Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 1 of 23 PageID# 10606
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF VIRGINIA
`ALEXANDRIA DIVISION
`
`
`
`v.
`
`RAI STRATEGIC HOLDINGS, INC. and
`R.J. REYNOLDS VAPOR COMPANY,
`
`Plaintiffs and Counterclaim Defendants,
`
`
`
`ALTRIA CLIENT SERVICES LLC; PHILIP
`MORRIS USA INC.; and PHILIP MORRIS
`PRODUCTS S.A.,
`
`Defendants and Counterclaim Plaintiffs.
`
`
`
`Case No. 1:20-cv-00393-LO-TCB
`
`
`
`PLAINTIFFS’ OPPOSITION TO DEFENDANT PHILIP MORRIS PRODUCTS S.A.’S
`MOTION FOR LEAVE TO AMEND COUNTERCLAIMS TO ADD INJUNCTIVE RELIEF
`
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 2 of 23 PageID# 10607
`
`
`
`TABLE OF CONTENTS
`
`
`Page
`
`
`INTRODUCTION ......................................................................................................................... 1
`FACTUAL BACKGROUND ........................................................................................................ 4
`A.
`In June 2020, PMP Asserted A Counterclaim For Money Damages
`Relating To Alleged Infringement Of Its Patents, And Fact And Expert
`Discovery Proceeded On That Basis...................................................................... 4
`In Parallel Proceedings Before The ITC, PMP And Its Experts Argued
`That An Injunction Excluding Alternatives To Combustible Cigarettes
`Should Not Be Granted, As They Said It Is Manifestly Against The Public
`Interest.................................................................................................................... 5
`Just Minutes After The ITC Proceedings Were Closed, PMP Notified
`Reynolds Of Its Intention To Seek Leave To Add A Claim For Injunctive
`Relief In This Case, Seeking To Bar Reynolds’s Products From The
`Market .................................................................................................................... 7
`LEGAL STANDARD .................................................................................................................... 7
`ARGUMENT ................................................................................................................................. 8
`I.
`REYNOLDS WOULD BE UNDULY PREJUDICED IF PMP IS ALLOWED TO
`ADD A CLAIM OF INJUNCTIVE RELIEF AT THIS LATE STAGE ........................... 8
`A.
`PMP’s Belated Request For Permanent Injunctive Relief Would Alter And
`Expand The Scope Of The Case ............................................................................ 8
`If PMP Is Permitted To Seek Injunctive Relief, Reynolds Would Need
`Fact And Expert Discovery That Cannot Be Accomplished In The Time
`Remaining Under The Current Schedule ............................................................. 11
`PMP OFFERS NO EXCUSE FOR ITS EIGHT-MONTH DELAY IN SEEKING
`TO ADD INJUNCTIVE RELIEF, AND THERE IS NONE .......................................... 15
`CONCLUSION ............................................................................................................................ 17
`
`
`B.
`
`C.
`
`B.
`
`II.
