Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 1 of 22 PageID# 12427
`
`UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF VIRGINIA
`ALEXANDRIA DIVISION
`
`
`RAI STRATEGIC HOLDINGS, INC. AND R.J.
`REYNOLDS VAPOR COMPANY
`
`
`Plaintiffs and
`Counterclaim Defendants,
`
`
`v.
`
`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
`
`
`
`
`
`
`
`
`COUNTERCLAIM PLAINTIFFS’ REPLY IN SUPPORT OF MOTION TO COMPEL
`REYNOLDS’ 30(b)(6) DEPOSITION ON TOPICS 28, 54, AND 78
`
`
`
`
`
`

`

`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 2 of 22 PageID# 12428
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`TABLE OF CONTENTS
`
`
`
`Page
`
`I.
`
`INTRODUCTION ...............................................................................................................1
`
`II.
`
`ARGUMENT .......................................................................................................................3
`
`A.
`
`B.
`
`C.
`
`D.
`
`Reynolds Must Designate A Corporate Witness For Topic 28 (As It
`Relates To The
`)...........................................3
`Reynolds Must Make Mr. Gilley Available For A One-Hour Deposition
`On His Conversation With Dr. Sullivan ..................................................................8
`Reynolds Must Designate A Corporate Witness For Topic 54 (Non-
`Infringing Alternatives For The ’556 Patent) ........................................................11
`Reynolds Must Designate A Corporate Witness For Topic 78..............................12
`
`III.
`
`CONCLUSION ..................................................................................................................17
`
`
`
`i
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 3 of 22 PageID# 12429
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`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Cases
`
`Clear with Computers, LLC v. Bergdorf Goodman, Inc.,
`753 F. Supp. 2d 662 (E.D. Tex. 2010) .......................................................................................7
`
`EEOC v. M&T Bank,
`No. 16-cv-3180, 2018 WL 10807712 (D. Md. Jan. 9, 2018)...................................................15
`
`Genentech, Inc. v. Trustees of Univ. of Pa.,
`No. 10-cv-2037, 2011 WL 7074208 (N.D. Cal. June 10, 2011) ..............................................10
`
`Kajeet, Inc. v. Qustodio, LLC,
`No. 18-cv-1519, 2019 WL 8060078 (C.D. Cal. Oct. 22, 2019) ............................................6, 7
`
`In re MSTG, Inc.,
`675 F.3d 1337 (Fed. Cir. 2012)..............................................................................................6, 7
`
`Oracle Am., Inc. v. Google, Inc.,
`No. 10-cv-3561, 2011 WL 13390136 (N.D. Cal. Nov. 14, 2011) ...........................................10
`
`Sanofi-Aventis U.S. v. Genentech, Inc.,
`No. 15-cv-5685, 2016 WL 7444676 (C.D. Cal. Mar. 30, 2016)................................................4
`
`SEC v. Southridge Capital Mgmt., LLC,
`No. 10-cv-1685, 2013 U.S. Dist. LEXIS 64066 (D. Conn. May 6, 2013) ...............................16
`
`Stout v. Wolff Shoe Co.,
`No. 04-cv-23231, 2007 WL 1034998 (D.S.C. Mar. 31, 2007) ................................................15
`
`
`
`ii
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 4 of 22 PageID# 12430
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`I.
`
`INTRODUCTION
`
`Reynolds’ Opposition confirms that the testimony sought is relevant, and that the Court
`
`should compel Reynolds to provide witnesses on Topics 28, 54, and 78, as well as the recent private
`
`discussions between Nicholas Gilley and Reynolds’ damages expert, Dr. Sullivan.
`
`First, Reynolds should be compelled to provide a fully prepared witness on Topic 28
`
`directed to the
`
`. Reynolds admits that the
`
`
`
` is relevant to damages and that both parties’ damages experts rely on that
`
`agreement to calculate a reasonable royalty for certain Asserted Patents. Dkt. 555 at 1, 4. Yet
`
`Reynolds steadfastly refuses to provide a fully-educated witness on Topic 28 because “the
`
`negotiations” of that agreement are allegedly irrelevant (according to Reynolds) since both experts
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`purportedly only “relied on the terms.” Id. at 5-6. Reynolds’ opposition is based on an overly
`
`narrow, contrived construct of the discovery sought. Counterclaim Plaintiffs are entitled to explore
`
`through a properly prepared Rule 30(b)(6) witness the financial and other considerations, including
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`contemporaneous projections, discount rates, and any other facts that went into Reynolds’
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`consideration of the agreement. This includes any actual consideration of effective royalty rates
`
`based on information and projections known at the time, or the absence of any such consideration.
