Case 1:20-cv-00393-LO-TCB Document 502 Filed 03/18/21 Page 1 of 12 PageID# 11367
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`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
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`REDACTED
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`PLAINTIFFS’ REPLY IN SUPPORT OF SECOND MOTION TO COMPEL
`PRODUCTION OF RESPONSIVE DOCUMENTS RELATED TO
`DEFENDANTS’ ’374 PATENT INFRINGEMENT COUNTERCLAIM
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`

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`Case 1:20-cv-00393-LO-TCB Document 502 Filed 03/18/21 Page 2 of 12 PageID# 11368
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`TABLE OF CONTENTS
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`TABLE OF AUTHORITIES ...................................................................................................... ii
`INTRODUCTION........................................................................................................................ 1
`ARGUMENT ................................................................................................................................ 2
`I.
`This Court Should Compel Defendants to Produce Responsive Documents ............ 2
`II.
`Reynolds’s Second Motion to Compel is Not a Motion for Reconsideration ............ 5
`III.
`Defendants Have Control Over Smart Chip and Minilogic ....................................... 6
`CONCLUSION ............................................................................................................................ 7
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`
`
`-i-
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`Case 1:20-cv-00393-LO-TCB Document 502 Filed 03/18/21 Page 3 of 12 PageID# 11369
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`
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`CASES
`
`TABLE OF AUTHORITIES
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`Page
`
`In re Norfolk S. Ry. Co.,
`756 F.3d 282 (4th Cir. 2014) .....................................................................................................5
`
`Navient Sols., LLC v. L. Offs. of Jeffrey Lohman, P.C.,
`No. 119CV461LMBTCB, 2020 WL 6379233 (E.D. Va. Sept. 4, 2020) ...................................5
`
`Susko v. City of Weirton,
`No. 5:09-cv-1, 2011 WL 98557 (N.D. W.Va. Jan. 12, 2011) ....................................................4
`
`Tensor L. P.C. v. Rubin,
`No. 2:18-CV-01490-SVW-SK, 2019 WL 3249595 (C.D. Cal. Apr. 10, 2019) ........................5
`
`
`
`ii
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`
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`INTRODUCTION
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`Nothing in Defendants’ 22-page opposition to Reynolds’s 11-page motion to compel
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`changes the fact that an order compelling Defendants to comply with their discovery obligations
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`with respect to the ’374 patent is necessary because Defendants have shown that, left to their own
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`devices, they will frustrate that discovery at every turn, intentionally or not. The sequence has
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`grown familiar: Defendants fail to produce requested documents, offer vague or contradictory
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`responses when Reynolds follows up, point to a belated production when Reynolds seeks the
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`Court’s assistance in obtaining Defendants’ compliance with the rules of litigation, and then claim
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`Reynolds’s motion is moot or meritless. That is exactly what Defendants did in December—
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`before a report from one of Defendant’s experts revealed that Defendants had not made a complete
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`production, despite the assurances of Defendants’ counsel in filings and statements to this Court.
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`And that is also what they argue now. Once bitten, twice shy: In light of Defendants’ pattern of
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`empty promises, the Court should not force Reynolds to take Defendants’ word that production is
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`now complete, no matter what happened before. Instead, the Court should compel Defendants to
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`live up to their obligations by conducting a complete investigation into the existence of responsive
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`documents and producing those documents before Reynolds is further prejudiced.1
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`1 Defendants claim that the parties were not at an impasse on these issues, but that is incorrect.
`Rather, when Reynolds pointed out the previously unproduced documents contained in
`Defendants’ expert reports and requested a full production, Defendants responded three days
`later—and an hour after the Friday motions deadline—with an assertion that Reynolds’s position
`was “wholly without basis.” (Dkt. No. 489, Ex. J.) The parties then met and conferred. Contrary
`to Defendants’ suggestion, Defendants never stated that they would make a further investigation
`and production, outside of a narrow category of documents concerning the first and last date on
`which Defendants bought a Smart Chip sensor. Id. Defendants’ latest change of heart confirms
`the need for an order compelling Defendants to comply with their discovery obligations.
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`

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`I.
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`ARGUMENT
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`THIS COURT SHOULD COMPEL DEFENDANTS TO PRODUCE RESPONSIVE
`DOCUMENTS
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`In light of Defendants’ past misstatements and incomplete productions, the Court should
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`compel Defendants to conduct a thorough investigation and produce any remaining documents
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`responsive to Reynolds’s discovery requests relating to the ‘374 patent—namely RFPs 278–288
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`and 293–294. Contrary to Defendants’ characterization, Reynolds’s motion is not limited to
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`nonmetallic components or a single RFP. (Defs.’ Resp. at 7.) Rather, those are simply examples
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`of a much larger problem—Defendants’ failure to comply with their discovery obligations with
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`respect to the ’374 patent absent a court order.