`
`
`
`
`
`-i-
`
`
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 3 of 23 PageID# 10608
`
`
`
`
`
`CASES
`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Amgen, Inc. v. Sanofi,
`872 F.3d 1367 (Fed. Cir. 2017) ............................................................................................................ 12
`
`Atlantic Bulk Carrier Corp. v. Milan Express Co.,
`No. 3:10CV103, 2010 WL 2929612 (E.D. Va. July 23, 2010) (Lauck, J.) .......................................... 10
`
`BASF Plant Sci., LP v. Commonwealth Sci. & Indus. Rsch. Org.,
`No. 2:17-CV-503-HCM, 2019 WL 8108116 (E.D. Va. Dec. 20, 2019) (Morgan, J.) ................... 11, 12
`
`Bergano v. City of Va. Beach,
`No. 2:15CV520, 2016 WL 4435330 (E.D. Va. Aug. 17, 2016) ............................................... 3, 4, 8, 15
`
`Davis v. Piper Aircraft Corp.,
`615 F.2d 606 (4th Cir. 1980) ................................................................................................................ 16
`
`Deasy v. Hill,
`833 F.2d 38 (4th Cir. 1987) .............................................................................................................. 9, 16
`
`eBay Inc. v. MercExchange, L.L.C.,
`547 U.S. 388 (2006) ...................................................................................................................... passim
`
`Equal Rights Ctr. v. Niles Bolton Assocs.,
`602 F.3d 597 (4th Cir. 2010) .................................................................................................................. 9
`
`Foman v. Davis,
`371 U.S. 178 (1962) ............................................................................................................................... 3
`
`Forstmann v. Culp,
`114 F.R.D. 83 (M.D.N.C. 1987) ........................................................................................................... 16
`
`Grannis v. Ordean,
`234 U.S. 385 (1914) ............................................................................................................................. 12
`
`Johnson v. Oroweat Foods Co.,
`785 F.2d 503 (4th Cir. 1986) .................................................................................................................. 9
`
`Laber v. Harvey,
`438 F.3d 404 (4th Cir. 2006) ................................................................................................................ 10
`
`Mayfield v. Nat’l Ass’n for Stock Car Auto Racing, Inc.,
`674 F.3d 369 (4th Cir. 2012) .................................................................................................................. 9
`
`
`
`ii
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 4 of 23 PageID# 10609
`
`TABLE OF AUTHORITIES
`(continued)
`
`
`
`Page(s)
`
`
`MercExchange, L.L.C. v. eBay, Inc.,
`467 F. Supp. 2d 608 (E.D. Va. 2006) (Friedman, J.) ...................................................................... 11, 12
`
`Monsanto Co. v. Geertson Seed Farms,
`561 U.S. 139 (2010) ............................................................................................................................... 2
`
`Mullane v. Central Hanover Bank & Trust Co.,
`339 U.S. 306 (1950) ............................................................................................................................. 12
`
`Nat’l Bank of Washington v. Pearson,
`863 F.2d 322 (4th Cir. 1988) ............................................................................................................ 7, 16
`
`Nelson v. Adams USA, Inc.,
`529 U.S. 460 (2000) ............................................................................................................................. 12
`
`Nelson-Ricks Cheese Co. v. Lakeview Cheese Co., LLC,
`No. 4:16-cv-00427-DCN, 2017 WL 4076101 (D. Idaho Sept. 14, 2017) ............................................ 15
`
`Sandcrest Outpatient Servs. v. Cumberland Cty. Hosp. Sys.,
`853 F.2d 1139 (4th Cir. 1988) ................................................................................................................ 7
`
`Sandoval v. Starwest Servs., LLC,
`No. 1:17-cv-01053, 2018 WL 2426269 (E.D. Va. Feb. 16, 2018) (Trenga, J.) ............................... 8, 16
`
`OTHER AUTHORITIES
`
`Fed. R. Civ. P. 15 ................................................................................................................................. passim
`
`
`
`iii
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 5 of 23 PageID# 10610
`
`
`
`
`
`INTRODUCTION
`
`On June 29, 2020, Defendant Phillip Morris Products, S.A. (“PMP”) lodged counterclaims
`
`against Plaintiff R.J. Reynolds Vapor Company (“Reynolds”), asserting infringement of three
`
`patents. (Dkt. 40 at ¶¶ 17-46.) PMP was clear in that pleading that the only relief it sought to
`
`redress Reynolds’s alleged infringement of these patents was money damages. (Id. at 44.) PMP
`
`made no mention of injunctive relief in those counterclaims, or at any time in the ensuing eight
`
`months, even as the Parties pursued extensive fact discovery to prepare this matter for trial. PMP
`
`provided no initial disclosures to indicate that it would seek injunctive relief, nor did PMP identify
`
`any witness(es) who could support such a claim. In addition, the case was stayed for weeks, during
`
`which time PMP easily could have reached out to preview this issue, and to work out a fair
`
`adjustment to the schedule that the Parties could propose in order to accommodate any discovery
`
`that Reynolds would need. Instead, PMP said nothing. Indeed, even after the stay was lifted and
`
`PMP submitted its opening expert reports relating to these counterclaim patents on February 24,
`
`2021, PMP still said not one word about injunctive relief. It was not until the evening of Friday,
`
`February 26, that PMP first gave notice of its intention “to file a motion for leave to amend its
`
`counterclaims to add the remedy of injunctive relief,” seeking to exclude from the market at least
`
`one, and perhaps even all, of Reynolds’s widely-used VUSE vaping products. (Ex. 1, Feb. 26,
`
`2021, J. Koh e-mail.) This motion should be denied, for numerous reasons.
