United States v. Philip Morris USA

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

UNITED STATES OF AMERICA,

Plaintiff,

V. Civil Action No. 99-2496 (PLF)

PHILIP MORRIS USA INC. et al.,

Defendants. )

)

OPINION

The Public Health Intervenors (“Intervenors”) have filed a Motion to Clarify and

Amend Order #1015 (“Mot.”) [Dkt. No. 6445]. Intervenors ask the Court to clarify that

defendant Philip Morris USA, Inc. (“Philip Morris”) and its parent Altria Group, Inc. (“Altria”

and collectively with Philip Morris, “defendants”) are required under Order #1015 — Final

Judgment and Remedial Order (“Order #1015”) [Dkt. No. 5733] to add to Philip Morris’s

Internet Document Website all discovery materials that have been or will be produced by

defendants in a separate proceeding, In re JUUL Labs, Inc., Marketing, Sales Practices, and

Products Liability Litigation (“In re JUUL Labs”), MDL No. 19-2913 (N.D. Cal.) (the “JUUL

MDL”). See Mot. at 1-2. In the alternative, Intervenors ask the Court to amend Order #1015 to

require defendants to add these documents to the Internet Document Website. See id.

Intervenors also request that the Court modify Order #1015 pursuant to

Rule 60(b)(5) of the Federal Rules of Civil Procedure to require defendants to maintain Philip

Morris’s Internet Document Website beyond its September 1, 2021 expiration date. See id. On

August 19, 2021, the Intervenors filed an emergency motion, asking the Court to order the

defendants to maintain the Internet Document Website while the motion to modify Order #1015

is pending. See Public Health Intervenors’ Emergency Motion to Require PM and Altria to

Maintain Their Document Website Until the Court Rules on the Intervenors’ Motion to Clarify

and Amend Order #1015 (“Intervenors’ Emergency Mot.”) [Dkt. No. 6446]. The defendants did

not oppose this request. See Defendants’ Notice of Non-Opposition to Public Health

Intervenors’ Emergency Motion (“Defendants’ Notice of Non-Opposition”) [Dkt. No. 6448]. On

August 25, 2021, the Court granted the Intervenors’ emergency motion and ordered the

defendants to maintain the Internet Document Website until the resolution of the motion to

clarify. See Order #112 — Remand [Dkt. No. 6449].

The Court heard oral argument on the Intervenors’ motion on July 20, 2022.

Upon careful consideration of the parties’ oral and written arguments, the relevant legal

authorities, and the entire record in this case, the Court will grant Intervenors’ motion to clarify,

having concluded that defendants are required under Order #1015 to publish the discovery

materials produced in the JUUL MDL on Philip Morris’s Internet Document Website. !

| The documents and the attachments thereto that the Court has considered with the

pending motion include: Order #1015 — Final Judgment and Remedial Order (“Order #1015”)

[Dkt. No. 5733]; Order #1021 (“Order #1021”) [Dkt. No. 5765]; Public Health Intervenors’

Motion to Clarify and Amend Order #1015 (“Mot.”) [Dkt. No. 6445]; Public Health Intervenors’

Brief in Support of Their Motion to Clarify and Amend Order #1015 (“Intervenors’ Br.”) [Dkt.

No. 6445-1]; Opposition to Public Health Intervenors’ Motion to Clarify and Amend Order

#1015 (“Def. Opp.”) [Dkt. No. 6450]; Public Health Intervenors’ Reply Brief in Support of Their

Motion to Clarify and Amend Order #1015 (“Intervenors’ Reply”) [Dkt. No. 6452]; Public

Health Intervenors’ Supplemental Brief in Support of Their Motion to Clarify and Amend Order

#1015 (“Intervenors’ Suppl.”) [Dkt. No. 6505]; Supplemental Brief of Altria Group, Inc. and

Philip Morris USA Inc. (“Def. Suppl.”) [Dkt. No. 6506]; Joint Stipulation of Altria Group, Inc.,

Philip Morris USA Inc., and Public Health Intervenors Regarding Juul Settlement (“Joint Stip.”)

[Dkt. No. 6517]; Public Health Intervenors’ Emergency Motion to Require PM and Altria to

Maintain Their Document Website Until the Court Rules on the Intervenors’ Motion to Clarify

and Amend Order #1015 (“Intervenors’ Emergency Mot.”) [Dkt. No. 6446]; Defendants’ Notice

of Non-Opposition to Public Health Intervenors’ Emergency Motion (“Defendants’ Notice of

Non-Opposition”) [Dkt. No. 6448]; and Order #112 — Remand [Dkt. No. 6449].

