Star Scientific Successful in Appeal of Patent Infringement Lawsuit Against RJ Reynolds...

Mon Aug 25, 2008 12:54pm EDT

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Star Scientific Successful in Appeal of Patent Infringement Lawsuit Against RJ Reynolds Tobacco

PETERSBURG, Va.--(Business Wire)--
Star Scientific, Inc. (NASDAQ:STSI) announced that the United
States Court of Appeals for the Federal Circuit issued its opinion
today on Star's appeal of rulings by the US District Court in its
patent infringement lawsuit against RJ Reynolds Tobacco Company, Inc.
(RJR). A three-judge panel ruled unanimously that the lower court's
ruling, that Star Scientific had engaged in inequitable conduct, was
"clearly erroneous", and also reversed the district court's grant of
summary judgment holding Star's patents indefinite. Based on those
rulings the Federal Circuit Court remanded the case for further
proceedings. The opinion can be accessed at the Federal Circuit
Court's website: http://www.cafc.uscourts.gov/dailylog.html.

   A bench trial was held in early February, 2005 on RJR's defense
claim of inequitable conduct. Shortly before that trial began, RJR was
permitted by the District Court to file summary judgment motions that
claimed that the patents were neither sufficiently definite nor was
the patent application entitled to a priority date. Two years later,
in January, 2007, the district court issued rulings that granted RJR's
summary judgment motions. Six months later, on June 26, 2007, the
district court ruled that Star committed inequitable conduct in the
prosecution of its patents. Star filed a notice of appeal with the US
Court of Appeals for the Federal Circuit the following day. Oral
arguments on the appeal were heard by the Federal Circuit Court on
March 7, 2008. As a result of Star's success in its appeal, the case
will be remanded to the US District Court of Maryland for further
proceedings. As the company has previously stated, Star believes it
ultimately will be successful before a jury at trial

   This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. The Company has tried, whenever possible, to identify these
forward-looking statements using words such as "anticipates",
"believes", "estimates", "expects", "plans", "intends" and similar
expressions. These statements reflect the Company's current beliefs
and are based upon information currently available to it. Accordingly,
such forward-looking statements involve known and unknown risks,
uncertainties and other factors which could cause the Company's actual
results, performance or achievements to differ materially from those
expressed in, or implied by, such statements. These risks,
uncertainties and contingencies include, without limitation, the
challenges inherent in new product development initiatives,
particularly in the smokeless tobacco area, the uncertainties inherent
in the progress of scientific research, the Company's ability to raise
additional capital in the future necessary to maintain its business,
potential disputes concerning the Company's intellectual property,
risks associated with litigation regarding such intellectual property,
potential delays in obtaining any necessary government approvals of
the Company's low-TSNA tobacco products, market acceptance of the
Company's new smokeless tobacco products, competition from companies
with greater resources than the Company, the Company's decision not to
join the Master Settlement Agreement ("MSA"), the effect of state
statutes adopted under the MSA, and the Company's dependence on key
employees and on its strategic relationships with Brown & Williamson
Tobacco Corporation in light of its combination with RJ Reynolds
Tobacco Company, Inc. The impact of potential litigation, if initiated
against or by individual states that have adopted the MSA, could be
materially adverse to the Company.

   See additional discussion under "Risk Factors" in the Company's
Annual Report on Form 10-K for the year ended December 31, 2007, as
filed with the SEC on March 17, 2008, and other factors detailed from
time to time in the Company's other filings with the SEC, available at
www.sec.gov. The Company undertakes no obligation to update or advise
upon any such forward-looking statements to reflect events or
circumstances after the date of this press release or to reflect the
occurrence of unanticipated events.

   About Star Scientific

   Star Scientific is a technology-oriented tobacco company with a
toxin reduction mission. It is engaged in the development of
dissolvable smokeless tobacco products that deliver fewer carcinogenic
toxins (principally tobacco specific nitrosamines, or TSNAs), through
the utilization of the innovative StarCured(R) tobacco curing
technology, and in sublicensing that technology to others. Star
Scientific has a Corporate and Sales Office in Petersburg, VA, an
Executive, Scientific & Regulatory Affairs office in Bethesda, MD, and
manufacturing and tobacco processing facilities in Chase City, VA and
in Petersburg, VA.

   See Star's website at: http://www.starscientific.com

Star Scientific, Inc.
Sara Troy Machir
Vice President, Communications & Investor Relations
301-654-8300
smachir@starscientific.com

Copyright Business Wire 2008
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