`
`First, Federal Rule of Civil Procedure 15 does not permit amendment where it would cause
`
`prejudice to the non-moving party. And that is absolutely the case here. Document production in
`
`this matter is substantially complete; opening expert reports already have been exchanged;
`
`discovery is set to close April 12; and the final pretrial conference will take place before Judge
`
`O’Grady on April 16 —preceded by the submission of witness and exhibit lists. In PMP’s own
`
`
`
`
`
`
`
`
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 6 of 23 PageID# 10611
`
`
`words, this case is “nearly trial-ready.” (Dkt. 451 at 3, 7, 10.) Although PMP’s motion treats the
`
`addition of a claim for injunctive relief at this late stage as a clerical matter, it is far from that. As
`
`the Supreme Court has made clear, “[a]n injunction is a drastic and extraordinary remedy, which
`
`should not be granted as a matter of course.” Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139
`
`(2010). To fairly meet PMP’s threat of an injunction to exclude its products from the market,
`
`Reynolds would need to conduct full discovery into the bases for PMP’s claim—to draw out PMP’s
`
`contentions; to identify and depose whatever witnesses PMP might identify who have evidence
`
`relevant to the claim of injunctive relief; to request, receive, and review PMP’s documents bearing
`
`on factors like irreparable harm, adequacy of money damages, balance of the equities, and public
`
`interest, see eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006); to marshal its own
`
`documents and witnesses; and, ultimately, to present expert and/or other testimony around these
`
`new issues.
`
`PMP knows full well the massive scope of this undertaking. For example, as part of the
`
`parallel proceedings before the International Trade Commission (“ITC”), in which Reynolds seeks
`
`an exclusion order against the infringing IQOS products, PMP – represented by the same counsel
`
`as in this case – offered voluminous testimony (including four expert witnesses) to challenge the
`
`propriety of Reynolds’s requested injunctive relief. If PMP were allowed to add a claim for
`
`injunctive relief into this case, Reynolds would need the same fair opportunity to meet and oppose
`
`that claim. And Reynolds has done none of that work to date, because PMP elected to forego any
`
`claim for injunctive relief. If that claim were now added to the case, Reynolds would need to start
`
`that discovery from scratch, and could not possibly accomplish it in the time remaining. Absent a
`
`significant adjustment to the fact and expert schedule in this case—which PMP flatly opposes—
`
`the allowance of a claim for injunctive relief at this late stage of the case would inexorably prejudice
`
`Reynolds.
`
`
`
`2
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 7 of 23 PageID# 10612
`
`
`
`Second, amendment under Rule 15 should not be “freely give[n]” when there is “undue
`
`delay, bad faith or dilatory motive on the part of the movant.” Bergano v. City of Va. Beach, No.
`
`2:15CV520, 2016 WL 4435330, at *14 (E.D. Va. Aug. 17, 2016) (citing Foman v. Davis, 371 U.S.
`
`178, 182 (1962)). There is no question that PMP’s delay in seeking to add a claim for injunctive
`
`relief in this case is undue, as it comes eight months after its counterclaims were made and just
`
`weeks before the final pretrial conference. That is not at all consistent with the Court’s Scheduling
`
`Order, which requires that “[a]ny motion to amend the pleadings or to join a party must be made
`
`as soon as possible after counsel or the party becomes aware of the grounds for the motion.” (Dkt.