I. BACKGROUND

A. Defendants’ Transparency Obligations

Prior opinions summarize the detailed factual and procedural history in this case.

See United States v. Philip Morris USA Inc., 436 F. Supp. 3d 1, 3-4 (D.D.C. 2019); United

States v. Philip Morris USA Inc., 566 F.3d 1095, 1105-1110 (D.C. Cir. 2009) (per curiam); see

generally United States v. Philip Morris USA, Inc., 449 F. Supp. 2d 1 (D.D.C. 2006).”

In brief, the United States brought this civil action in 1999 against defendants,

among other cigarette manufacturers and two tobacco-related trade organizations, under the

Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 1961-1968. After

substantial pretrial proceedings and discovery and a nine-month bench trial, Judge Kessler found

in 2006 that defendants had violated RICO “by engaging in a lengthy, unlawful conspiracy to

deceive the American public about the health effects of smoking and environmental tobacco

smoke, the addictiveness of nicotine, the health benefits from low tar, ‘light’ cigarettes, and their

manipulation of the design and composition of cigarettes in order to sustain nicotine addiction.”

United States v. Philip Morris USA, Inc., 449 F. Supp. 2d at 26-27. Judge Kessler also

concluded that, “as long as Defendants [we]re in the business of selling and marketing tobacco

products,” there was a “reasonable likelihood” that they would violate RICO again, warranting

injunctive relief. Id. at 909, 911. The Court issued an injunctive remedial order, Order #1015, to

“prevent and restrain” defendants’ future unlawful conduct. See Order #1015; United States v.

Philip Morris USA, Inc., 449 F. Supp. 2d at 923-37.

2 Judge Gladys Kessler presided over this case until her retirement, at which time

the case was reassigned to the undersigned.

Among its many obligations under Order #1015, Philip Morris was required to

maintain an “Internet Document Website” (www.pmdocs.com) until September 1, 2021, at its

expense. See Order #1015 § III.C.8; Order #1021.7 Philip Morris was also required to upload

onto the Internet Document Website “all documents produced on or after [August 17, 2006,] in

any court or administrative action in the United States concerning smoking and health,

marketing, addiction, low-tar or low-nicotine cigarettes, or less hazardous cigarette research” as

well as “all transcripts of depositions and letter of request testimony . . . given by any of [Philip

Morris’s or Altria’s] current or former employees, officers, directors, corporate designees,

attorneys or agents” in any such action. Order #1015 4 IJI.C.10.a (emphasis added); see id.

(requiring Philip Morris to “provide on its website all such documents produced by, pertaining

to, or concerning Altria”).

In ordering these transparency obligations, Judge Kessler observed that

9 66

defendants’ “suppression and concealment of information [was] integral to the [RICO]

Enterprise’s overarching scheme to defraud” the American public. United States v. Philip

Morris, 449 F. Supp. 2d at 928. Requiring defendants to publish “all industry documents

disclosed in litigation” would “allow the public to monitor what Defendants are doing internally

and to assess the accuracy of future information they may make available about their activities

and their products.” Id. Furthermore, “[i]mposing such disclosure requirements [would] act as a

powerful restraint on Defendants’ future fraudulent conduct.” Id. at 928-29.

3 On August 25, 2021, this Court ordered defendants to maintain the Internet

Document Website in its current form pending the Court’s ruling on Intervenors’ motion to

clarify. See Order #112 —- Remand; Intervenors’ Emergency Mot.; and Defendants’ Notice of

Non-Opposition.

B. The Juul MDL

In recent years, states and individual plaintiffs have filed thousands of lawsuits in

both state and federal court against JUUL Labs, Inc. (“JLI”) concerning its marketing practices

and alleged misrepresentations about JUUL products’ health effects.* On October 2, 2019, the

United States Judicial Panel on Multidistrict Litigation (“MDL Panel”) granted common

defendant JLI’s motion to centralize federal litigation involving “allegations that JLI has

marketed its JUUL nicotine delivery products in a manner designed to attract minors, that JLI’s

marketing misrepresents or omits that JUUL products are more potent and addictive than

cigarettes, that JUUL products are defective and unreasonably dangerous due to their

attractiveness to minors, and that JLI promotes nicotine addiction.” Transfer Order, In re Juul

Labs, MDL No. 19-2913 (N.D. Cal. Oct. 2, 2019) [Dkt. No. 1] at 1. The MDL Panel selected the

Northern District of California as the transferee district and assigned the litigation to Judge

William H. Orrick III. See id. at 2.