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`In November, Reynolds served detailed requests for production on Defendants. (Dkt. No.
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`489, Ex. A.) Those requests sought, among other things:
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`• “[a]ll Documents relating to the purchase or acquisition of any technical designs,
`specifications, manufacturing information, prototypes, intellectual property, or other
`technological
`information
`relating
`to pressure sensors
`from Smart Chip
`Microelectronic or Minilogic Device Corporation” (RFP No. 278);
`
`• “[a]ll Documents relating to pressure sensors, pressure sensor assemblies, or devices
`containing the same made, designed, purchased, or sold by Smart Chip Microelectronic
`or Minilogic Device Corporation prior to July 7, 2015” (RFP No. 279);
`
`•
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`technical documents relating to the design, development, operation, engineering,
`manufacture, specifications, test procedures or structure of any pressure sensor,
`capacitor diaphragm, source code, or digital controller “used in [Defendants’] MarkTen
`Products prior to July 7, 2015” (RFP Nos. 281–285);
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`• “[a]ll Documents concerning puff sensors made by Weifang Qinyi Electron Science &
`Technology Co., Ltd.” or “by Hangzhou Toll Microelectronic Co., Ltd., f/k/a
`Hangzhou Sungol Technology Co., Ltd., prior to July 7, 2015” (RFP No. 286–287);
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`• “[d]ocuments sufficient to show each puff sensor known to ACS or its affiliates and in
`public use or on sale prior to July 7, 2015” (RFP No. 288); “[a]ll Documents concerning
`the awareness of” the inventor, inventor’s attorneys, individuals associated with ACS,
`or any other individuals involved in the prosecution of the ’374 patent of puff sensors
`in public use or on sale prior to July 7, 2015” (RFP No. 293); and
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`2
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`• “[a]ll Documents concerning the Identification of prior art for disclosure to the U.S.
`Patent and Trademark Office in connection with the prosecution of the ’374 patent”
`(RFP No. 294).
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`(Dkt. No. 489, Ex. A, at 9–12). Defendants’ shifting responses to those requests forced Reynolds
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`to pursue its first motion to compel with this Court. (Dkt. No. 380.) In response, Defendants
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`produced dozens of additional documents and stated on the record that their production was
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`complete. But two and half months later, Defendants turned around and relied in expert reports
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`on additional documents that they had not previously produced. This is the problem—Defendants
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`produce documents when it suits them and their position in the case but not when requested by
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`Reynolds. Thus, Reynolds is forced to ask this Court to compel Defendants to produce the
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`remaining documents responsive to these specific requests.
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`Defendants claim that the newly produced documents were duplicative of ones they
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`produced before they assured the Court their production was complete. To be clear: the new
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`documents are not duplicates. Nor is their substance the same as the old documents. Compare
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`(Dkt. No. 489, Ex. H (produced February 24, 2021)) with (Ex. A (produced December 4, 2020).)
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`If that were so, Defendants’ expert, Mr. Meyer, could have simply relied on the old documents.
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`Instead, when describing Defendants’ pre-2015 purchases of puff sensors from Minilogic, he relied
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`solely on newly produced documents. What is more, the newly produced documents are, as far as
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`Reynolds can tell, the first and only documents that reveal the inner structure and materials of the
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`prior art Minilogic puff sensor—a key focus of Reynolds’s discovery requests. Defendants cannot
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`credibly claim that the old documents they point to are duplicative of the new ones.2
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`2 As Defendants themselves noted, the old documents were also written largely
` (Defs.’
`Resp., Ex. 2.) Reynolds’s requests for production explicitly sought “all responsive Documents in
`their original language and, if such original language is not English, these requests also seek all
`English-language translations that may exist for any such documents.” (Dkt. No. 489, Ex. A, at
`8.)
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`3
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`Contrary to Defendants’ characterizations, Reynolds’s request for the remainder of
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`Defendants’ responsive documents is not based on “conjecture” and “speculation” (Defs.’ Resp.
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`at 15-16), but rather on valid concerns raised by Defendants’ own actions. It is the three actions
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`described above—an assurance that production was complete followed by a later revelation of
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`previously unproduced responsive documents vital to Reynolds’s defense, with shifting and
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`unreliable assertions concerning discovery positions—that establish Reynolds’s “colorable basis
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`for its belief that relevant, responsive documents exist and are being improperly withheld.” (Defs.’