`
`99 at 3.) Nor is there any excuse for the delay. PMP does not offer in its motion even one single
`
`fact bearing on the propriety of injunctive relief that is any different today than it was in June 2020,
`
`when it first lodged its counterclaims.
`
`The reason why PMP waited to do this is, instead, purely strategic. In the parallel ITC
`
`proceeding, PMP fought tooth and nail against injunctive relief, urging that any injunction that
`
`would take away alternatives to combustible cigarettes would be against the public interest. Of
`
`course, had PMP been pursuing an injunction in this case at the same time, it would have undercut
`
`its arguments to the ITC, as PMP would have to prove the opposite in this case: that a permanent
`
`injunction excluding combustible cigarette alternatives (here, Reynolds’s vaping products) actually
`
`serves the public interest. So, to avoid this risk, PMP waited until the ITC trial was completed.
`
`Then, ten minutes after the Parties filed their final ITC post-hearing briefs, closing the record in
`
`those proceedings, PMP launched this belated effort to add injunctive relief to this case. Having
`
`made the strategic decision to hold injunctive relief out of this case for months, to avoid the risk of
`
`taking a position inconsistent with its arguments in the ITC, PMP ought not be allowed to change
`
`course now, particularly at the expense of Reynolds.
`
`
`
`
`
`3
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 8 of 23 PageID# 10613
`
`
`
`FACTUAL BACKGROUND
`
`A.
`
`In June 2020, PMP Asserted A Counterclaim For Money Damages Relating
`To Alleged Infringement Of Its Patents, And Fact And Expert Discovery
`Proceeded On That Basis.
`
`This case began on April 9, 2020, when Reynolds sued for infringement of its asserted
`
`patents, seeking both money damages and injunctive relief. (Dkt. 1 at 20-22.) On June 29, 2020,
`
`PMP filed counterclaims, asserting infringement by Reynolds of three U.S. patents owned by
`
`PMP—Nos. 9,814,265; 10,555,556; and 10,104,911. (Dkt. 40 at ¶¶ 17-46.) Unlike Reynolds, PMP
`
`did not assert any claim for injunctive relief, and instead requested only money damages. (Id. at
`
`44.)
`
`Discovery proceeded consistent with the claims and counterclaims as asserted. Reynolds
`
`sought extensive discovery around the issues of infringement and validity of PMP’s counterclaim
`
`patents, and also PMP’s claim for money damages. But it did not pursue any discovery related
`
`specifically to the factors bearing on injunctive relief. For its part, PMP did seek discovery relevant
`
`to Reynolds’s timely filed claim for injunctive relief, including propounding a broad interrogatory
`
`seeking Reynolds’s “complete factual and legal basis” for its claim. (Ex. 2, Defendants’ First Set
`
`of Interrogatories (No. 8), at 11.) In October 2020, after months of discovery, PMP sought and
`
`was granted leave to amend its counterclaims. (See Dkts. 115, 179.) Once again, PMP made no
`
`mention of injunctive relief.
`
`By October 23, 2020, the Parties had substantially completed their document productions
`
`in this case. (Dkt. 97 at 6; Dkt. 99 at 1.) Then, on December 7, 2020, the Court ordered that the
`
`case be held in abeyance pending the Patent Trial and Appeal Board’s review of two of Reynolds’s
`
`patents. (Dkt. 432.) At the Court’s direction, the Parties continued during the stay to answer
`
`discovery that had already been propounded and to produce documents. (Dkt. 444, Motions
`
`Hearing Tr., at 9:12-18 (“I don’t expect you all to just do nothing, stop production that’s already in
`
`
`
`4
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 9 of 23 PageID# 10614
`
`
`the process of going on. I want you to … finish that production and finish answering any discovery
`
`that may be out there … But I want you to produce everything.”).) At no time during the weeks
`
`that this matter was stayed did PMP ever inform Reynolds or the Court of its intention to seek leave
`
`to add a claim of injunctive relief to this case.