4 JUUL Labs, Inc. has settled thousands of lawsuits within the past few years,

paying out more than $1 billion total to individual plaintiffs and forty-eight states. See Juul

Labs, Statement by JUUL Labs on Settlement with Minnesota Attorney General (Apr. 17, 2023),

https://www.juullabs.com/statement-by-juul-labs-on-settlement-with-minnesota-attorney-

general/ <https://perma.cc/U8NY-MQTS5> (describing “global resolution of the U.S. private

litigation that covers more than 5,000 cases brought by approximately 10,000 plaintiffs”); see

also Jen Christensen, Juul to pay $438.5 million in settlement with dozens of states over

marketing to undcrage people, CNN (Sept. 6, 2022),

https://www.cnn.com/2022/09/06/health/juul-settlement-marketing/index.html

<https://perma.cc/8JQE-AUZM>. See, e.g., Order Granting Motion for Preliminary Approval of

Class Action Settlement, In re JUUL Labs, MDL No. 19-2913 (N.D. Cal. Jan. 30, 2023) [Dkt.

No. 3779]; Class Settlement Agreement, In re JUUL Labs, MDL No. 19-2913 (N.D. Cal. Dec.

19, 2022) [Dkt. No. 3722-2] at 3 J 1.13; Proposed Consent Order and Judgment, People v. JUUL

Labs, Inc., Index No. 452168/2019 (N.Y. Sup. Ct. Apr. 12, 2023) [Dkt. No. 376],

https://ag.ny.gov/sites/default/files/settlements-agreements/NY %20JUUL%20Final.pdf

<https://perma.cc/8LWS-B7AE>.

The JUUL MDL litigation involves numerous consumer class action and

government entity plaintiffs that allege that JLI, Philip Morris, Altria, and others (collectively,

“JUUL defendants’) violated RICO by “devis[ing] and knowingly carr[ying] out material

schemes and/or artifices to defraud the public and deceive regulators” regarding JUUL’s nicotine

content and addictive potential, its purported creation and design as a “smoking cessation

device,” and its “role in the youth vaping epidemic.” Second Amended Class Action Complaint

(“SACAC”), In re JUUL Labs, MDL No. 19-2913 (N.D. Cal. Nov. 20, 2020) [Dkt. No. 1135]

{ 955; see In re JUUL Labs, 533 F. Supp. 3d 858, 863-64, 875 (N.D. Cal. 2021) (denying

Altria’s motion to dismiss the RICO claims).

The JUUL MDL plaintiffs further assert that Altria and Philip Morris, among

other defendants, directly participated in the following three fraudulent schemes: (1) the

“Nicotine Content Misrepresentation Scheme,” whereby the JUUL defendants caused JUUL

products “‘to be distributed to consumers with false and misleading information regarding [the

products’ ] nicotine content” and potential addictiveness; (2) the “Flavor Preservation Scheme,”

whereby the JUUL defendants “defraud[ed] the public and deceive[d] regulators to prevent

regulation that would have impeded their plan to keep selling to children,” ensuring that certain

flavors that appealed to youth remained on the market; and (3) the “Cover-up Scheme,” whereby

the JUUL defendants adopted a campaign to mislead the public and consumers “by portraying

JUUL as a smoking cessation device and denying that the company ever marketed to youth.” In

re JUUL Labs, 533 F. Supp. 3d at 863 (quoting SACAC 7f 913-950). Defendants have produced

more than 875,000 documents in the JUUL MDL, see Declaration of Kimberly D. Harlowe [Dkt.

No. 6450-1] 4 9, but have not posted any of those documents to Philip Morris’s Internet

Document Website. See Intervenors’ Br. at 6. On January 30, 2023, Judge Orrick preliminarily

approved a class settlement in which JLI agreed to pay $255 million to resolve the class’s claims.

See Order Granting Motion for Preliminary Approval of Class Action Settlement, In re JUUL

Labs, MDL No. 19-2913 (N.D. Cal. Jan. 30, 2023) [Dkt. No. 3779]; Class Settlement

Agreement, In re JUUL Labs, MDL No. 19-2913 (N.D. Cal. Dec. 19, 2022) [Dkt. No. 3722-2]

at 3 § 1.13.