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`Response at 17 (quoting Susko v. City of Weirton, No. 5:09-cv-1, 2011 WL 98557, at *4 (N.D.
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`W.Va. Jan. 12, 2011)).
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`Simply put, Defendants’ own actions and words show that their production is still not
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`complete. Indeed, since Reynolds filed its second motion, Defendants and Smart Chip have
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`produced new documents, further demonstrating that production is not complete.3 As such,
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`Reynolds continues to be disadvantaged in its discovery related to the ’374 patent because
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`Defendants refuse to voluntarily and timely produce responsive documents except when it suits
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`them and their position in the case. Discovery closes in a few weeks, and Reynolds is scheduled
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`to depose the inventor of the ’374 patent, Mr. Liu, next week. Without this Court’s intervention,
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`Reynolds will be left to depose one of the most important witnesses in this case without the benefit
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`of a full production of the documents pertaining to the ‘374 patent, based on a thorough
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`investigation. Reynolds therefore asks that this Court compel Defendants to honor their discovery
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`obligations by immediately conducting a thorough investigation and producing any remaining
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`responsive documents in their possession or control or the possession or control of Smart Chip and
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`Minilogic.
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`3 Reynolds is currently reviewing the 500-page production made yesterday.
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`4
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`II.
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`REYNOLDS’S SECOND MOTION TO COMPEL IS NOT A MOTION FOR
`RECONSIDERATION
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`
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`Defendants mischaracterize Reynolds’s second motion as a motion for reconsideration.
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`The simple fact, which Defendants acknowledge, is that the Court denied the first motion as moot
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`in light of its decision to stay the proceedings and Defendants’ express assurances that their
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`production was complete. There is therefore nothing to reconsider: Denying a motion as moot
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`presupposes the issue can be reconsidered if and when it becomes not moot. See Tensor L. P.C. v.
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`Rubin, No. 2:18-CV-01490-SVW-SK, 2019 WL 3249595, at *2 n.1 (C.D. Cal. Apr. 10, 2019)
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`(rejecting argument that defendant was barred from brining second motion because first motion
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`was dismissed as moot and “[a] denial of a motion on mootness grounds necessarily means the
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`Court did not have the occasion to reach the merits of [the] motion”); cf. In re Norfolk S. Ry. Co.,
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`756 F.3d 282, 293 (4th Cir. 2014) (dismissal of motion to dismiss on mootness grounds has no
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`preclusive effect since court does not resolve merits of the issue).4 And that is exactly what
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`happened here, where the case is no longer stayed and Defendants’ expert reports revealed that
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`their production is not, as they had claimed, complete. In other words, Reynolds is not asking the
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`Court to reconsider anything because the Court did not consider the merits of Reynolds’s initial
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`motion in the first place.
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`Moreover, even if Reynolds’s motion could be characterized as a motion for
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`reconsideration, such a motion would be appropriate here because of “new evidence not available
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`earlier” that has come to light. Navient Sols., LLC v. L. Offs. of Jeffrey Lohman, P.C., No.
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`119CV461LMBTCB, 2020 WL 6379233, at *3 (E.D. Va. Sept. 4, 2020). That new evidence is
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`4 None of the cases that Defendants cite for the proposition that courts routinely deny
`motions to compel where they are “simply motions for reconsideration” (Defs.’ Resp. at 13)
`involved a prior motion that was denied as moot where the court did not reach the merits of the
`issue, as occurred in this case.
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`5
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`not just a “modest supplementation” of discovery documents (Defs.’ Resp. at 14); rather, the new
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`evidence consists of documents revealed in expert reports and elsewhere, which demonstrate that
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`Defendants’ past assurances were inaccurate—and which cast doubt on their current assurances
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`they have made complete production. In other words, one of the main bases for the Court’s
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`decision to deny Reynolds’s first motion as moot—that Defendants’ production was allegedly
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`complete—turned out to be untrue, a change in facts that certainly warrants reconsideration.
