Case 1:20-cv-00393-LO-TCB Document 740 Filed 06/17/21 Page 1 of 15 PageID# 20283
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF VIRGINIA
`ALEXANDRIA DIVISION
`
`RAI STRATEGIC HOLDINGS, INC. and
`R.J. REYNOLDS VAPOR COMPANY,
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`Plaintiffs and Counterclaim Defendants,
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`v.
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`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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`REYNOLDS’S REPLY IN SUPPORT OF MOTION FOR RELIEF FROM STIPULATION ON
`DEPOSITION DATES IN LIGHT OF NEW INJUNCTION-RELATED CONTENTIONS FROM
`PHILIP MORRIS PRODUCTS S.A.
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`

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`Case 1:20-cv-00393-LO-TCB Document 740 Filed 06/17/21 Page 2 of 15 PageID# 20284
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`
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`I.
`II.
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`III.
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`TABLE OF CONTENTS
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`B.
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`INTRODUCTION ............................................................................................................. 1
`ARGUMENT ..................................................................................................................... 2
`A.
`There is no question that PMP added its injunction-related contentions
`around VEEV for the first time on June 8, weeks after the Court entered
`the stipulation setting Dr. Figlar’s deposition ........................................................ 2
`PMP should not be allowed to simultaneously rely on VEEV as a basis for
`injunctive relief, while refusing to respond to discovery about it .......................... 5
`Permitting Dr. Figlar the courtesy of sitting for deposition only once will
`not prejudice PMP.................................................................................................. 9
`CONCLUSION ................................................................................................................ 10
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`
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`C.
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`i
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`

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`I.
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`INTRODUCTION
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`Reynolds’s motion is simple, and should not be controversial. Dr. James Figlar, who is
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`retired and lives abroad, has been designated under Rule 30(b)(6) to testify on behalf of Reynolds
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`relating to its contentions about why PMP is not entitled to injunctive relief. By stipulation (Dkt.
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`668), Dr. Figlar is scheduled to testify about these issues on June 24. After that stipulation was
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`entered, however, PMP altered and materially expanded its injunction contentions—adding claims
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`around an entirely new product (VEEV) that has never before featured in its contentions, or in this
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`case generally. Indeed, PMP waited to lodge its new VEEV contentions until the day after this
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`Court partially denied Reynolds’s motion to stay injunction-related discovery, which motion PMP
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`had resisted by assuring the Court that fact discovery on these issues was “within weeks of”
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`completion. (Dkt. 666 at 1.)
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`To the extent that PMP’s statement to the Court was ever true, it is certainly not true now.
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`PMP’s introduction of the VEEV product as a new basis for injunctive relief required Reynolds to
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`serve discovery requests related to that product, which it did promptly on June 11, just three days
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`after receiving PMP’s new contentions. Reynolds must digest the information that PMP produces
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`in response and then amend its own counter-contentions accordingly (right now, Reynolds’s
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`counter-contentions only address IQOS). Only once all of this work is complete can Dr. Figlar
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`offer complete testimony about Reynolds’s injunction-related contentions. The discovery cannot
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`be completed by June 24—indeed, PMP’s responses are not even due until June 25, and PMP
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`apparently has no intention of complying by that date, or any other (Dkt. 724 at 13, n.7)—and so
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`Reynolds respectfully requests relief from the stipulation (Dkt. 668), so that Dr. Figlar is only
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`deposed one time, at a mutually convenient date after the parties complete the written and
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`document discovery occasioned by PMP’s new claims.
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`PMP’s opposition to this eminently reasonable request lacks merit, especially given that
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`1
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`trial in this matter is not scheduled until April 2022. Unable to defend its own actions, PMP levels
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`various accusations at Reynolds, and seeks to place blame on Reynolds for supposedly
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`“delay[ing]” Dr. Figlar’s deposition. (Dkt. 724 at 4.) But none of that can detract from the issue,
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`which is simple. Reynolds had nothing to do with PMP’s decision to add injunction-related
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`contentions about VEEV to this case for the first time on June 8. PMP did that, and its decision to
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`do so has ordinary and predictable consequences—including that Reynolds now has to conduct
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`additional discovery about those new contentions. Dr. Figlar should not have to sit for deposition
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`until that discovery is complete, else PMP will surely demand that he be deposed twice. PMP’s
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`opposition is groundless, and Reynolds’s motion should be granted.
