

05 | What the Outcome Means for the Industry

5.1 The GEO Threat Is Fully Lifted

This is the most immediate effect. In the RD, the ALJ had recommended a GEO covering all disposable atomizer products infringing claims 4 and 12, regardless of whether the importer was a respondent. Had it issued, nearly all Chinese-manufactured disposable vape products would have faced an import bar.

Because the Commission held every asserted claim invalid, no GEO could issue, and the industry retains market access. In addition, the '202 patent itself expires on October 18, 2026 — so even had it been upheld, little of its term remained.

5.2 Lessons for Patent Portfolio Strategy

The case exposes a strategic weakness: Reynolds's position rested entirely on a handful of claims of the '202 patent, and the core independent claim 1 was already invalid as anticipated at the FID stage. The infringement case was therefore structurally fragile; once the Commission also reversed on obviousness, Reynolds was left with nothing.

That is a precedent worth attention for complainants who mount a Section 337 campaign on a single patent. Portfolio depth and breadth matter. A Section 337 action built on one patent and a limited set of claims carries substantial risk where respondents have the resources to mount an effective validity challenge.

5.3 The Common-Sense Dimension of Obviousness

The Commission repeatedly invoked the principle established in KSR: a POSA's logic, judgment, and common sense are part of the obviousness analysis, and the inquiry should not be confined to the literal text of the prior art. That position favors accused infringers, meaning a validity defense may draw on broader technical background knowledge without locating a word-for-word disclosure for every element.

5.4 The Absence of Secondary Considerations

Notably, Reynolds never offered objective evidence of non-obviousness — commercial success, unexpected results, industry praise — at any point in the proceeding, and the Commission expressly noted it. In future Section 337 cases, a patentee facing an obviousness defense should prepare and submit such evidence systematically.

06 | What Became of the Lashify Standard Here

Our previous note described Lashify's revision of the domestic industry standard in detail. Here, the ALJ applied the new standard and found Reynolds's sales network and quality control investment (including its FDA PMTA expenditures) sufficient to satisfy the economic prong.

On review, the Commission took a pragmatic position: with every asserted claim invalid, whether the economic prong was satisfied no longer mattered, and the Commission took no position. The technical prong — whether Reynolds's products practice a valid claim of the '202 patent — was affirmed.

Viewed more broadly, the Lashify standard did operate here, helping Reynolds clear the domestic industry threshold and carry the case through to the merits. Its effect on future Section 337 investigations continues: a lower threshold for complainants to bring an action, and correspondingly less room for respondents to contest domestic industry.

07 | Practical Implications for Pending and Potential Section 337 Cases

7.1 The Value of a Validity Challenge

The clearest lesson here is that a systematic challenge to validity can change the trajectory of a Section 337 investigation entirely. In Section 337 practice, invalidity is a complete defense: if the patent is invalid, there is no violation regardless of infringement. Respondents' willingness to invest in a fully expert-supported validity case ultimately reversed the entire matter.

7.2 Defaulted Respondents and What Comes Next

Under the Commission's March 10, 2026 final opinion, the investigation terminated with no violation, and no exclusion order, cease and desist order, or bond requirement issued. That determination should apply to all respondents, including those in default, and there is no import bar risk at this stage. We suggest continuing to monitor through March 24, 2026 (the deadline for a petition for reconsideration) and May 10, 2026 (expiration of the appeal period), to confirm whether Reynolds initiates further proceedings.

08 | The Key Determinations Side by Side

09 | Closing: A Reversal Worth Recording

Investigation 337-TA-1410 ran nearly two years from filing to termination, passing through a denied TEO, an FID finding infringement, and a recommended GEO — each highly adverse to the industry — only to end with every asserted claim invalid and a finding of no violation.

That outcome was not accidental. It came from respondents' systematic preparation on validity and an accurate grasp of obviousness analysis under the KSR framework. The Commission expressly corrected the ALJ's conflation of obviousness with inherent anticipation, providing an important reference point for validity defenses in comparable cases.

For vape companies focused on the U.S. market, perhaps the most important message is this: facing a Section 337 investigation, appearing and preparing a thorough validity defense remains a viable path to reversing an unfavorable position.

This article addresses general legal questions only and does not constitute legal advice on any specific matter.