`
`That both damages experts allegedly relied on “the terms” of the
`
`
`
` does not somehow preclude discovery of additional facts relating to that agreement.
`
`And Reynolds cannot genuinely contend that Mr. Gilley was sufficiently prepared on the full scope
`
`of the Topic 28, as required, when he admittedly never reviewed its terms and never conferred
`
`with or reviewed any communications from the non-lawyers involved in the settlement.
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`Second, Reynolds should be ordered to make Mr. Gilley available for a one-hour personal
`
`fact deposition on the subject matter of his recent discussions with Reynolds’ damages expert.
`
`Reynolds does not dispute that this discussion occurred months after Mr. Gilley’s December 2020
`
`1
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 5 of 22 PageID# 12431
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`deposition. Reynolds also does not dispute that, during that discussion, Mr. Gilley provided
`
`infonnation about
`
`Dkt. 547, Ex. 2 (Sullivan Rbt.
`
`Rpt.) at Attachment A-8. And Reynolds does not dispute that Counterclaim Plaintiffs have had
`
`no opportunity to depose Mr. Gilley on his discussion with Dr. Sullivan or the purpo1ied ,_
`
`-
`
`he told Dr. Sullivan about. Instead, Reynolds disto1is the facts to claim that Counterclaim
`
`Plaintiffs should have had notice to depose Mr. Gilley on this single document, which undisputedly
`
`was never identified during discovery. Counterclaim Plaintiffs should be able to explore Mr.
`
`Gilley's knowledge on these
`
`, which go to the heali of
`
`Reynolds' damages theories and did not become a disputed issue until months after his deposition.
`
`Third, Reynolds does not dispute that its expe1is opine on various
`
`Nor does Reynolds dispute
`
`that its expert, Mr. Kodama, opines that
`
`to the
`
`accused products than others. And Reynolds does not dispute that Mr. Kodama's opinion, which
`
`Reynolds intends to present to the jmy, is predicated on facts about these products. Reynolds
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`neve1iheless maintains that it need not produce a knowledgeable corporate witness so that
`
`Counterclaim Plaintiffs can explore the underlying factual premise of Reynolds' expe1i's
`
`assumptions regarding the pmpo1ied acceptability and comparability of its alleged non-infringing
`
`alternatives. This is not technical expe1i subject matter-it is factual testimony directed to
`
`company knowledge regarding the comparison and acceptability of these
`
`from
`
`a commercial, technical, financial, and marketplace perspective. Counterclaim Plaintiffs are
`
`entitled to a Rule 30(b)(6) witness on this topic. Reynolds' asse1iion that this is purely expe1i
`
`2
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 6 of 22 PageID# 12432
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`subject matter is incorrect, and Reynolds should be directed to produce a corporate designee on
`
`Topic 54.
`
`Fourth, with regard to Topic 78, Reynolds does not dispute that it performed teardowns or
`
`other analyses of
`
` Why Reynolds did so, and what it learned in the
`
`process, is potentially highly relevant to a range of damages, validity, and willfulness issues in the
`
`case. Reynolds’ counsels’ say-so that Reynolds’ conduct was not culpable is no substitute for the
`
`probative and relevant Rule 30(b)(6) fact discovery sought.
`
`Accordingly, Counterclaim Plaintiffs respectfully request that the Court compel Reynolds
`
`to (i) designate a corporate witness for Topics 28, 54, and 78, and (ii) make Mr. Gilley available
`
`for a one-hour deposition on his discussion with Reynolds’ damages expert.
`
`II.
`
`ARGUMENT
`
`A.
`
`Reynolds Must Designate A Corporate Witness For Topic 28 (As It Relates
`To The
`)
`
`Reynolds admits the
`
` is relevant to damages. Dkt.