C. Intervenors’ Motion

On August 19, 2021, Intervenors filed a motion asking this Court to clarify

whether defendants were obligated under Order #1015 to publish the JUUL MDL discovery

materials on Philip Morris’s Internet Document Website and, if not, to amend Order #1015 to

require defendants to do so. See Mot. at 444; id. at 5 412. Intervenors further request that the

Court require Philip Morris to continue maintaining its document website to give the defendants

time “to add all of the discovery materials from the JUUL MDL Litigation to [the] document

website and, once they are all added, retain them there for no fewer than 12 months, to give the

public adequate time to review the newly-posted materials.” Id. at 5 13. Although the

defendants’ obligation to maintain the document website was set to expire on September 1, 2021,

the Court — upon the Intervenors’ request and with no opposition from the defendants — ordered

the defendants to maintain the website while the Intervenors’ Motion to Clarify remained

pending. See Order #112 — Remand.

At the Court’s request, the parties have filed supplemental briefing addressing two

recent events: (1) the U.S. Food and Drug Administration’s (“FDA”) issuance of marketing

denial orders to JUUL Labs for all its products currently marketed in the United States; and

(2) JUUL Labs’ settlement with numerous states regarding the marketing of its products to

minors. See Minute Order (June 23, 2022); Minute Order (Sept. 8, 2022); U.S. Food & Drug

Admin., FDA Denies Authorization to Market JUUL Products (June 23, 2022),

https://www.fda.gov/news-events/press-announcements/fda-denies-authorization-market-juul-

products <https://perma.cc/388W-HUZF>; see also id. (noting that on June 24, 2022, the D.C.

Circuit entered a temporary administrative stay of the marketing denial order, and on July 5,

2022, the FDA administratively stayed its marketing denial order). The supplemental filings

indicated that both Intervenors and defendants agree that the FDA action and the state

settlements have no bearing on the issues raised by Intervenors’ motion for clarification. See

Intervenors’ Suppl. at 2; Def. Suppl. at 1; Joint Stip. at 1-2. See also supra at n.4. Intervenors’

motion is now ripe for decision.

II. DISCUSSION

A. Motion to Clarify

1. Legal Standard

There is no Federal Rule of Civil Procedure that specifically governs motions for

clarification. See United States v. All Assets Held at Bank Julius, Baer & Company, Ltd., 315 F.

Supp. 3d 90, 99 (D.D.C. 2018). The case law establishes, however, that the “general purpose of

a motion for clarification is to explain or clarify something ambiguous or vague, not to alter or

amend.” United States v. Philip Morris USA, Inc., 793 F. Supp. 2d 164, 168 (D.D.C. 2011)

(internal quotation omitted). Although a motion for clarification may not open the door to “re-

litigat[ing] a matter that the court has considered and decided,” Sai vy. Transp. Sec. Admin., Civil

Action No. 14-0403, 2015 WL 13889866, at *3 (D.D.C. Aug. 19, 2015), courts in this circuit

have encouraged parties to request clarification when they are uncertain about the scope of a

ruling or its application “in a concrete context or particular factual situation.” United States v.

Philip Morris USA Inc., 793 F. Supp. 2d at 168-69; see, e.g., United States v. Volvo Powertrain

Corp., 758 F.3d 330, 344 (D.C. Cir. 2014); Barnes vy. District of Columbia, 289 F.R.D. 1, 12-13

(D.D.C. 2012).

Rule 65(d) of the Federal Rules of Civil Procedure requires every order granting

an injunction to “state its terms specifically” and “describe in reasonable detail . . . the act or acts

restrained or required.” FED. R. Civ. P. 65(d)(1)(B)-(C). To prevent uncertainty and confusion

on the part of the enjoined party, an injunction must provide “explicit notice of precisely what

conduct is outlawed.” United States v. Philip Morris USA Inc., 566 F.3d at 1137 (quoting

Schmidt v. Lessard, 414 U.S. 473, 476 (1974)); see also 11A CHARLES ALAN WRIGHT, ARTHUR

R. MILLER & MARY KAY KANE, FEDERAL PRACTICE AND PROCEDURE § 2955 (3d ed. 2022) (“The

drafting standard established by Rule 65(d) is that an ordinary person reading the court’s order

should be able to ascertain from the document itself exactly what conduct is proscribed.”).

Moreover, an injunction must be “narrowly tailored to remedy the harm” that it addresses. J.D.

v. Azar, 925 F.3d 1291, 1336 (D.C. Cir. 2019) (quoting Gulf Oil Corp. v. Brock, 778 F.2d 834,

842 (D.C. Cir. 1985)); see ALPO Petfoods, Inc. v. Ralston Purina Co., 913 F.2d 958, 972 (D.C.

Cir. 1990) (“The law requires that courts closely tailor injunctions to the harm that they

address.”). In keeping with these principles, courts generally “resolve ‘omissions or ambiguities

in [an injunction]’ in favor of the enjoined party.” United States ex rel. Yelverton v. Fed. Ins.