`
`On February 16, 2021, the Court granted Defendants’ motion to lift the stay as to
`
`Defendants’ counterclaims. (Dkt. 456.) Consistent with the Court’s instructions at the
`
`December 4, 2020 hearing (Dkt. 444 at 10:7-12), the Parties conferred about the schedule.
`
`Reynolds inquired whether Defendants were “amenable to pushing the dates out a little bit, at a
`
`minimum the [deadlines for] Opening and Responsive Expert Reports in order to give the experts
`
`a little more time to re-engage,” as several of Reynolds’s experts who are university professors,
`
`who were “very busy with the new semester and the accompanying COVID issues on campus.”
`
`(Ex. 3 at 3, Feb. 17, 2021, W. Devitt e-mail.) On February 17, Defendants informed Reynolds that
`
`they opposed “pushing the dates at all,” and ultimately agreed to just two additional days for service
`
`of each round of expert reports. (Id. at 1 Feb. 17, 2021, M. Grant e-mail.) During these negotiations
`
`regarding the schedule, which occurred before the Parties had filed their final ITC post-hearing
`
`briefs, Defendants never mentioned PMP’s intention to move for leave to add a claim for injunctive
`
`relief within the next two weeks. Not knowing that this was PMP’s plan, Reynolds agreed to the
`
`schedule with this modest two-day extension, and it was presented to the Court (again, with no
`
`disclosure by PMP that it intended to seek leave to add a claim for injunctive relief), and entered
`
`by the Court on February 19. (Dkt. 461.)
`
`B.
`
`In Parallel Proceedings Before The ITC, PMP And Its Experts Argued That
`An Injunction Excluding Alternatives To Combustible Cigarettes Should Not
`Be Granted, As They Said It Is Manifestly Against The Public Interest.
`
`The same day that this case was filed, Reynolds filed an ITC complaint against Defendants
`
`(Inv. No. 337-TA-1199), asserting that Defendants’ IQOS products infringe several of Reynolds’s
`
`
`
`5
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 10 of 23 PageID# 10615
`
`
`patents and seeking an exclusion order barring Defendants from importing those products into the
`
`United States. From the very beginning of the ITC investigation, Defendants (including PMP)
`
`urged the ITC to find that the injunctive remedy Reynolds sought should be denied on public
`
`interest grounds. Indeed, in its pre-investigation public interest statement, PMP claimed that
`
`“implementation of the remedy requested by Complainants would have impermissible, deleterious
`
`effects on the public interest.” (Ex. 4 at 1 (Certain Tobacco Heating Articles & Components
`
`Thereof, Inv. No. 337-TA-1199, Philip Morris Products SA’s Comments to Complainants’ Public
`
`Interest Statement at 1 (U.S.I.T.C. Apr. 23, 2020)).)
`
`As part of the ITC proceedings, the Parties engaged in extensive discovery relating to the
`
`question of whether the public interest would be negatively impacted if Defendants’ IQOS products
`
`were excluded from the U.S. market. The Parties exchanged hundreds of pages of interrogatory
`
`responses on this issue. In addition, the Parties presented opinions and testimony from seven
`
`experts in a variety of disciplines. PMP’s experts were Dr. Brad Rodu (public health), Dr. Stacy
`
`Benson (public health), Ms. Stacey Ehrlich (FDA regulations), and Dr. Jonathan Arnold
`
`(economics). Reynolds’s experts were Dr. Edward Murrelle (public health), Mr. David Clissold
`
`(FDA), and Dr. Nisha Mody (economics). The Parties exchanged ten expert reports, and deposed
`
`the experts.