`
`555 at 4. And Reynolds admits that both parties’ damages experts rely on that agreement to
`
`calculate a reasonable royalty for certain Asserted Patents. Id. at 1. Yet Reynolds refuses to
`
`produce an educated witness on the full scope of Topic 28 because, according to Reynolds,
`
`(1) Counterclaim Plaintiffs only seek to elicit facts about purportedly irrelevant “negotiations”
`
`leading to that agreement; (2) Mr. Gilley was allegedly prepared to testify about what Reynolds
`
`considers to be “the relevant scope of Topic 28.” Id. at 4. Both arguments fail.
`
`As an initial matter, Reynolds’ cries of alleged undue delay (id. at 4-5) ring hollow. It is
`
`undisputed that Counterclaim Plaintiffs noted Mr. Gilley’s unpreparedness at his deposition and
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`promptly raised the issue days later. Id. at 4. Ignoring these facts, Reynolds asserts delay because
`
`their December 10, 2020 email was met with “silence” until “late February.” Id. at 4-5. But this
`
`3
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 7 of 22 PageID# 12433
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`case was stayed from December 4, 2020 to February 16, 2021 (Dkts. 425, 456), and Reynolds
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`admits Counterclaim Plaintiffs raised this issue (again) shortly after the Court lifted the stay. Id.
`
`at 5 (citing Dkt. 547, Ex. 6). In any event, fact discovery remains open and, as discussed below,
`
`both of Reynolds’ arguments for blocking this legitimate discovery fail.
`
`First, Reynolds’ argument that the
`
` “negotiations” are irrelevant rests on its
`
`incorrect assertion that “both parties’ damages experts merely relied on the terms of the
`
`” Dkt. 555 at 5-6. Putting aside Reynolds’ mischaracterizations,
`
`Topic 28 is not limited to merely the
`
` “negotiations.” It is directed to the agreement itself
`
`and to all communications and negotiations relating thereto. As Counterclaim Plaintiffs explained,
`
`but Reynolds fails to address, Dr. Sullivan calculated the “
`
`
`
`
`
`. Dkt. 547 at 4-5. The facts regarding the negotiations, and specifically the
`
`information Reynolds considered (and did not) to determine the
`
`, will show that
`
`Dr. Sullivan’s analysis is fundamentally flawed. For example, had Dr. Sullivan used
`
`
`
`, his “effective royalty rate”
`
`would have been much higher. Likewise, had he used an appropriate
`
`
`
`, rather than the self-serving
`
` that Mr. Gilley told
`
`him was “
`
` Dr. Sullivan’s effective royalty rate
`
`would have been significantly higher.1 Counterclaim Plaintiffs are entitled to explore Reynolds’
`
`
`
`1 Reynolds’ reliance on Sanofi-Aventis U.S. v. Genentech, Inc. is misplaced because the relevant
`settlement agreements had neither been produced nor considered by any expert, and thus there
`could not be any “showing of need to go beyond the four corners of the settlement agreements.”
`No. 15-cv-5685, 2016 WL 7444676, at *3 (C.D. Cal. Mar. 30, 2016). Unlike Sanofi, here both
`experts have addressed the agreement and discovery of the factual circumstances underlying those
`agreements are necessary to test the soundness of their analyses and conclusions.
`
`4
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 8 of 22 PageID# 12434
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`knowledge of the negotiations leading up to, the circumstances surrounding, and the information
`
`that Reynolds actually considered when negotiating the agreement. Counterclaim Plaintiffs are
`
`entitled to test the factual assumptions regarding the
`
`
`
` used by Dr.
`
`Sullivan, and the effective royalty rate he calculates therefrom, based upon the real-world facts
`
`surrounding this
`
` deal. It strains credibility to suggest that nobody within the company,
`
`other than outside litigation counsel, were involved in that process, and the communications and
`
`other information considered (internally and externally) regarding the
`
` are
`
`indisputably probative to determining the correct royalty rate.
`
` Even if both damages experts only relied on “the terms” of the
`
`
`
`, that is no basis to preclude discovery of additional facts relating to that agreement.