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`II.
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`ARGUMENT
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`A.
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`There is no question that PMP added its injunction-related contentions
`around VEEV for the first time on June 8, after the Court entered the
`stipulation setting Dr. Figlar’s deposition.
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`The stipulation fixing Dr. Figlar’s June 24 deposition date was submitted to the Court on
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`May 27, 2021. (Dkt. 668.) The parties agreed to complete their respective productions of
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`documents in response to injunction-related requests by June 7. (Dkt. 668.) After both of those
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`dates passed, however, PMP amended its contentions on June 8, setting out for the first time the
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`claim that an injunction barring Reynolds’s VUSE products from the U.S. market was justified not
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`only by the supposed “irreparable harm” the VUSE products were causing to PMP’s IQOS
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`products in the U.S., but also the future harm that VUSE might someday cause to a different PMP
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`product (VEEV) that is not—and never has been—sold here. (See Dkt. 709-4.) June 8 is the very
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`first time that the word VEEV appeared in PMP’s injunction contentions. Those are the facts.
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`And those facts entitle Reynolds to relief from Dr. Figlar’s stipulated deposition date. (See Dkt.
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`716 at 2-5.)
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`PMP’s assertion that Reynolds “had full knowledge” that its claim for injunctive relief was
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`2
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`in fact grounded on the VEEV product as early as April 9, when PMP served its initial injunction
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`contentions, strains credulity. (Dkt. 721 at 3.) Reynolds attached PMP’s April 9 contentions as
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`Exhibit 1 to its Motion. (Dkt. 709-1.) As the Court can see for itself, PMP never mentioned the
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`VEEV product. Not once. Instead, the only PMP product discussed in all 36 pages of those
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`contentions as providing a basis for injunctive relief was IQOS. (Dkt. 709-1.) PMP nevertheless
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`claims that Reynolds should have known that PMP’s injunction request was somehow tied to
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`VEEV because—in addition to extensively discussing IQOS—the April 9 contentions also vaguely
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`alluded to PMP’s other “past, present, and future non-combustible product offerings in the United
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`States.” (Dkt. 721 at 8.) If it were true that Reynolds should have discerned from that hazy phrase
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`that PMP planned to pin its injunction case on VEEV—indeed, if PMP even thought it were true—
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`then one wonders why PMP felt any need to issue new contentions on June 8 that specifically
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`spelled out PMP’s arguments around VEEV.
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`The answer, of course, is that PMP’s assertion that it “disclosed its reliance” on VEEV on
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`April 9 is not true. Reynolds did not know that PMP was putting forward the VEEV product as a
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`basis for injunctive relief until PMP served contentions saying so, which it did for the first time on
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`June 8.1 Indeed, after reviewing the April 9 contentions from PMP (which included only the vague
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`reference to “future” PMP product “offerings”), Reynolds gave its responses to certain Requests
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`for Admission that PMP had served, purportedly as part of discovery related to the claim for
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`injunction relief. These included, for example, requests to “Admit that Reynolds is developing a
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`product to compete against the VEEV e-cigarette”; and to “Admit that Reynolds has conducted
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`1 PMP notes that it referenced possible arguments around VEEV in its opposition to Reynolds’s
`motion to stay (see Dkt. 666 at 11-12). That is true, and Reynolds replied the very next day that,
`if PMP went forward to actually add injunction-related contentions around VEEV—as opposed to
`merely threatening it in a brief, then Reynolds would have to serve new discovery requests relating
`to that product. (Dkt. 675 at 9.)
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`3
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`product evaluations of VEEV.” (See Reynolds Ex. 6, [Reynolds’s Objections and Responses to
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`PMP’s Eighth Set of Requests for Admission (Nos. 360-405)], at 40-42.) As to these VEEV-
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`specific requests, Reynolds objected and refused to answer on the ground that the requests were
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`“not directed to discovery related to PMP’s claim for injunctive relief, which is the only topic for
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`discovery permitted by the Court to be taken out of time.” (Id.) Reynolds served these responses
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`on May 11, weeks after reviewing PMP’s April 9 injunctive-relief contentions, and clearly
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`communicated its understanding that the VEEV product was not related to PMP’s claim for
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`injunctive relief. PMP never pushed back on this response, nor sought to correct Reynolds’s
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`understanding of the nature of PMP’s claims.