`
`From January 25, 2021 through February 1, 2021, the ITC held an evidentiary hearing at
`
`which both sides presented live testimony and other evidence. As they had done all along,
`
`Defendants (including PMP) maintained at the ITC hearing that an injunction excluding their IQOS
`
`products, which provide alternatives to combustible cigarettes, from the market would be
`
`deleterious to the public health, and that these public health concerns should override Reynolds’s
`
`right to enforce its patents. The above experts testified at trial for approximately 10 ½ hours, or
`
`nearly two full trial days. After the trial, the Parties and the Commission Investigative Staff filed
`
`
`
`6
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 11 of 23 PageID# 10616
`
`
`their opening and responsive post-trial briefs, devoting more than 130 pages to the issue of public
`
`interest. For their part, Defendants asserted that “the serious impact that any remedial orders would
`
`have on the public interest—specifically, public health and welfare—requires that the Commission
`
`take the rare step of forgoing issuance of such remedies,” and they predicted that the requested
`
`injunction would have “dire health consequences.” (Ex. 5 at 2 (Certain Tobacco Heating Articles
`
`and Components Thereof, Inv. No. 337-TA-1199, Respondents’ Post-Hearing Initial Brief (Public)
`
`at 2 (U.S.I.T.C. Feb. 22, 2021)); Ex. 6 at 4 (Certain Tobacco Heating Articles and Components
`
`Thereof, Inv. No. 337-TA-1199, Respondents’ Post-Hearing Responsive Brief (Public) at 4
`
`(U.S.I.T.C. Mar. 5, 2021)).) Reynolds filed its final ITC brief at 4:53 pm ET on February 26,
`
`20201, and Defendants filed their final ITC brief at 4:22 p.m. ET on that same day, closing the
`
`briefing. (Ex. 7, EDIS Notice of Filing; Ex. 8, EDIS Notice of Filing.)
`
`C.
`
`Just Minutes After The ITC Proceedings Were Closed, PMP Notified
`Reynolds Of Its Intention To Seek Leave To Add A Claim For Injunctive
`Relief In This Case, Seeking To Bar Reynolds’s Products From The Market.
`
`A mere ten minutes later, at 5:03 p.m. ET on February 26, Defendants’ counsel sent an
`
`e-mail informing Reynolds that PMP “intends to file a motion for leave to amend its counterclaims
`
`to add the remedy of injunctive relief.” (Ex. 1, Feb. 26, 2021, J. Koh e-mail.) By waiting to spring
`
`this new claim until after Reynolds had filed its last brief in the ITC, PMP ensured that Reynolds
`
`could not tell the Administrate Law Judge in that brief that PMP was moving for leave to seek an
`
`injunction in this case, a position directly contrary to its positions in the ITC.
`
`LEGAL STANDARD
`
`Under Federal Rule of Civil Procedure 15(a)(2), a party may amend its pleading only with
`
`the opposing party’s written consent or the court’s leave. “[T]he decision whether to grant a party
`
`leave to amend its pleading rests within the sound discretion of the district court.” Nat’l Bank of
`
`Washington v. Pearson, 863 F.2d 322, 327 (4th Cir. 1988) (citing Sandcrest Outpatient Servs. v.
`
`
`
`7
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 12 of 23 PageID# 10617
`
`
`Cumberland Cty. Hosp. Sys., 853 F.2d 1139, 1148 (4th Cir. 1988)). But leave to amend should be
`
`denied where, as here, there is “undue delay, bad faith or dilatory motive on the part of the movant,
`
`repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the
`
`opposing party by virtue of allowance of the amendment, or futility of amendment.” Bergano,
`
`2016 WL 4435330, at *14; see also Sandoval v. Starwest Servs., LLC, No. 1:17-cv-01053, 2018
`
`WL 2426269 (E.D. Va. Feb. 16, 2018) (Trenga, J.) (affirming this Court’s denial of motion for
`
`leave to amend the pleadings where the request came shortly before the close of fact discovery and
`
`the final pretrial conference, and where the record showed that the movant knew or should have
`
`known of the bases to add the claim earlier in the case).
`
`ARGUMENT
`
`I.