`
`As Counterclaim Plaintiffs explained (Dkt. 547 at 9-10) but Reynolds’ opposition ignores, it is
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`nonsensical to fault Counterclaim Plaintiffs’ expert for “not rely[ing] on the negotiations leading
`
`to the agreement” (Dkt. 555 at 9) when Reynolds has steadfastly refused to provide such
`
`information through a properly prepared fact witness. Fact discovery remains open and the Court’s
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`schedule expressly permits experts to submit supplemental reports identifying evidence—such as
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`the requested testimony—unavailable at the time of previously-submitted reports. Dkts. 513, 514.
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`Reynolds’ effort to evade this discovery cannot be squared with the positions it took when
`
`pursuing Rule 30(b)(6) testimony from Counterclaim Plaintiffs. For example, Reynolds noticed
`
`PMP’s corporate deposition on Topic 44, which relates to “[t]he negotiation and acquisition of the
`
`’265 [Patent].” Ex. 24 at 13. And, in their reports, both parties’ experts agreed the ’265 Patent
`
`acquisition agreement was not comparable to the hypothetical negotiation. Yet, when
`
`Counterclaim Plaintiffs objected to producing corporate testimony about an undisputedly non-
`
`5
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 9 of 22 PageID# 12435
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`comparable agreement , Reynolds insisted that it “is entitled to” testimony regarding “the
`
`negotiation” leading to this agreement:
`
`With respect to Topic 44, we do not agree that the lack of comparability between
`the purchase agreement for the ’265 patent and the agreement that would result
`from a hypothetical negotiation between the parties obviates the need for
`information regarding the negotiation and acquisition of the asserted ’265 patent.
`Reynolds is entitled to explore other information regarding the purchase and
`decision to purchase the patent[.]
`
`Ex. 25 (4/5/21 Ltr. from Smith) at 1-2. What is sauce for the goose is sauce for the gander.
`
`Reynolds cannot insist that Counterclaim Plaintiffs provide Rule 30(b)(6) testimony about “the
`
`negotiation” leading to an agreement that both experts agree is not relevant to damages while
`
`evading factual testimony about the negotiations that led to the agreement that both experts agree
`
`is relevant to damages.
`
`Reynolds implies, but never expressly argues, that testimony about the negotiations is
`
`somehow “not admissible” under Rule 408. Dkt. 555 at 8 (citing In re MSTG, Inc., 675 F.3d 1337
`
`(Fed. Cir. 2012)). Reynolds is wrong because the actual agreement is undisputedly relevant to
`
`damages and not barred by Rule 408; the same is true for the negotiations that led to that
`
`agreement. Regardless, Reynolds’ objection goes to admissibility, which is an issue for another
`
`day, and “[d]iscovery need not be admissible in evidence to be discoverable.” Kajeet, Inc. v.
`
`Qustodio, LLC, No. 18-cv-1519, 2019 WL 8060078, at *8 (C.D. Cal. Oct. 22, 2019) (overruling
`
`Rule 408 objection to producing documents “underlying licensing/settlement negotiations”
`
`because “information need not be admissible in evidence to be discoverable”); In re MSTG, 675
`
`F.3d at 1335 (“[S]ettlement negotiations related to reasonable royalties and damage calculations
`
`are not protected by a settlement negotiation privilege”).
`
`The Court should note that In re MSTG, cited by Reynolds (Dkt. 555 at 8), supports
`
`Counterclaim Plaintiffs. In MSTG, the trial court “ordered production of the negotiation
`
`6
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 10 of 22 PageID# 12436
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`documents” underlying a settlement agreement for the same reason the Court should grant this
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`Motion: the factual information “might contain information showing that the grounds [MSTG’s
`
`damages expert] relied on to reach his conclusion are erroneous,” and the patentee should have
`
`“the ability to test the accuracy of [the expert’s] opinions and assumption.” Id. at 1347. The
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`Federal Circuit affirmed that decision. Id. Likewise, in Kajeet, the trial court relied on MSTG to
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`overrule a Rule 408 objection and reject the argument that “documents regarding plaintiff’s
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`underlying licensing/settlement negotiations” need not be produced because “plaintiff will rely on
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`the settlement and license agreements and not on the underlying negotiations.” 2019 WL 8060078,
`
`at *8. Instead, the court ordered the plaintiff to produce such documents because they “could aid
`
`defendant in its calculations concerning a reasonable royalty amount and damage.” 2019 WL
`
`8060078, at *8; see also, e.g., Clear with Computers, LLC v. Bergdorf Goodman, Inc., 753 F.
