6150: JOINT RESPONSE TO ORDER #54-REMAND 6/4/15

June 4, 2015 4:45 pm by Gene Borio

The PDF is Here

EXCERPT:

the answer is No: The FTC action does not in any way affect the information and assurances given to the Court at the May 19 hearing. In fact, the information and assurances provided to the Court, both with the April 30 filings and during the May 19 hearing, were in anticipation of the FTC’s action and are fully consistent with it. . . .

Because the parties to the transaction intend to proceed expeditiously to closing upon receipt of
this Court’s approval, RJRT, LTC, and ITG Brands, LLC, respectfully request that the Court
grant the pending (Proposed) Unopposed Order (Dkt. No. 6142-1, filed April 30, 2015), as soon
as possible. No other party objects to this request.

END EXCERPT

FULL TEXT:

Case 1:99-cv-02496-GK Document 6150 Filed 06/04/15 Page 1 of 5

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

)
UNITED STATES OF AMERICA, )
Plaintiff, ) Civil Action No. 99-2496 (GK)
)
and )

)
TOBACCO-FREE KIDS ACTION FUND, )
et al., )
Plaintiff-Intervenors, )
)

v.
)
) Next Scheduled Court Date:
PHILIP MORRIS USA INC., et al., ) None
Defendants, )
)
and )
)
ITG BRANDS, LLC, )
COMMONWEALTH BRANDS, INC., )
AND COMMONWEALTH-ALTADIS, )
INC., )

(Proposed) Post-Judgment Parties )
Regarding Remedies. )
__________________________________________)

JOINT RESPONSE TO ORDER #54-REMAND

On Tuesday, May 26, 2015, the Federal Trade Commission (“FTC”) took action with
regard to the transaction between Reynolds American Inc. (ultimate parent of Defendant R. J.
Reynolds Tobacco Company (“RJRT”)) and Lorillard, Inc. (parent of Defendant Lorillard
Tobacco Company (“LTC”)). In this Court’s Order #54-Remand, the Court instructed the parties
“to file Statements as to whether the FTC’s action in any way affects the information and
assurances given to the Court at the May 19, 2015 hearing,” (Dkt. No. 6146, filed May 27,

Case 1:99-cv-02496-GK Document 6150 Filed 06/04/15 Page 2 of 5

2015); that hearing was on the pending Unopposed Motion for an Order Authorizing Transfer of
Certain Cigarette Brands and Businesses to ITG Brands, LLC, Pursuant to Order #1015,
Paragraph 20 (Dkt. No. 6142, filed April 30, 2015).

Those parties (and proposed post-judgment parties regarding remedies) submitting this
joint filing1 agree that the answer is No: The FTC action does not in any way affect the
information and assurances given to the Court at the May 19 hearing. In fact, the information
and assurances provided to the Court, both with the April 30 filings and during the May 19
hearing, were in anticipation of the FTC’s action and are fully consistent with it.2

As counsel for RJRT and ITG Brands explained at the May 19 hearing, now that the FTC
has acted, this Court’s approval is the principal closing condition that remains outstanding.3

1 This filing is submitted by Plaintiffs the United States and the Public Health
Intervenors; Defendants RJRT and LTC; and (Proposed) Post-Judgment Parties Regarding
Remedies ITG Brands, LLC, Commonwealth Brands, Inc., and Commonwealth-Altadis, Inc.
Defendants Philip Morris USA Inc. and Altria Group, Inc. filed a separate response. (Dkt. No.
6149, filed June 1, 2015).

2 The FTC Decision and Order compels the transferred brands to be divested in
accordance with the Asset Purchase Agreement and related agreements. In re Reynolds
American Inc. and Lorillard, Inc., Docket No. C-141-0168, § II(A) at 10, 2015 WL 3477677
(FTC Decision & Order, May 26, 2015) (“public record version”) (“On the Acquisition Date,
Respondent Reynolds shall divest the Combined Cigarette Business, absolutely and in good
faith, to Imperial, pursuant to, and in accordance with, the Imperial Divestiture Agreement”)
(emphasis added). The “public record version” of the Decision and Order is available at
www.ftc.gov/system/files/… (last visited June 3,
2015). “Imperial Divestiture Agreement” is defined to mean the Asset Purchase Agreement and
related agreements. Id. § I(Q) at 7. Those Agreements are among the exhibits submitted to this
Court in support of the Unopposed Motion (see Dkt. Nos. 6143-1 & 6143-2, both filed April 30,
2015), and undersigned counsel have reviewed them.