`
`REYNOLDS WOULD BE UNDULY PREJUDICED IF PMP IS ALLOWED TO
`ADD A CLAIM OF INJUNCTIVE RELIEF AT THIS LATE STAGE
`
`A.
`
`PMP’s Belated Request For Permanent Injunctive Relief Would Alter And
`Expand The Scope Of The Case.
`
`There can be no doubt that PMP’s belated request for permanent injunctive relief would
`
`significantly alter the scope of this case. In the eight months since PMP first asserted its
`
`counterclaims, the Parties have proceeded as though the only relief at issue was money damages—
`
`because that is what PMP pled. To be sure, Reynolds has pursued extensive discovery regarding
`
`the issues of infringement and validity of PMP’s asserted counterclaim patents, and about the many
`
`defects in PMP’s bid for a monetary award. And the Parties have joined issue on these topics
`
`through opposing experts: pursuant to the Court’s schedule, the Parties served initial expert reports
`
`on February 24, 2021, and will serve rebuttal reports on March 24, 2021. But Reynolds has done
`
`no discovery at all, nor undertaken any expert analysis, regarding the specific factors that would
`
`guide this Court’s analysis of whether to grant injunctive relief that would exclude one or more of
`
`Reynolds’s products from the marketplace, namely whether PMP can establish:
`
`
`
`8
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 13 of 23 PageID# 10618
`
`
`
`(1) that it has suffered an irreparable injury; (2) that remedies available at law, such
`as monetary damages, are inadequate to compensate for that injury; (3) that,
`considering the balance of hardships between the plaintiff and defendant, a remedy
`in equity is warranted; and (4) that the public interest would not be disserved by a
`permanent injunction.
`
`eBay Inc., 547 U.S. at 391. Opposing a claim for injunctive relief is a different matter entirely from
`
`addressing monetary damages alone, a fact that PMP knows full well.
`
`In this situation, where a belated amendment would “change the nature of the litigation and,
`
`would therefore, prejudice” the non-movant, courts have routinely denied motions to amend.
`
`Mayfield v. Nat’l Ass’n for Stock Car Auto Racing, Inc., 674 F.3d 369, 380 (4th Cir. 2012). Indeed,
`
`the Fourth Circuit has “repeatedly affirmed denials of motions to amend which change the character
`
`of the litigation late in the proceedings.” Equal Rights Ctr. v. Niles Bolton Assocs., 602 F.3d 597,
`
`604 n.3 (4th Cir. 2010). For example, in Equal Rights, the Fourth Circuit upheld the district court’s
`
`denial of a motion for leave to amend that would have allowed an “eleventh hour change in
`
`litigation theory” that prejudiced the non-moving party, who would have sought different discovery
`
`specific to the new theory if it had known of the proposed amendment earlier. Id. at 603. The
`
`Fourth Circuit has also upheld a denial of a motion to amend that would have raised a new issue
`
`requiring expertise and proof “of an entirely different character than the proof which the defendant
`
`had been led to believe would be necessary.” Deasy v. Hill, 833 F.2d 38, 41-42 (4th Cir. 1987);
`
`see also Johnson v. Oroweat Foods Co., 785 F.2d 503, 510 (4th Cir. 1986) (“[P]rejudice can result
`
`where a proposed amendment raises a new legal theory that would require the gathering and
`
`analysis of facts not already considered by the opposing party . . . where the amendment is offered
`
`shortly before or during trial.”). That is just the case here. For the last eight months since PMP
`
`first asserted its counterclaims, the dispute over relief for any alleged infringement of PMP’s
`
`asserted patents has been focused exclusively on the sole relief PMP was requesting – monetary
`
`damages. Adding injunctive relief into the mix just weeks before the close of discovery and the
`
`
`
`9
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 14 of 23 PageID# 10619
`
`
`final pretrial conference would absolutely change the character of the dispute and the nature of the
`
`fact and expert proof to be developed.
