R.J. REYNOLDS TOBACCO COMPANY et al v. UNITED STATES FOOD AND DRUG ADMINISTRATION et al

Filing 16

Memorandum in opposition to re 14 MOTION for Order To Establish Briefing Schedule filed by COMMONWEALTH BRANDS INCORPORATED, LIGGETT GROUP LLC, LORILLARD TOBACCO COMPANY, R.J. REYNOLDS TOBACCO COMPANY, SANTA FE NATURAL TOBACCO COMPANY, INC.. (Attachments: # 1 Text of Proposed Order)(Francisco, Noel)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
R.J. REYNOLDS TOBACCO COMPANY,
LORILLARD TOBACCO COMPANY,
COMMONWEALTH BRANDS, INC.,
LIGGETT GROUP LLC, and SANTA FE
NATURAL TOBACCO COMPANY, INC.,

Civil Action No. 11-01482 (RCL)

Plaintiffs,
v.
UNITED STATES FOOD AND DRUG
ADMINISTRATION, MARGARET
HAMBURG, Commissioner of the United
States Food and Drug Administration, and
KATHLEEN SEBELIUS, Secretary of the
United States Department of Health and
Human Services,
Defendants.
PLAINTIFFS’ OPPOSITION TO DEFENDANTS’
MOTION TO ESTABLISH BRIEFING SCHEDULE
On August 19, 2011, Plaintiffs filed a Motion for Summary Judgment on their claim that
FDA’s recent regulation requiring shocking and disturbing graphic warnings on all cigarette
packaging and advertising violates the First Amendment and was promulgated in violation of the
Administrative Procedure Act (“APA”). Dkt. No. 10 (“SJ Motion”) (challenging FDA, Required
Warnings for Cigarette Packages and Advertisements, 76 Fed. Reg. 36,628 (June 22, 2011) (“the
Rule”)). At the same time, Plaintiffs also filed a Motion for Preliminary Injunction pursuant to 5
U.S.C. § 705 and Federal Rule of Civil Procedure 65, in which they seek a short postponement
of the effective date of the Rule and the related labeling requirements tied to the effective date of
the Rule. Dkt. No. 11 (“PI Motion”)). On August 22, 2011, Defendants filed a motion
proposing a briefing schedule for Plaintiffs’ PI Motion and the parties’ dispositive motions. See

Dkt. No. 14 (“Extension Motion”). As explained below, the schedule proposed by Defendants is
facially unreasonable and would cause irreparable injury to Plaintiffs, and should therefore be
rejected by this Court. Instead, the Court should adopt Plaintiffs’ proposed briefing schedule,
which itself significantly extends the time Defendants have to respond while avoiding the
unjustified imposition of irreparable harm on Plaintiffs.
1. Plaintiffs face irreparable injury absent a preliminary injunction: As explained in
Plaintiffs’ PI Motion (pp. 14-17), it will take Plaintiffs more than a year of vigorous efforts, at a
cost of millions of dollars, to redesign, order, install and test equipment capable of printing the
new warnings in the colors and styles required by the Rule. Indeed, Congress provided for a 15month implementation period of the Rule, and FDA “agree[d] this is an appropriate amount of
time for implementation.” 76 Fed. Reg. at 36,703. It is likewise clear that Plaintiffs cannot risk
disregarding the Rule until there is greater legal certainty about its validity. As a practical matter,
this means that Plaintiffs cannot wait for this Court to rule on their summary judgment motion
before beginning to prepare their new packaging. Therefore, unless the effective date of the new
warnings is enjoined until 15 months after this Court rules on the merits of Plaintiffs’ claims,
Plaintiffs will be forced to spend millions of dollars and thousands of employee-hours, which
would be irretrievably lost if, as is likely, Plaintiffs prevail on their ultimate claims. See Smoking
Everywhere, Inc. v. FDA, 680 F. Supp. 2d 62, 77 n.19 (D. D.C. 2010) (holding that economic
injury caused by FDA’s APA violation is irreparable “because plaintiffs cannot recover money
damages against FDA”) (Leon, J.). Conversely, given the unhurried pace at which Congress and
FDA acted to implement the new warnings, as well as FDA’s findings that the Rule will produce
minimal or no benefits, it is clear that a brief delay in implementation of the Rule will cause no
harm to the interests of the Government or the public.