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`The reason for PMP’s behavior is clear: As of May 11, when Reynolds served those
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`responses, VEEV was not the subject of PMP’s claim for injunctive relief. IQOS was. The only
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`reason that changed was because, on May 14, Judge Cheney issued the Initial Determination in
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`the parallel ITC Investigation, finding that IQOS infringes two valid Reynolds patents and
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`recommending a limited exclusion order prohibiting importation of the IQOS products into the
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`United States. (See Dkt. 709 at 4.) As this Court appropriately recognized in ruling on Reynolds’s
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`motion to stay, that Initial Determination, if upheld, “undercuts the irreparable harm undergirding
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`PMP’s claim for injunctive relief.” (Dkt. 702.) So, on the very next day after the Court ruled, and
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`despite assuring the Court that fact discovery on injunctive relief issues was mere “weeks” from
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`completion (Dkt. 666 at 1), PMP served its new contentions, which for the first time articulated
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`theories of irreparable harm based on the VEEV product.
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`PMP’s attempt to brush off its newfound VEEV contentions as “neither ‘new’ nor ‘late-
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`disclosed,’” nor anything that expands the scope of injunctive-related issues, does not hold water.
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`(Dkt. 724 at 7-8.) The VEEV contentions are new; the Court need only compare the April 9
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`4
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`contentions (no VEEV) with the June 8 contentions (VEEV) to confirm this. And the new
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`contentions absolutely change the scope of injunction-related issues. Previously, PMP linked its
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`injunction request solely to IQOS, and Reynolds conformed its responsive counter-contentions
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`accordingly.2 (See Dkt. 709-2.) Consistent with the Court’s instruction to “limit [discovery] as
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`much as you can,” (Dkt. 532 at 10-11), Reynolds took PMP at its word that its case for injunctive
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`relief would be limited to IQOS, the only product PMP identified. Now, PMP wants to shift its
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`contentions to include VEEV—a vaping product that is not even sold in the United States, and its
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`position is that Reynolds should have guessed this was so long before June 8, when PMP actually
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`said it. That is not how civil discovery proceeds, and certainly not when the stakes are as high as
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`they are here. The injunction that PMP seeks would bar Reynolds’s popular VUSE line of products
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`from the marketplace entirely, which would inexorably cause serious harm to Reynolds.
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`Accordingly, any change to PMP’s asserted grounds—and certainly one as significant as adding a
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`wholly new product to the calculus—is important, notwithstanding PMP’s attempts to suggest
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`otherwise. Reynolds should have a full and fair opportunity to meet and refute these new
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`contentions through discovery.
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`B.
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`PMP should not be allowed to simultaneously rely on VEEV as a basis for
`injunctive relief, while refusing to respond to discovery about it.
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`Now that PMP has introduced VEEV to the injunction case, Reynolds requires VEEV-
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`related discovery to supplement its own response to PMP’s contention interrogatory and to explain
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`2 PMP points to Reynolds’s response to its RFP 242, which sought VEEV documents, to claim
`that Reynolds’s need to collect and review VEEV-related documents is “meritless.” (Dkt. 724 at
`9.) That RFP was served March 26, and Reynolds responded April 9, all well before PMP ever
`proffered contentions suggesting that VEEV was a basis for its injunction request. Reynolds
`obviously needs to revisit the issue now that PMP’s contentions on VEEV have changed.
`Moreover, RFP 242 was directed by PMP to Reynolds; Reynolds has not yet had an opportunity
`to direct similar requests back to PMP. It had no reason to do so before seeing the new contentions
`on June 8, but it quickly moved to serve such requests on June 11. Once PMP responds and
`produces its own information, Reynolds can amend its own injunction-related contentions.