3 Under the terms of the FTC Decision and Order, the proposed merger may go forward
at this time, but as a formal matter, the FTC will not issue its final decision and order until after a
thirty-day period for public comment. RJRT, LTC, and the (Proposed) Post-Judgment Parties
Regarding Remedies urge (and Plaintiffs have no objection) this Court to authorize the brand
transfer without waiting for the end of the comment period or the FTC’s final decision, as the

Footnote continues on next page

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Case 1:99-cv-02496-GK Document 6150 Filed 06/04/15 Page 3 of 5

Because the parties to the transaction intend to proceed expeditiously to closing upon receipt of
this Court’s approval, RJRT, LTC, and ITG Brands, LLC, respectfully request that the Court
grant the pending (Proposed) Unopposed Order (Dkt. No. 6142-1, filed April 30, 2015), as soon
as possible. No other party objects to this request.

Dated: June 4, 2015 Respectfully submitted,

/s/ Noel J. Francisco
Noel J. Francisco (D.C. Bar No. 464752)
Peter J. Biersteker (D.C. Bar No. 358108)
JONES DAY
51 Louisiana Avenue, N. W.
Washington, D.C. 20001-2113
Telephone: (202) 879-3939
Fax: (202) 626-1700

Geoffrey K. Beach
WOMBLE CARLYLE SANDRIDGE & RICE, PLLC
One West Fourth Street
Winston-Salem, NC 27101
Telephone: (336) 721-3600
Facsimile: (336) 733-8389

Attorneys for Defendant R. J. Reynolds Tobacco Company

/s/ Michael B. Minton
Michael B. Minton

A. Elizabeth Blackwell
THOMPSON COBURN LLP
One U.S. Bank Plaza, Suite 3500
St. Louis, MO 63101-1693
Footnote continued from previous page

FTC Decision and Order contemplates the parties closing prior to final agency action. In the
extremely unlikely event that the FTC amends the Decision and Order, further proceedings might
be necessary before this Court to address the transfer of these brands.

3

Case 1:99-cv-02496-GK Document 6150 Filed 06/04/15 Page 4 of 5

Telephone: (314) 552-6000
Facsimile: (314) 552-7597

Attorneys for Defendant Lorillard Tobacco Company

/s/ Robert J. Brookhiser
Robert J. Brookhiser, Jr. (D.C. Bar No. 202168)
Elizabeth B. McCallum (D.C. Bar No. 451361)
BAKER & HOSTETLER LLP
Washington Square, Suite 1100
1050 Connecticut Avenue, NW
Washington, DC 20036-5304
Telephone: 202-861-1500
Facsimile: 202-861-1783

Attorneys for (Proposed) Post-Judgment Parties
Regarding Remedies ITG Brands, LLC,
Commonwealth Brands, Inc. and
Commonwealth-Altadis, Inc.

Benjamin C. Mizer
Principal Deputy Assistant Attorney General

Michael Blume, Director
Andrew Clark, Assistant Director
Consumer Protection Branch

/s/ Daniel K. Crane-Hirsch
Daniel K. Crane-Hirsch, Trial Attorney
Civil Division
UNITED STATES DEPARTMENT OF JUSTICE

P.O. Box 386
Washington, D.C. 20044-0386
Telephone: (202) 616-8242
Fax: (202) 514-8742
Attorneys for Plaintiff United States of
America

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Case 1:99-cv-02496-GK Document 6150 Filed 06/04/15 Page 5 of 5

/s/ Howard M. Crystal
Howard M. Crystal (D.C. Bar No. 446189)
Katherine A. Meyer (D.C. Bar No. 244301)
MEYER GLITZENSTEIN & CRYSTAL
1601 Connecticut Avenue, Suite 700
Washington, DC 20009
202-588-5206
hcrystal@meyerglitz.com

Attorneys for the Public-Health
Plaintiff-Intervenors

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