`
`Supp. 2d 662, 664 (E.D. Tex. 2010) (ordering production of settlement-related communications
`
`that may “be key in determining whether the settlement agreements accurately reflect the
`
`inventions’ value or were strongly influenced by a desire to avoid or end full litigation”).
`
`The same result follows here. Counterclaim Plaintiffs should be able to discover the
`
`relevant facts about the information Reynolds considered, and did not consider, when negotiating
`
`the
`
` in order to “test the accuracy” of Reynolds’ experts’
`
`analysis and discover whether “the grounds [he] relied on to reach his conclusion are erroneous.”
`
`In re MSTG, 675 F.3d at 1337. Reynolds provides no legitimate basis to block fact discovery
`
`underlying an agreement relied on by both parties’ damages experts. The Court should compel
`
`Reynolds to produce a fully-educated witness on the full scope of Topic 28.
`
`Second, Reynolds’ contends that Mr. Gilley was “sufficiently prepared on all relevant
`
`aspects” of the
`
`. Dkt. 555 at 10. Reynolds is wrong and its
`
`7
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 11 of 22 PageID# 12437
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`argument fails because it is premised on Reynolds’ erroneous position as to “the relevant aspects”
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`of Topic 28. There can be no credible dispute that Mr. Gilley was unprepared to testify on the full
`
`scope of Topic 28. (Indeed he was unprepared even under Reynolds’ unreasonably narrow view
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`of Topic 28.) While Reynolds argues that he purportedly
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` the agreement, Reynolds
`
`ignores Mr. Gilley’s express admission that he
`
` Dkt. 547, Ex. 1 (Gilley
`
`Dep.) at 212:10-13, 217:22-25. Similarly, while it points to Mr. Gilley’s discussions “
`
` Reynolds does not dispute that
`
`
`
` and that
`
`
`
`
`
`
`
`
`
` Id. at 214:5-217:2.
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`That is the parroting of a litigation position, not the “conscientious, good-faith effort … to prepare
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`[a witness] to fully and unevasively answer questions about the designated subject matter,” to
`
`which Reynolds is obligated. Loboa v. Women’s Health Alliance, P.A., No. 18-cv-329, 2020 WL
`
`889739, at *2 (E.D.N.C. Feb. 24, 2020) (citations omitted).
`
`The Court should compel Reynolds to produce a prepared witness on the full scope of
`
`Topic 28 relating to the
`
`. It is hard to contemplate that
`
`Reynolds entered into a
`
`
`
`
`
`. If so, a fact witness needs to say so, and Mr. Gilley undisputedly
`
`never spoke to any such individuals or considered any communications (written or oral) from non-
`
`lawyers involved in or approving the settlement.
`
`B.
`
`Reynolds Must Make Mr. Gilley Available For A One-Hour Deposition On
`His Conversation With Dr. Sullivan
`
`Reynolds admits that Mr. Gilley had a private discussion with Reynolds’ damages expert
`
`in which he provided factual information that Dr. Sullivan relied on to calculate a reasonable
`
`8
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`

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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 12 of 22 PageID# 12438
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`royalty for four Asserted Patents. Dkt. 555 at 1, 13. Reynolds admits that this discussion occurred
`
`months after Mr. Gilley’s deposition, and one day before Dr. Sullivan submitted his report. And
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`there can be no credible dispute that these spoon-fed “facts” are important because they relate to
`
`.” Id. at 13. Those projections go to
`
`the heart of Dr. Sullivan’s
`
`, and their “credibility.” Supra at 4-
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`5. Reynolds contends that Mr. Gilley can spoon-feed self-serving facts to its damages expert
`
`during private discussions yet shield those discussions from discovery for two reasons. Both fail.