Co., 831 F.3d 585, 587 (D.C. Cir. 2016) (citing 11 A WRIGHT, MILLER & KANE, FEDERAL

PRACTICE & PROCEDURE § 2955).

An injunction is “subject to reasonable interpretation” in light of the fair meaning

of its text and the harm it was tailored to address. Alley v. U.S. Dep’t of Health & Hum.

Servs., 590 F.3d 1195, 1206 (11th Cir. 2009) (quoting Riccard v. Prudential Ins. Co., 307

F.3d 1277, 1296 (11th Cir. 2002)). See Nat] Org. for Women v. Operation Rescue, 37 F.3d 646,

657 (D.C. Cir. 1994) (“[T]he meaning of these terms is constrained by the context in which they

are actually used in the injunction,” and the interpretation of an injunction’s language should

account for “the context of the ongoing unlawful [conduct]”); United States v. Philip Morris

USA Inc., 778 F. Supp. 2d 8, 11 (D.D.C. 2011) (interpreting Order #1015 by reading its

language “in conjunction with the purpose to be accomplished by the requirements” of the

injunction). See also Schering Corp. v. Ill. Antibiotics Co., 62 F.3d 903, 906-08 (7th Cir. 1995);

ALPO Petfoods, Inc. v. Ralston Purina Co., 913 F.2d at 972; In re Baldwin-United Corp. 770

F.2d 328, 339-40 (2d Cir. 1985); Alabama Nursing Home Ass’n v. Harris, 617 F.2d 385, 388

(5th Cir. 1980); United States v. Christie Indus., Inc., 465 F.2d 1002, 1009-11 (3d Cir. 1972).

2. The JUUL MDL “Concerns Smoking and Health, Marketing, and Addiction”

Intervenors assert that defendants must publish the documents they produced

during discovery in the JUUL MDL on Philip Morris’s Internet Document Website and ask the

Court to clarify that Order #1015 has always required defendants to do so. See Intervenors’ Br.

at 6. The Intervenors maintain that the JUUL MDL is a court action “concerning smoking and

health, marketing, addiction, low-tar or low-nicotine cigarettes, or less hazardous cigarette

research,” Order #1015 III.C.10.a, because the MDL involves claims against defendants that

closely parallel the claims against defendants in this case, whose conduct was found to be

unlawful under RICO. See Intervenors’ Br. at 4; see also United States v. Philip Morris USA,

Inc., 449 F. Supp. 2d at 852; In re JUUL Labs, 533 F. Supp. 3d at 861 (denying motion to

dismiss RICO claims in JUUL MDL where alleged schemes “had the goal[] of growing the

market of nicotine-addicts”). According to Intervenors, Order #1015 must be interpreted so as to

effectuate the remedial purpose of that order by “allow[ing] the public to monitor what

Defendants are doing internally and to assess the accuracy of future information they may make

10

available about their activities and their products.” Intervenors’ Br. at 2 (quoting United States

v. Philip Morris USA, Inc., 449 F. Supp. 2d at 928-29).

Defendants counter that the JUUL MDL is not a court action “concerning

smoking and health, marketing, addiction, low-tar or low-nicotine cigarettes, or less hazardous

cigarette research” because the JUUL MDL does not concern conventional cigarettes. See Def.

Opp. at 2, 8-10 (quoting United States v. Philip Morris USA Inc., 566 F.3d 1095, 1106 (D.C.

Cir. 2009) (per curiam)). Rather, defendants argue that the JUUL MDL concerns e-cigarettes or

e-vapor products that did not even exist in 2006 when Judge Kessler issued the remedial order.

See Def. Opp. at 8. In defendants’ view, Order #1015 must be narrowly construed in light of the

particular type of product — conventional, combustible cigarettes — that was at issue in this case;

it should not be interpreted to apply to new technologies that were not directly contemplated by

the parties or by Judge Kessler when she issued the remedial order. See id. at 9. Defendants

maintain that they have never been required under Order #1015 to publish the JUUL MDL

discovery materials on Philip Morris’s Internet Document Website and that the Court would

need to amend Order #1015 to require them to do so. Def. Opp. at 2. Defendants further assert

that “[t]he Public Health Intervenors themselves have acknowledged the limits of Order #1015,”

specifically with regard to its application to JUUL products. Id. Defendants point to the fact that

Intervenors agreed that certain requirements of the corrective statement remedy “do not extend to

‘smokeless tobacco, e-cigarettes, and other tobacco derived nicotine products.’” Id. (quoting

Order #81 — Remand [Dkt. No. 6260]). Defendants conclude that “[t]hese and other actions by

the Public Health Intervenors belie any notion that Order #1015 sweeps as broadly as they now

claim.” Def. Opp. at 2.