`
`PMP relies on Atlantic Bulk Carrier Corp. v. Milan Express Co., No. 3:10CV103, 2010
`
`WL 2929612, at *4 (E.D. Va. July 23, 2010) (Lauck, J.), for the notion that amending to add “an
`
`additional new theory of recovery,” as opposed to a new substantive claim, is somehow never
`
`prejudicial. (Dkt. 464 at 4.) That is not the law. The Fourth Circuit authority upon which Atlantic
`
`Bulk Carrier relies makes clear that such an amendment is not prejudicial only “if it merely adds
`
`an additional theory of recovery to the facts already pled and is offered before any discovery has
`
`occurred.” Laber v. Harvey, 438 F.3d 404, 427 (4th Cir. 2006) (emphases added).1 Here, PMP’s
`
`belated request to add a claim for permanent injunctive relief fails on both counts. PMP’s complaint
`
`pleads issues of infringement and money damages, not injunctive relief, and its request to add this
`
`claim certainly did not come before discovery was underway. To the contrary, the Parties have
`
`been engaged for months on discovery and expert analysis relating to PMP’s counterclaim patents,
`
`but, at least as to the relief sought, those efforts have focused solely on money damages. What
`
`PMP asks now is precisely what the Laber court described as “[a] common example of a prejudicial
`
`amendment” because it “‘raises a new legal theory that would require the gathering and analysis of
`
`facts not already considered by the [defendant, and] is offered shortly before or during trial.’”
`
`Laber, 438 F.3d at 427 (emphasis added). On this basis alone, PMP’s motion should be denied.
`
`
`1 Amendment was permitted in Atlantic Bell Carrier to add a counterclaim for negligence, but in
`that case the non-movant conceded that the underlying facts for the counterclaim were similar to
`those underlying its own negligence claim, which was already in the case and subject to full
`discovery. 2010 WL 2929612, at *4-5. The facts here are dramatically different, and compel a
`different result.
`
`
`
`10
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 476 Filed 03/10/21 Page 15 of 23 PageID# 10620
`
`
`
`B.
`
`If PMP Is Permitted To Seek Injunctive Relief, Reynolds Would Need Fact
`And Expert Discovery That Cannot Be Accomplished In The Time
`Remaining Under The Current Schedule.
`
`The changes that PMP’s belated request to add a claim for injunctive relief would make to
`
`this case are further underscored when one considers the extent of fact and expert discovery that
`
`Reynolds would need in order to respond effectively to that request. Although PMP is correct that
`
`injunctive relief is available under the patent laws, the eBay case, which arose in this very District,
`
`makes clear that injunctive relief does not follow automatically from a finding that a patent is
`
`infringed and not invalid. Instead, PMP would be required to affirmatively prove that each of the
`
`four eBay factors is met. eBay Inc., 547 U.S. at 391. Not surprisingly, disputes around the grant
`
`of injunctive relief in patent cases are hard fought, fact-intensive, and often involve competing
`
`expert testimony. See, e.g., BASF Plant Sci., LP v. Commonwealth Sci. & Indus. Rsch. Org., No.
`
`2:17-CV-503-HCM, 2019 WL 8108116, at *17 (E.D. Va. Dec. 20, 2019) (Morgan, J.) (denying
`
`injunctive relief after considering, among other things, testimony from expert witnesses on the
`
`issues of irreparable harm, adequacy of legal remedies, and public interest). These matters require
`
`discovery. Indeed, when the eBay case was remanded from the Supreme Court with instructions
`
`to apply the four-factor test, Judge Friedman of this Court actually re-opened the schedule to permit
`
`approximately three months of additional discovery, including document requests and depositions,
`
`even though there had already been extensive discovery on the injunction issues in that matter
`
`(unlike here) before the appeal. See MercExchange, L.L.C. v. eBay, Inc., 467 F. Supp. 2d 608, 626-
`
`27 (E.D. Va. 2006) (Friedman, J.) The party seeking the injunction, MercExchange, objected
`
`because additional discovery would delay resolution on the merits, but this Court properly noted
`
`that MercExchange was the one moving for