-2-

2. Motions for preliminary injunctions must be resolved on an expedited basis: This
case presents precisely the situation in which 5 U.S.C. § 705, the Federal Rules of Civil
Procedure, the Local Rules, and basic principles of equity call for the issuance of prompt
preliminary relief to avoid irreparable injury. Under 5 U.S.C. § 705, a court reviewing agency
action is explicitly authorized to “postpone the effective date of an agency action or to preserve
status or rights pending conclusion of the review proceedings.” (Emphasis added.) Likewise,
Federal Rule of Civil Procedure 65 as well as Local Civil Rule 65.1 both recognize the courts’
power to issue preliminary injunctions in a case prior to a determination of the ultimate merits.
This authority is derived from an “equity practice with a background of several hundred years of
history,” Fed. Trade Comm’n v. Weyerhaeuser Co., 665 F.2d 1072, 1084 (D.C. Cir. 1981), under
which courts have traditionally had the power to issue injunctive relief on an expedited basis
where necessary to avoid irreparable injury prior to adjudicating the ultimate merits. Indeed,
Local Rule 65.1(c) reflects the expedited nature of the preliminary injunction process by
providing that “[t]he opposition [to a motion for preliminary injunction] shall be served and filed
within seven days after service.” LCvR 65.1(c). Likewise, Local Rule 65.1(d) sets out a
presumptive rule that “a hearing on an application for preliminary injunction shall be set by the
court no later than 21 days after its filing” and allows the Court to refuse to hear live witness
“where the need for live testimony is outweighed by considerations of undue delay.” LCvR
65.1(d).
3. The extension sought by Defendants is facially excessive and unjustified: In their
Motion To Establish Briefing Schedule, however, Defendants seeks to extend the 7-day period
called for under the Local Rules to 60 days. Extension Motion at 3. Defendants thus seek to file
their opposition to Plaintiffs’ request for preliminary relief at the same time they seek to file their

-3-

opposition to Plaintiffs’ request for final relief. Under this schedule, the Court could not
reasonably be expected to rule on Plaintiffs’ motion for preliminary relief before January 2012,
four and a half months after it was filed.
Adopting Defendants’ proposed schedule would effectively deny Plaintiffs’ motion for a
preliminary injunction, because it would require that Plaintiffs suffer millions of dollars of
irreparable harm before this Court issues a ruling. Indeed, Plaintiff R.J. Reynolds alone plans to
spend over $4 million between November, 2011 and January, 2012 in order to meet the current
effective date of September 22, 2012. See PI Motion, Exhibit 5, Declaration of J. Brice O’Brien
¶¶ 9-12. Plaintiffs Lorillard Tobacco Company, Commonwealth Brands, Inc., Liggett Group
LLC, and Santa Fe Natural Tobacco Company similarly plan to expend significant amounts of
money in unrecoverable compliance costs. See generally Declaration of Stephen Klepper;
Declaration of Victor D. Lindsley, III; Declaration of William Melton; Declaration of Gregory A.
Sulin; Declaration of David D. Depalma.
Defendants do not dispute these costs, but instead argue that the extraordinary extension
they seek is justified by “Plaintiffs’ delay” and because simultaneous briefing is “more efficient.”
Extension Motion at 4. Neither argument is well founded: Plaintiffs have left more than
adequate time for briefing on their PI motion and delaying the adjudication of preliminary relief
until final judgment will result in the unnecessary expenditure of millions of dollars.
First, Defendants note that some of the Plaintiffs in this action briefed “arguments similar
to those made here” in their 2009 challenge to various provisions of the Tobacco Control Act. Id.
at 2 (citing Commonwealth Brands, Inc. v. United States, 678 F. Supp. 2d 512 (W.D. Ky. 2010)).
Defendants then argue that, in light of their familiarity with the general legal issues at stake in
this case, Plaintiffs unduly delayed by not filing their complaint more quickly after publication of