11

a. The Internet Document Website Requirement is Not Limited to Conventional Cigarettes

The Court concludes that the obligations under Order #1015 regarding the

Internet Document Websites are not limited solely to actions involving conventional cigarettes.

It agrees with Intervenors that the JUUL MDL is a court action “concerning smoking and health,

marketing, addiction, low-tar or low-nicotine cigarettes, or less hazardous cigarette research” for

which defendants must upload their discovery materials to Philip Morris’s Internet Document

Website. Order #1015 § JI.C.10.a. The document website provision’s capacious language — i.e.,

“smoking and health, marketing, addiction” — is broad, and the breadth of this provision directly

reflects the breadth of the RICO violations Judge Kessler found. Order #1015 IIIC.10.a. See

United States v. Philip Morris USA, Inc., 449 F. Supp. 2d at 852 (finding, among other things,

that defendants “lied, misrepresented, and deceived the American public . . . about the

devastating health effects of smoking and environmental tobacco smoke, they suppressed

research, ... manipulated the use of nicotine so as to increase and perpetuate addiction, . . . [and]

distorted the truth about low tar and light cigarettes so as to discourage smokers from quitting”’).

And the D.C. Circuit affirmed the breadth of Order #1015: “These injunctions may be broad, but

breadth is warranted ‘to prevent further violations where[,] [as here,] a proclivity for unlawful

conduct has been shown.” United States v. Philip Morris USA Inc., 566 F.3d at 1137-38

(alteration in original) (quoting SEC v. Savoy Indus., Inc., 587 F.2d 1149, 1317 (D.C.

Cir. 1978)); see generally 11A WRIGHT, MILLER & KANE, FEDERAL PRACTICE AND PROCEDURE

§ 2955 (a “court simply may determine that the only way to prevent a statutory violation and

thereby accomplish the purpose of the legislation is by entering a broad decree”).

Thus, although defendants’ misconduct arose within the context of their

manufacture, marketing, and sale of conventional cigarettes, it was defendants’ conduct — rather

12

than any specific product — that went to the heart of Order #1015’s remedies, including the

document disclosure obligations. See United States v. Philip Morris USA, Inc., 449 F. Supp. 2d

at 928 (“Defendants’ suppression and concealment of information has been integral to the

[RICO] Enterprise’s overarching scheme to defraud. Not only have Defendants failed to

publicly disclose all the information they internally held about their cigarettes, but they have also

created false controversies about the existence of such information.”). Order #1015’s document

disclosure obligations — including the obligation to maintain an Internet Document Website —

were written broadly “to allow the public to monitor what Defendants [we}re doing internally

and to assess the accuracy of future information they may make available about their activities

and their products,” so as to “act as a powerful restraint on [their] future fraudulent conduct.” Id.

at 928-29. Judge Kessler’s injunction was designed to allow the Court, the government, and the

public to monitor defendants’ future conduct with respect to old and new products. See id.

at 909 (“[A]s long as Defendants are in the business of selling and marketing tobacco products,

they will have countless ‘opportunities’ and temptations to take similar unlawful actions in order

to maximize their revenues, just as they have done for the past five decades.”).

The Court is unpersuaded by the argument that defendants’ document disclosure

obligations do not extend to the JUUL MDL because Intervenors agreed that certain

requirements of the corrective statements remedy do not extend to e-cigarettes. This argument

conflates two entirely separate parts of the remedial order — Section HI.C of Order #1015,

concerning “Document Disclosure in Depositories and on Websites,” and Section II.B,

concerning “Corrective Statements.” In the context of the document disclosure obligations, the

JUUL MDL is a court action “concerning smoking and health, marketing, [or] addiction” as

contemplated by Order #1015. Extending these obligations to the JUUL MDL documents is

13

consistent with the text and purpose of Judge Kessler’s remedial order. See United States v.