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`5
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`why the VEEV product would not be a basis for granting PMP injunctive relief. Only once that is
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`done can Reynolds prepare Dr. Figlar, its Rule 30(b)(6) designee, to testify about Reynolds’s
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`contentions in full. (Dkt. 709 at 6.) If Dr. Figlar sits for deposition on June 24 as required by the
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`stipulation, he will—through no fault of his own or of Reynolds—be unprepared to testify fully as
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`to Reynolds’s contentions around VEEV, because Reynolds will not even be in a position to submit
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`its counter-contentions by that date. This places Dr. Figlar, who is retired, at a clear risk of being
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`forced to testify twice, which would be inefficient and prejudicial.
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`PMP insists that the parties have already conducted “significant discovery on VEEV” and
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`VEEV-related injunctive discovery “falls within the scope of” discovery to date, despite its failure
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`to identify VEEV as a basis for injunctive relief until June 8. (Dkt. 724 at 9.) Discovery on its
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`new theory, PMP says, is “unnecessary” or even “unwarranted.” (Dkt. 724 at 10-11.) PMP is
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`wrong.
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`First, and to be very clear, before seeing PMP’s new contentions on June 8, Reynolds did
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`not serve any discovery requests directed to VEEV in this case. Period. The fact that VEEV may
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`have been mentioned in stray documents produced by PMP that were otherwise responsive to
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`requests that Reynolds did serve (because they also mentioned IQOS, for example) is a far cry
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`from saying that Reynolds already conducted full discovery on the VEEV product. PMP suggests
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`that VEEV discovery “falls within the scope of Reynolds’ already-served injunctive relief
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`discovery,” but that is belied by PMP’s own responses to those very requests. For example,
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`Reynolds served a request for all documents that “PMP relies on to support any contention that
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`Plaintiffs’ VUSE products have taken away, are taking away, or are expected to take away sales
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`of Defendants’ IQOS products in the United States.” (See Reynolds Ex. 7 [PMP’s Response to
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`Plaintiffs’ Tenth Set of RFPS] at 11-13.) This request is totally consistent with Reynolds’s
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`understanding that IQOS was the sole subject of PMP’s injunction contentions.
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`(Reynolds Ex. 8 [PMP’s Response to Reynolds’s First Set of Interrogatories], at 7-8.) As the Court
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`can plainly see, VEEV is nowhere to be found. Again, the fact that PMP may have produced a
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`handful of documents that mention VEEV is happenstance; this did not happen because Reynolds
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`served requests directed to VEEV, or because PMP agreed to search for and provide them. That
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`important task remains to be done, and in response to the requests served by Reynolds on June 11.
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`Second, PMP’s claim that “VEEV is no surprise to Reynolds” is both true as a general
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`matter, and also irrelevant to the dispute at hand. (Dkt. 724 at 10.) Reynolds never suggested that
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`it was completely unaware of the existence of the VEEV product; it was aware of that product,
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`just as it is aware of myriad other products that PMP and its affiliates offer throughout the world.
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`But general market knowledge is one thing; the knowledge necessary to defend against a sweeping
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`injunction claim in a lawsuit is quite another. Reynolds knew about the IQOS product independent
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`of this litigation, too. Yet PMP has never suggested, nor could it, that this industry knowledge
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`obviated the need for discovery in this case. The same holds true for VEEV. PMP introduced that
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`product into its injunction contentions on June 8, which means Reynolds must now shift its focus
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`on that product from that of a business industry observer to that of a litigant faced with a claim for
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`injunctive relief. That is the purpose of discovery in this, and every other, case.
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`Third, as Reynolds explained, it has taken no depositions directed to VEEV. (Dkt. 709 at
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`10.) PMP points to
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`8
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`Case 1:20-cv-00393-LO-TCB Document 740 Filed 06/17/21 Page 11 of 15 PageID# 20293
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`C.
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`Permitting Dr. Figlar the courtesy of sitting for deposition only once will not
`prejudice PMP.
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`Reynolds is not trying to avoid discovery, nor to unreasonably delay Dr. Figlar’s
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`deposition. When PMP added its new VEEV contentions, Reynolds proposed an orderly plan
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`whereby VEEV-related discovery, including updated counter-contentions from Reynolds, could
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`be completed and then the witnesses for both sides could be completed by mid-August, months
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`before the scheduled April 2022 trial date. (Dkt. 709 at 7-8.) Reynolds’s plan would prevent any
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`of the witnesses from being deposed twice. PMP refused, however, insisting that all depositions
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`go forward on the dates in the stipulation, and it now claims that it will be prejudiced if Dr. Figlar
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`is not forced to testify before VEEV-related discovery is complete. (Dkt. 724 at 14-15.) PMP
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`identifies no such prejudice, however, and there is none.