`
`Reynolds first argues that no deposition is warranted because the sole document Mr. Gilley
`
`discussed with Dr. Sullivan was produced before his deposition and he was designated to testify
`
`on this topic. Dkt. 555 at 13-14. Reynolds misses the point. Reynolds concedes that Mr. Gilley’s
`
`discussion with Dr. Sullivan occurred on March 23, 2021—over three months after Mr. Gilley was
`
`deposed—and that Counterclaim Plaintiffs have had no opportunity to explore the subject matter
`
`of this discussion. Dkt. 547, Ex. 2 (Sullivan Rpt.) ¶¶ 12, 265, Attachment A-8. And Reynolds
`
`does not dispute that it never identified this document during discovery, in an interrogatory or
`
`otherwise. Reynolds’ assertion that Counterclaim Plaintiffs were on “notice” because it produced
`
`this single document (among the 200,000 plus documents Reynolds produced to date) “was
`
`potentially relevant” (Dkt. 555 at 13-14) to a topic (one of 16 in total) in Mr. Gilley’s deposition,
`
`is simply not a good faith argument. That is particularly true given that Reynolds undisputedly
`
`failed to identify the document during discovery.
`
`Reynolds’ assertion that Counterclaim Plaintiffs were aware of “
`
`
`
`” because Reynolds allegedly disclosed its intent
`
`to rely on the
`
` to calculate damages also lacks credibility.
`
`Dkt. 555 at 15. Although, the agreement was
`
`
`
`9
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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 13 of 22 PageID# 12439
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`, Ex. 26 (Reynolds’ Second Supp. Resp. to Interr. No. 4) at 6,
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`Reynolds undisputedly did not identify the document that Mr. Gilley discussed with Dr. Sullivan.
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`In fact, Reynolds failed to identify any of the “
`
`
`
`
`
` (Dkt. 555 at 14)—even though there was a pending interrogatory dead on point, which
`
`sought “all facts and evidence that support or refute [Reynolds’] damages theories and bases.” Id.
`
`at 1-2.2 The Court should not endorse Reynolds’ hide-the-ball approach to discovery. See, e.g.,
`
`Oracle Am., Inc. v. Google, Inc., No. 10-cv-3561, 2011 WL 13390136, at *1 (N.D. Cal. Nov. 14,
`
`2011) (granting-in-part motion to compel “depositions of the interviewees upon whom defendant’s
`
`‘spoon-fed’ damages experts relied”).
`
`Finally, Reynolds contends that if “a fact witness’s subsequent conversation with an expert
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`[were] good cause for re-deposing the fact witness,” then “Reynolds should be permitted to depose
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`many of Defendants’ witnesses again.” Dkt. 555 at 1. Reynolds’ attempt to distract from the issue
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`should be rejected. Courts “do[] not look favorably upon [the] ‘tit-for-tat’ approach to discovery”
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`that Reynolds’ employs here because a party cannot “condition its compliance with its discovery
`
`obligations on receiving discovery from its opponent.” Genentech, Inc. v. Trustees of Univ. of Pa.,
`
`No. 10-cv-2037, 2011 WL 7074208, at *1 (N.D. Cal. June 10, 2011). Regardless, this argument
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`confirms that Reynolds should produce Mr. Gilley for deposition because, contrary to Reynolds’
`
`misstatement, Reynolds has deposed (or will depose) every fact witness that spoke with
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`Counterclaim Plaintiffs’ damages expert after those discussions occurred:
`
`
`
`2 Reynolds’ reliance on the Court’s prior order denying Counterclaim Plaintiffs’ motion to compel
`a complete response to Interrogatory No. 7 (Dkt. 555 at 16) is misplaced. That interrogatory
`related to Reynolds’ patent infringement claims (which are currently stayed), not the counterclaims
`filed by Counterclaim Plaintiffs and heading to trial.
`
`10
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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 14 of 22 PageID# 12440
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`Witness
`Noori Brifcani
`Andv Liu
`Ed Kiernan
`Am o Rinker
`
`Date of Conversation(s)
`Febrnarv 23, 2021
`December 4, 2020
`Febrnary 23, 2021
`December 7, 2020
`
`Deposition Date
`April 9, 2021
`March 23, 2021
`April 16, 2021
`TBD3
`
`See Ex. 27 (Loi Dep, 3/23/21); Ex. 28 (Brifcani Dep, 4/9/21); Ex. 29 (4/12/21 Email from Smith).
`
`And, for the sole witness (Eric Hawes) who Reynolds deposed before his discussion with Mr.
`
`Meyer, Reynolds demanded an oppo1tunity to depose him (again) on his "discussions that Mr.
