Federal Trade Commission et al v. Quincy Bioscience Holding Company, Inc. et al

Filing 127

OPINION & ORDER that the objections made at the Lerner depositions on August 6and 7 are sustained. The FTC's April 10, 2020 motion to compel production of documents identified in the Dec. 11, 2019 GES subpoena is denied, and the subpoena is quashed. (Signed by Judge Louis L. Stanton on 9/9/2020) (ml)

Case
DORI GINJ.\f 1:17-cv-00124-LLS

Document 127 Filed 09/09/20 Page 1 of 5

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
FEDERAL TRADE COMMISSION and
THE PEOPLE OF THE STATE OF NEW YORK,
by LETITIA JAMES, Attorney General
of the State of New York,

Plaintiffs ,

17 Civ . 124 (LLS)
20 MC 0307 (LLS)
OPINION & ORDER

- against QUINCY BIOSCIENCE HOLDING COMPANY,
INC., a corporation;
QUINCY BIOSCIENCE, LLC, a limited
liability company;
PREVAGEN, INC ., a corporation d/b/a/
Sugar River Supplements;
QUINCY BIOSCIENCE MANUFACTURING,
LLC, a limited liability company;
and
MARK UNDERWOOD, individually and as
an officer of Quincy Bioscience
Holding Company, Inc., Quincy
Bioscience, LLC, and Prevagen, Inc.;

Defendants .
The core scientific research about which the issues in this
case revolve is the 2009 - 2011 Madison Memory Study , about
which the discovery has been abundant .

Its results were

published on-line in 2011 , and all unprivileged data underlying
it was furnished to the FTC years ago .
Now in issue are more recent opinions and advice given to
Quincy by a non - party , non - testifying expert Quincy retained in
2016 , when the bringing of this case became apparently

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Case 1:17-cv-00124-LLS Document 127 Filed 09/09/20 Page 2 of 5

inevitable .

Georgetown Economic Services

F . R . Civ . P . Rule 26(b) (4) (D)
Trial Preparation .

( " GES " ) is what

calls an Expert Employed Only for

It is not a party , will not testify , and was

retained only to consult confidentially with Quincy ' s counsel in
preparation of the defense of this and other anticipated and
pending litigation .

GES independently analyzed the Madison

Memory Study in a reappraisal a Quincy employee used in drafting
a manuscript regarding the study (the Lerner Manuscript ) .

Both

the reappraisal and the Lerner Memorandum have long since been
disclosed to the FTC .

The FTC claims that those disclosures by Quincy waived the
protection Fed . Rules of Civil Proc . Rule 2 6 (b) ( 4) ( D) gives to
the work of such an expert engaged in aiding the preparation for
trial :

Ordinarily , a party may not , by interrogatories or
deposition , discover facts known or opinions held by an
expert who has been retained or specially employed by
another party in anticipation of litigation or to prepare
for trial and who is not expected to be called as a witness
at trial .
But a party may do so only :
(i)

[in connection with the report of a court ordered physical or mental examination] ; or

(ii)

on showing exceptional circumstances under
which it is impracticable for the party to
obtain facts or opinions on the same subject by
other means .

The FTC contends that Quincy ' s disclosures of that material
to it constituted an involuntary "subject matter waiver" and

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Case 1:17-cv-00124-LLS Document 127 Filed 09/09/20 Page 3 of 5

that now the FTC is entitled , as a matter of fairness , to " all
documents relating to GES ' s clinical study work for Defendants
and , most critically , to all of the analyses GES performed on
the Madison Memory Study ." (FTC ' s May 22 , 2020 brief in the
District of Columbia , p . 8)

That is intended to include all

GES ' s communications of fact and opinion to Quincy on the
subject from 2016 to date.

The FTC argues that Quincy should

not be allowed to pick and choose , to disclose only what favors
it but to withhold what might be unfavorable ; and that the "FTC
is entitled to discovery of those documents as a matter of
fairness to put the disclosed GES results in proper context ."
Id ., p.

13 .

Those familiar broad principles have considerable equitable
appeal , and are frequently employed in managing discovery issues
in the general run of cases .

However , they are less useful in

the special case , which is particularly addressed by Rule
26(b) (4) (D) , of a non - witness expert hired by one side for the
sole purpose of assisting with its trial preparation.

The subject matter of this litigation is the Madison Memory
Study , and a waiver of protection with regard to that "subject
matter " would include all or most of the case .

There is no

indication that when Quincy gave the FTC the data underlying the
Study , it intended to later be required to disclose to the FTC

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Case 1:17-cv-00124-LLS Document 127 Filed 09/09/20 Page 4 of 5

the facts or opinions of non - testimonial experts on the subject
whom it consulted thereafter in preparing for trial .

The FTC has accurately described this case as a
" straightforward , stand- alone law enforcement action brought by
Plaintiffs , the FTC and the People of the State of New York , to
challenge Defendants ' conduct in connection with their marketing
and sale of Prevagen for purported memory and other cognitive
benefits ."

Id . p . 20 .

There are no exceptional circumstances

shown to exempt this case from the Rule which exactly applies to
it .

The FTC has all the data underlying the study , the GES

reappraisal and the Lerner Manuscript .

It has had , and still

has , ample time to gather experts ' advice on the subject .

Rule 26 (b) (4) (D) was enacted to support the values of
attorney work - product , client confidences , and privacy of trial
preparation .

There is no basis or need for an intrusion into those
values and Quincy ' s preparation of facts and opinions in this
case .

The FTC can " obtain facts or opinions on the same subject

by other means ."

(Rule 26 (b) (4) ( D) (ii ) ) .

The objections made at the Lerner depositions on August 6
and 7 are sustained .

The FTC ' s April 10, 2020 motion to compel

production of documents identified in the Dec . 11, 2019 GES

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Case 1:17-cv-00124-LLS Document 127 Filed 09/09/20 Page 5 of 5

subpoena is denied , and the subpoena is quashed .
So ordered .
Dated :

New York , New York
September 9 , 2020

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L .. j ~

LOUIS L . STANTON
U. S . D. J .

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