Philip Morris USA Inc., 778 F. Supp. 2d 8, 11 (D.D.C. 2011) (interpreting Order #1015 by

reading its language “in conjunction with the purpose to be accomplished” by the injunction).

b. Parallels Between This Case and the JOUL MDL

Moreover, the Court has identified three striking similarities between the

allegations in this lawsuit and the allegations in the litigation before Judge Orrick. First, the

JUUL MDL plaintiffs allege that Philip Morris and Altria have helped to direct the “nicotine

content misrepresentation scheme,” causing “thousands, if not millions, of JUUL pod packages

to be distributed to consumers with false and misleading information regarding [their] nicotine

content.” In re JUUL Labs, 533 F. Supp. 3d at 866 (quoting SACAC 4 913). This allegation

overlaps substantially with Judge Kessler’s findings that defendants “publicly, vehemently, and

repeatedly denied the addictiveness of smoking and nicotine’s central role in smoking” and

“designed their cigarettes to precisely control nicotine delivery levels and provide doses of

nicotine sufficient to create and sustain addiction.” United States v. Philip Morris USA, Inc.,

449 F. Supp. 2d at 307, 309; see also id. at 852 (concluding that defendants “maintain[ed] that

neither smoking nor nicotine [wa]s addictive” despite knowing such a statement was false and

“manipulat[ed] the design of cigarettes and the delivery of nicotine to smokers” while denying

that they were doing so).

Second, the JUUL MDL plaintiffs allege that the JUUL defendants, through the

“flavor preservation scheme,” worked to “prevent regulation that would have impeded their plan

to keep selling to children” and “to ensure that the FDA allowed JUUL’s mint flavor to remain

on the market.” In re JUUL Labs, 533 F. Supp. 3d at 863 (quoting SACAC ff 922-29); see id.

at 870-874 (discussing allegations of coordinated “youth-targeted marketing”); see also

14

SACAC 4 948 (alleging that defendants “knowingly and intentionally marketed [JUUL devices]

to youth users”). This closely parallels defendants’ RICO violations in this case, namely, that

they falsely denied that they marketed to youth “while engaging in such marketing and

advertising with the intent of addicting young people and enticing them to become lifelong

smokers.” United States v. Philip Morris USA, Inc., 449 F. Supp. 2d at 852; see also id. at 691

(finding that defendants marketed to young people, knowing that they “were highly susceptible

to marketing and advertising appeals, would underestimate the health risks and effects of

smoking, [and] would overestimate their ability to stop smoking”).

And third, the JUUL MDL plaintiffs allege that Philip Morris and Altria

participated in a “cover up scheme” in which they adopted a marketing campaign “to mislead

consumers into thinking that [JUUL devices] were benign smoking cessation devices, even

though [they were] never designed to break addictions.” In re JUUL Labs, 533 F. Supp. 3d at

866 (quoting SACAC 4 5); see id. at 870-74 (discussing allegations that JUUL MDL defendants

obscured JUUL products’ addictiveness and health risks); see also SACAC {ff 943, 949 (alleging

that Altria “transmitted false and misleading communications to the public and the federal

government, including Congress and the FDA, in an attempt to stave off regulation of the JUUL

product”). In this case, Judge Kessler found that defendants engaged in “deceptive marketing

and cigarette design modifications [that] exploit[ed] smokers’ desire for less hazardous and ‘low

tar’ cigarettes which Defendants knew to be no safer than full-flavor cigarettes.” United States

vy. Philip Morris USA, Inc., 449 F. Supp. 2d at 852-53; see also id. at 560 (finding that

defendants “extensively — and successfully — marketed and promoted their low tar/light cigarettes

as less harmful alternatives to full-flavor cigarettes”).

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Despite these clear parallels, defendants argue that interpreting Order #1015 to

apply to the JUUL MDL — a court action that does not involve conventional cigarettes - would

have “no logical stopping point” and might require defendants to produce discovery materials

from matters involving non-tobacco products, such as wine. Def. Opp. at 10. Such a “slippery

slope” argument is not persuasive. In resolving Intervenors’ motion for clarification, the Court

need not opine on the exact contours of Order #1015. Rather, the Court has concluded simply

that the JUUL MDL is a court action concerning “smoking and health, marketing, [and]

addiction” within the plain text of Order #1015. Defendants must upload their discovery

materials produced in the JUUL MDL to Philip Morris’s Internet Document Website. See Order

#1015 4 III.C.10.a.

B. Motion to Modify

A court “possess[{es] the jurisdiction and power to modify [an] original injunction

so as to effectuate its intended purpose and result.” 1250 24th St. Assocs. Ltd. P’ship v. Brown,

684 F. Supp. 326, 328 (D.D.C. 1988); see United States v. W. Elec. Co., 46 F.3d 1198, 1202

(D.C. Cir. 1995) (“The power of a court of equity to modify a decree of injunctive relief... is

long-established, broad, and flexible.” (quoting N.Y. State Ass’n for Retarded Child., Inc. v.