`
`Meyer relied on for his opinion on damages," and Counterclaim Plaintiffs agreed. Ex. 30 (3/2/21
`
`Ltr. from Laud) at 4. Reynolds cannot have it both ways.
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`Reynolds cannot selectively use witnesses to spoon feed "facts" to its damages expe1i and
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`then block discovery of those discussions. The Comi should compel Reynolds to make Mr. Gilley
`
`available for a one-hour deposition on his discussion with Reynolds' damages expert.
`
`C.
`
`Reynolds Must Designate A Corporate Witness For Topic 54 (Non-Infringing
`Alternatives For The '556 Patent)
`
`Reynolds contends that "[t]here are no facts in dispute on Topic 54 relating to the '556
`
`patent" because its intenogato1y response only states that'
`
`Dkt. 555 at 18. But Reynolds' Opposition
`
`concedes that its expe1is intend to venture well beyond Reynolds ' now admittedly deficient
`
`intenogato1y response in te1ms of what they intend to tell the jury about non-infringing alternatives
`
`to the '556 Patent. For example, Reynolds concedes that its technical expe1i, Mr. Kodama, will
`
`opine that '
`
`" as a non-infringing alternative. Id. at 19. And Reynolds concedes that
`
`3 The paiiies agree Reynolds may depose Mr. Rinker after the April 19 deadline. Dkt. 534 at n.1.
`
`11
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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 15 of 22 PageID# 12441
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`its damages expert will opine that
`
`." Id. Counterclaim Plaintiffs are
`
`entitled to question a knowledgeable corporate witness about the factual basis underlying the
`
`alleged comparability (or in comparability) between these Reynolds' products.
`
`Reynolds' remaining arguments also fail. First, Reynolds contends that Mr. Kodama
`
`"merely rebuts the opinion of Defendants' expe1i on a
`
`. ,, Id.
`
`at 18. But Reynolds cites no case law (there is none) holding that facts about rebuttal expe1i
`
`opinions are not subject to discovery under Rule 30(b)(6). Second, Reynolds asselis that "[t]here
`
`is no underlying Reynolds corporate knowledge on Mr. Kodama's opinion" because he did not
`
`rely on his discussions with any Reynolds' employee or cite any Reynolds documents to suppo1i
`
`his comparability analysis. Id. at 19. This is a non-sequitur. Mr. Kodama's apparent failure to
`
`investigate the underlying facts for his opinions does not mean no such facts exist. Nor does it
`
`mean Counterclaim Plaintiffs are not entitled to a co1porate witness on facts that may refute Mr.
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`Kodama's opinions. Third, Reynolds asse1is that "Defendants have ah-eady deposed Reynolds's
`
`Rule 30(b)(6) co1p orate witness on the structure, function, operation,
`
`)." Id. Topic 54, however, is a different topic that seeks different
`
`facts . Topic 54 calls for Reynolds ' knowledge about the degree of comparability between and
`
`suitability of the alleged non-infringing alternatives (the ve1y issues opined about by Reynolds'
`
`experts), i.e., facts not encompassed by separate topics concerning the "sti11cture, function,
`
`operation, and cost of
`
`." Ex. 3 at 17.
`
`Reynolds should be compelled to produce a knowledgeable witness on Topic 54.
`
`D.
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`Reynolds Must Designate A Corporate Witness For Topic 78
`
`12
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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 16 of 22 PageID# 12442
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`Reynolds’ opposition contends (without basis) that Counterclaim Plaintiffs “evaded
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`discovery” on whether the
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` products practice their patent. Dkt. 555 at 21.
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`Putting aside Reynolds’ unsupported misrepresentation of the record, the fact that Reynolds itself
`
`sought discovery on the same topics to which it now objects confirms they are relevant and
`
`discoverable. See Dkt. 555, Ex. 17 at 4. The reality is that Reynolds has received the discovery it
`
`sought, but now it hopes to (unfairly) deny Counterclaim Plaintiffs reciprocal fact discovery.
`
`Counterclaim Plaintiffs are entitled to explore the facts underlying any and all
`
`
`
` products, as requested in Topic 78.