-4-

the Rule. Id. at 1-2. As an initial matter, it is of little relevance that some of the Plaintiffs here
were also parties in the Commonwealth Brands case. The plaintiffs in Commonwealth Brands
argued that the Act’s general warnings requirement was facially unconstitutional, but they did
not raise the claim brought by Plaintiffs here—that the particular warnings selected by the Rule
are unconstitutional as applied. Nor could they have raised such a claim, as the Rule had not yet
been promulgated when that case was filed. As demonstrated by Plaintiffs’ Summary Judgment
Motion, which turns almost exclusively on the findings and and requriements of FDA’s Rule,
Plaintiffs’ claims in this action arise from factual predicates and a legal context that simply did
not exist in the Commonwealth Brands case.
Plaintiffs’ timing, moreover, was eminently reasonable and provides the court and
Defendants with more than adequate time to resolve their PI motion. The Rule at issue in this
case occupies 149 pages of the Federal Register and extensively cites complex social science
research and economic analysis. See 76 Fed. Reg. 36,628-67,777. Although Defendants may be
intimately familiar with the Rule, Plaintiffs could of course not fully analyze it until it was
published. As FDA itself noted, although “manufacturers have known this rule was coming, in
some form, since the passage of the [Act], it is only with the publication of the final rule that
they . . . [knew] its exact form.” 76 Fed. Reg. at 36,716. Plaintiffs acted promptly to file this
case after publication of the Rule and have left adequate time for the Court to decide their
preliminary injunction motion. Indeed, Plaintiffs have always been willing to agree to a briefing
schedule that would provide the Government three times the normal period to file its opposition
to their PI motion. Consequently, Defendants have more than ample time to address the issues
raised therein.

-5-

Second, Defendants argue that their briefing schedule will be “more efficient” because
Plaintiffs’ PI Motion will turn in part on the ultimate merits of Plaintiffs’ claims. Extension
Motion at 4. This is plainly wrong, since it would require Plaintiffs to unnecessarily expend
millions of dollars that can never be recouped. And it would do this where the record is clear
that a short delay in the Rule will have zero impact on public health. This is a definition of
“efficiency” that only the Government could adopt. Moreover, it is contrary to the recognized
need to act expeditiously on motions for preliminary injunctions in order to avoid irreparable
harm. After all, every motion for a preliminary injunction turns in part on the merits of the
movant’s ultimate claim. Thus, every motion for a preliminary injunction involves the type of
“inefficiency” cited by the Government. That is obviously no basis to delay adjudication of
preliminary injunctions until final adjudication of the merits, because the paramount
“inefficiency” that the law recognizes is the irreparable harm caused by failure to adjudicate such
issues quickly. Cf. Weyerhaeuser, 665 F.2d at 1083 (“The determination of a likelihood of
success must be made under time pressure and on incomplete evidence.”). Indeed, the very
premise of the preliminary injunction process is that preliminary relief will be decided before the
ultimate merits.
The briefing schedule sought by the Government would deprive Plaintiffs of the very
relief they seek in their PI Motion by forcing them to incur millions of dollars in costs that would
be irretrievably wasted if, as is likely, the Court were to invalidate the Rule. If Defendants
disagree with the substance of Plaintiffs’ PI motion, they may voice that disagreement in their
Opposition and allow the Court to grant or deny preliminary relief while there is still time to
avoid irreparable injury to Plaintiffs. But Defendants should not be allowed to deny Plaintiffs
preliminary equitable relief simply by running out the clock through a briefing schedule.