Carey, 706 F.2d 956, 967 (2d Cir. 1983))); see also 11A WRIGHT, MILLER & KANE, FEDERAL

PRACTICE AND PROCEDURE § 2961.° “[T]he standard for determining whether modification is

° Both parties suggest that Rule 60(b)(5) of the Federal Rules of Civil Procedure

provides the legal standard for resolution of the issue of modification. That rule provides: “On

motion and just terms, the court may relieve a party or its legal representative from a final

judgment, order, or proceeding” if, among other things, “applying [the injunction] prospectively

is no longer equitable.” FED. R. Civ. P. 60(b)(5) (emphasis added). Under that rule, “[{t]he party

seeking modification ‘bears the burden of establishing that a significant change in circumstances

warrants [the injunction’s] revision.’” Gov’t of Province of Manitoba v. Zinke, 849 F.3d 1111,

1117 (D.C. Cir. 2017) (quoting Rufo v. Inmates of Suffolk Cnty. Jail, 502 U.S. 367, 383 (1992)).

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appropriate is whether the purposes of the litigation as incorporated into the injunctive decree

have been fully achieved.” 1250 24th St. Assocs. Ltd. P’ship v. Brown, 684 F. Supp. at 328; see

United States v. United Shoe Machinery Corp., 391 U.S. 244, 252 (1968). The “essential inquiry

...is whether modification is necessary in order to fulfill the original purpose of [the Court’s]

injunctive order.” 1250 24th St. Assocs. Ltd. P’ship v. Brown, 684 F. Supp. at 329.

Intervenors ask the Court to require that defendants maintain the Internet

Document Website for at least twelve additional months after uploading the JUUL MDL

discovery materials onto the website so that the public may have sufficient time to review the

materials. See Mot. at 5 ¥ 13; Intervenors’ Br. at 8. Defendants’ obligation to maintain the

Internet Document Website was set to expire on September 1, 2021 and has so far been extended

only until this Court rules on the Intervenors’ Motion to Clarify. See Order #1015 { ITI-C.8;

Order #1021; Order #112 — Remand. To give effect to the Court’s conclusion that JUUL MDL

documents must be made available on defendants’ document website, the Court concludes that it

must modify Order #1015 to require the defendants to maintain the Internet Document Website

past its original expiration date. This extension is necessary to fulfill the “original purpose” of

Order #1015. See 1250 24th St. Assocs. Ltd. P’ship v. Brown, 684 F. Supp. at 329. Ifthe

Internet Document Website expiration date were not extended, the public would not be able to

access and review the JUUL MDL discovery materials to which they are entitled under Order

#1015, and the Court’s clarification of Order #1015 would be futile. The extension will apply

only to the JUUL MDL discovery materials. See Rufo v. Inmates of Suffolk Cnty. Jail, 502 U.S.

The Court concludes that Rule 60(b)(5) is inapplicable here because Intervenors do not seek

relief from an injunction but rather seek to extend the injunction’s application. See United States

v. W, Elec. Co., 46 F.3d at 1202 (noting that requests to relieve an enjoined party of an

injunction’s constraints comes within Rule 60(b)(5) whereas requests to “tighten the decree in

order to accomplish its intended result” fall within the court’s equitable discretion).

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at 391 (modification of an injunction should be “suitably tailored to the changed circumstance”

justifying modification); Mot. at 6 17. Defendants therefore will be required to maintain Philip

Morris’s Internet Document Website with respect to the JUUL MDL discovery materials for a

period of twelve months following the date that all such documents are published on the website.

UI. CONCLUSION

More than a decade after Judge Kessler found the defendants liable under RICO

for “engaging in a lengthy, unlawful conspiracy to deceive the American public about . . . the

addictiveness of nicotine,” United States v. Philip Morris USA, Inc., 449 F. Supp. 2d at 26,

Philip Morris and Altria once again found themselves defending against allegations that they

participated in a scheme to “defraud consumers” and “grow|] the market of nicotine-addicts”

through misleading marketing. In re JUUL Labs, Inc., 533 F. Supp. 3d at 861. Intervenors ask

the Court to clarify that the defendants are required to publish documents relating to the JUUL

MDL litigation on the Internet Document Website pursuant to Judge Kessler’s remedial order,

Order #1015. The Court concludes that the JUUL MDL “concern[s] smoking and health,

marketing, [and] addiction,” and documents produced in that litigation therefore must be made

available to the public on the Internet Document Website. Order #1015 4 III.C.10.a. A separate

Order consistent with this Opinion shall issue this same day.

O22 ZA

PAULL. FRIEDMAN ~

United States District Judge

SO ORDERED.

DATE: b\\a\ o>

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