`
`What Reynolds observed from its undisputed teardowns and analyses—including, for
`
`example, whether it copied such products, learned from them, and/or considered them in the
`
`context of Counterclaim Plaintiffs’ ’545 Patent—is discoverable because it would be highly
`
`relevant to a host of damages, validity, and willfulness issues. Facts showing that these products
`
`practice the ’545 Patent are relevant to commercial success (at least for the
`
` product) and
`
`-
`
`damages (e.g., Georgia Pacific Factors 8-10). The information gleaned by Reynolds during its
`
` of these products may also be probative of Reynolds’ studying and copying of products
`
`that practice the ’545 Patent, which is relevant to the secondary consideration of copying as well
`
`as the jury question of willful infringement. This is particularly true given Reynolds’ admission
`
`.
`
`Reynolds’ assertion that Counterclaim Plaintiffs “do not need” this discovery because they
`
`have access to the
`
` product information misses the mark. Counterclaim
`
`Plaintiffs are entitled to know what Reynolds knew, believed, understood and learned from its
`
` of these products. While this undisputed relevance should resolve this
`
`dispute, Counterclaim Plaintiffs address below Reynolds’ remaining opposition arguments.
`
`13
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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 17 of 22 PageID# 12443
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`First, Reynolds contends that "[t]here is no dispute that two of the products in question,.
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`product are covered by the '545 patent." Dkt. 555 at
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`21. But Reynolds has repeatedly failed to unequivocally admit that these products are covered by
`
`'545 Patent. For example, as recent as March 29, Reynolds
`
`Dkt. 547, Ex. 22 at 3. Similarly, "Reynolds
`
`denies that
`
`practices one or more claims of the '545 Patent
`
`as Reynolds applies the claims." Ex. 31 (Resp. to RFA N o. 270) at 8. And, when Counterclaim
`
`Plaintiffs asked Reynolds to unequivocally stipulate that the
`
`products
`
`practice the '545 Patent, Reynolds refused. See, e.g. , Dkt. 555 at Ex. 19. Having made a tactical
`
`choice to make this a disputed issue, Reynolds cannot now block discove1y about documents
`
`containing info1mation related to its own
`
`products.
`
`Second, Reynolds claims that Counterclaim Plaintiffs "misleadingly suggest that Topic 78
`
`relates to all the
`
`Dkt. 555 at 20. That is wrong. The scope of Topic 78 expressly encompasses an y - -
`
`. See Dkt. 547, Ex. 4 at 7 . The
`
`fact that Reynolds claims it did no
`
`does
`
`not mean that discove1y on - - Reynolds did conduct is nTelevant, or that Counterclaim
`
`Plaintiffs are baned from testing Reynolds non-binding representation. Dkt. 555 at 20.
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`Counterclaim Plaintiffs are not requii·ed to accept Reynolds' attorney argument; they are entitled
`
`14
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`Case 1:20-cv-00393-LO-TCB Document 560 Filed 04/15/21 Page 18 of 22 PageID# 12444
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`to question Reynolds' corporate designee to confom th e facts reasonably within Reynolds '
`
`possession, custody, and contrnl.
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`Regardless, even if Reynolds did not fully
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`. . . . , its own discove1y responses indicate
`
`within the
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`scope of Topic 78. Ex. 32 (3/29/21 Resp. to Interr.. No. 28) at 3
`
`Consequently, any analysis about these products, even if a fo1mal - - was not conducted, is
`
`discoverable and falls within Topic 78. Dkt. 547, Ex. 4 at 7
`
`argued that it did not perfo1m
`
`Notably, Reynolds has not
`
`Dkt. 555 at 22.
`
`If Reynolds did not conduct any such an alyses, its Rule 30(b )( 6) witness can just say so in binding
`
`corporate testimony, and then testify about the
`
`Reynolds admits it
`
`perfon ned, including th ose on th
`
`. And the witness can explain
`
`any discrepancies between his testimony and Reynolds' intenogato1y response.
`
`Third, Reynolds claims that " [c]ompelling fact testimony from Reynolds on Topic 78
`
`would also be unfair given Defendants ' superior access to the relevant facts." Dkt. 555 at 24-25.
`
`Tellingly, Reynolds cites no case law to suppo1i its asse1i ion. Dkt. 555 at 25-25. Putting that
`
`aside, Reynold