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`The Court set trial in this matter for April 2022. Without citation, PMP asserts that Dr.
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`Figlar must testify before discovery on VEEV is complete or else “frustrate the Court’s plan.”
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`(Dkt. 724 at 15.) In PMP’s view, when the Court ruled on Reynolds’s motion to stay and instructed
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`that fact discovery on the injunction issues should “proceed through its conclusion” (Dkt. 702),
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`that meant that everything was to be completed by “June 25.” (Dkt. 724 at 14.) Of course, the
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`Court never actually said that. And even if the Court had understood when it entered that Order
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`on June 7 that injunction discovery could be completed in a matter of a few weeks—which would
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`have been a fair assumption, since that is exactly what PMP said in opposing the motion to stay—
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`that understanding was upended the very next day, when PMP served its new contentions around
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`VEEV. PMP not only waited to do this until the day after the Court ruled on the stay motion, it
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`also happened to be the day after the parties had agreed to complete all document production in
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`9
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`Case 1:20-cv-00393-LO-TCB Document 740 Filed 06/17/21 Page 12 of 15 PageID# 20294
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`response to injunction-specific requests. PMP appears to think that the Court’s June 7 ruling on
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`the stay motion and the parties’ agreed June 7 production deadline provide some sort of safe harbor
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`that allows PMP to change its injunction contentions the very next day to add a new product, yet
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`remain immune from further discovery. That is certainly not something to which Reynolds ever
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`agreed.
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`Despite injecting a new theory the day after production of injunction-related documents
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`was to have concluded, PMP’s position appears to be that it would be “orderly” for Figlar to be
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`deposed twice. (Dkt 724 at 14.) Not so. Trial will not take place until April 2022. There is much
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`for the parties to do before Dr. Figlar can be deposed on all of the topics for which he is designated.
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`PMP must respond to Reynolds’s injunction-related discovery requests, including those related to
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`VEEV, which responses are not even due until June 25—after Dr. Figlar is currently scheduled to
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`testify. And PMP has now telegraphed its intention to refuse to comply with Reynolds’s discovery
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`requests (Dkt. 724 at 13, n.7), which will only cause further delay if Reynolds is forced to move
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`to compel. Again, this is in PMP’s hands. However long PMP chooses to drag this out, Reynolds
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`is entitled to discovery on VEEV, is entitled to amend its own contentions in consideration of that
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`discovery, and is entitled to prepare Dr. Figlar as its corporate designee to testify on “[t]he factual
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`bases underlying [Reynolds’s] contention, including [Reynolds’s] response to Interrogatory No.
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`30 . . . that PMP has not suffered irreparable injury,” based on the full scope of PMP’s contentions,
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`including the new contentions around VEEV.
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`III. CONCLUSION
`Reynolds’s Motion for Relief From Stipulation on Deposition Dates in Light of New
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`Injunction-Related Contentions from Philip Morris Products S.A. should be granted. Reynolds
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`respectfully requests that the Court enter an Order directing that, notwithstanding Dkt. 668, the
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`deposition of Dr. Figlar will not go forward on June 24. Instead, Dr. Figlar will be produced for
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`deposition on a mutually-agreed date after Reynolds and PMP have completed discovery relating
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`to PMP’s new contentions about the VEEV product.
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`11
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`Case 1:20-cv-00393-LO-TCB Document 740 Filed 06/17/21 Page 14 of 15 PageID# 20296
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`Dated: June 17, 2021
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`
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`Stephanie E. Parker
`JONES DAY
`1221 Peachtree Street, N.E.
`Suite 400
`Atlanta, GA 30361
`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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`Respectfully submitted,
`
`
`
`
`
` /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
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`1
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`Case 1:20-cv-00393-LO-TCB Document 740 Filed 06/17/21 Page 15 of 15 PageID# 20297
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`CERTIFICATE OF SERVICE
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`I hereby certify that on 17th day of June, 2021, a true and correct copy of the foregoing was
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`served using the Court’s CM/ECF system, with electronic notification of such filing to all counsel
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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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`of record.
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