-6-

4. Plaintiffs’ proposed schedule: In light of the foregoing, Plaintiffs respectfully request
the following PI briefing schedule:
•

September 9, 2011 (21 days after Plaintiffs’ Motion): Defendants’ Opposition to
Plaintiffs’ Motion for Preliminary Injunction.

•

September 23, 2011 (14 days after Defendants’ Opposition): Plaintiffs’ Reply in
Support of Plaintiffs’ Motion for Preliminary Injunction.

If the Court agrees, then Plaintiffs do not object to Defendants’ proposed schedule for SJ.
However, if the Court disagrees and wishes to set a combined schedule, then Plaintiffs submit
that, absent preliminary relief, the Government’s proposal unnecessarily delays resolution of the
case, inflicting unnecessary and irreparable injury on Plaintiffs. Therefore, if the Court rejects
Plaintiffs’ request for preliminary briefing on their PI Motion, Plaintiffs alternatively propose the
following deadlines, which already reflect substantial extensions beyond the default briefing
periods set forth in Local Rule 7 for summary judgment motions and Local Rule 65.1 for
preliminary injunction motions:
•

September 19, 2011 (30 days after Plaintiffs’ Motions): Defendants’ consolidated
response to Plaintiffs Motion for Preliminary Injunction and Motion for Summary
Judgment; Defendants’ Cross-Motion for Summary Judgment; Administrative
Record.

•

October 10, 2011 (21 days after prior briefing): Plaintiffs’ consolidated reply in
support of their motions and opposition to Defendants’ Cross-Motion for
Summary Judgment.

•

October 24, 2011 (14 days after prior briefing): Government’s Reply in Support
of Defendant’s Cross-Motion for Summary Judgment.
Conclusion

For the foregoing reasons, Plaintiffs respectfully request that the Court deny in part and
grant in part Defendants’ Motion To Establish Briefing Schedule and enter the Proposed Order
provided herewith.

-7-

Respectfully Submitted,

Dated: August 22, 2011

/s/ Noel J. Francisco________________
Noel J. Francisco (D.C. Bar No. 464752)
Geoffrey K. Beach (D.C. Bar No. 439763)
Warren Postman (D.C. Bar No. 995083)

Floyd Abrams (admitted pro hac vice)
Joel Kurtzberg (admitted pro hac vice)
Kayvan Sadeghi (admitted pro hac vice)

JONES DAY
51 Louisiana Avenue, NW
Washington, D.C. 20001-2113
Telephone: [phone]
Facsimile: [phone]
[e-mail]
[e-mail]
[e-mail]

CAHILL GORDON & REINDEL LLP
80 Pine Street
New York, NY 10005-1702
Telephone: [phone]
Facsimile: [phone]
[e-mail]
[e-mail]
[e-mail]
-and-

Counsel for Plaintiff R.J. Reynolds and
Santa Fe Natural Tobacco Company

Philip J. Perry (D.C. Bar No. 434278)
LATHAM & WATKINS LLP
555 11th Street, NW, Suite 1000
Washington DC 20004-1304
Telephone:[phone]
Facsimile: [phone]
[e-mail]

Counsel for Plaintiff Commonwealth
Brands, Inc.

Patricia A. Barald (D.C. Bar No. 218016)
Scott D. Danzis (D.C. Bar No. 481426)
COVINGTON & BURLING LLP
1201 Pennsylvania Avenue, NW
Washington, DC 20004-2401
Telephone: [phone]
Facsimile: 202.662.6291
[e-mail]
[e-mail]
Counsel for Plaintiff Lorillard
Tobacco Company

Jonathan D. Hacker (D.C. Bar No. 456553)
O’MELVENY & MYERS LLP
1625 Eye Street, NW
Washington, D.C. 20006-4061
Telephone: [phone]
Facsimile: [phone]
[e-mail]
Counsel for Plaintiff Liggett Group LLC
-8-