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`III. DEFENDANTS HAVE CONTROL OVER SMART CHIP AND MINILOGIC
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`Defendants do not dispute that they have control over Smart Chip, and their arguments
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`with respect to their control over Minilogic are unavailing. First, despite Defendants’ claims that
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`no authorized contractor agreement exists between Smart Chip and Minilogic, the fact remains
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`that the intellectual property purchase agreement labels
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` (Dkt. No. 489, Ex. L, ¶ 6.3.) Second, contrary
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`to Defendants’ past assertions that Smart Chip and Minilogic are
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`(Dkt. No. 406 at 2), Mr. Meyer, Defendants’ own expert, described Smart Chip as
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` (Ex. B, at 48 n.235.) Third, given Defendants’ undisputed
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`control over Smart Chip and Mr. Lam’s and Mr. Liu’s cooperation with Defendants to date, at a
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`minimum, Defendants should be requiring Mr. Lam and Mr. Liu to provide any and all insights to
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`Minilogic employees regarding the ’374 patent, and Smart Chip should be using any
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`
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` to obtain Minilogic’s compliance with Reynolds’s
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`requests. If Defendants can obtain the assistance of Minilogic’s former employees to support
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`Defendants’ case through SmartChip or otherwise, then Defendants can also use that cooperation
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`to assist their former employer in locating the documents that Reynolds has requested related to
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`the ’374 patent. This Court should compel Defendants to immediately conduct a thorough
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`6
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`investigation into and produce all responsive documents in possession of Smart Chip and
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`Minilogic, not just those that support their case.
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`CONCLUSION
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`For these reasons, Reynolds respectfully requests that the Court enter an order compelling
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`Defendants to immediately: (1) conduct a complete investigation for the existence of responsive
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`documents in Defendants’ possession or control and immediately produce those documents, and
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`(2) conduct a complete investigation for the existence of responsive documents in Smart Chip’s
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`and Minilogic’s possession or control and immediately produce those documents.
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`7
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`Case 1:20-cv-00393-LO-TCB Document 502 Filed 03/18/21 Page 11 of 12 PageID# 11377
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`Respectfully submitted,
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`
`
`
`
` /s/ David M. Maiorana
`David M. Maiorana (VA Bar No. 42334)
`Ryan B. McCrum
`JONES DAY
`901 Lakeside Ave.
`Cleveland, OH 44114
`Telephone: (216) 586-3939
`Facsimile: (216) 579-0212
`Email: dmaiorana@jonesday.com
`Email: rbmccrum@jonesday.com
`
`John J. Normile
`JONES DAY
`250 Vesey Street
`New York, NY 10281
`Telephone: (212) 326-3939
`Facsimile: (212) 755-7306
`Email: jjnormile@jonesday.com
`
`
`Alexis A. Smith
`JONES DAY
`555 South Flower Street
`Fiftieth Floor
`Los Angeles, CA 90071
`Telephone: (213) 243-2653
`Facsimile: (213) 243-2539
`Email: asmith@jonesday.com
`
`Charles B. Molster, III Va. Bar No. 23613
`THE LAW OFFICES OF
`CHARLES B. MOLSTER, III PLLC
`2141 Wisconsin Avenue, N.W. Suite M
`Washington, DC 20007
`Telephone: (703) 346-1505
`Email: cmolster@molsterlaw.com
`
`Counsel for Plaintiffs RAI Strategic Holdings,
`Inc. and R.J. Reynolds Vapor Company
`
`
`Dated: March 18, 2021
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`
`
`Stephanie E. Parker
`JONES DAY
`1420 Peachtree Street, N.E.
`Suite 800
`Atlanta, GA 30309
`Telephone: (404) 521-3939
`Facsimile: (404) 581-8330
`Email: separker@jonesday.com
`
`
`Anthony M. Insogna
`JONES DAY
`4655 Executive Drive
`Suite 1500
`San Diego, CA 92121
`Telephone: (858) 314-1200
`Facsimile: (844) 345-3178
`Email: aminsogna@jonesday.com
`
`William E. Devitt
`JONES DAY
`77 West Wacker
`Suite 3500
`Chicago, IL 60601
`Telephone: (312) 269-4240
`Facsimile: (312) 782-8585
`Email: wdevitt@jonesday.com
`
`Sanjiv P. Laud
`JONES DAY
`90 South Seventh Street
`Suite 4950
`Minneapolis, MN 55402
`Telephone: (612) 217-8800
`Facsimile: (844) 345-3178
`Email: slaud@jonesday.com
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`Case 1:20-cv-00393-LO-TCB Document 502 Filed 03/18/21 Page 12 of 12 PageID# 11378
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`CERTIFICATE OF SERVICE
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`I hereby certify that on this 18th day of March, 2021, a true and correct copy of the
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`foregoing was served using the Court’s CM/ECF system, with electronic notification of such filing
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`to all counsel of record.
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`
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`
`
`/s/ David M. Maiorana
`David M. Maiorana (VA Bar No. 42334)
`JONES DAY
`901 Lakeside Ave.
`Cleveland, OH 44114
`Telephone: (216) 586-3939
`Facsimile: (216) 579-0212
`Email: dmaiorana@jonesday.com
`
`Counsel for Plaintiffs RAI Strategic Holdings,
`Inc. and R.J. Reynolds Vapor Company
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