ATTACHMENT 4
Joshua G. Hamilton Direct Dial: + 1.424.653.5509 joshua.hamilton@lw.com 355 South Grand Avenue, Suite 100 Los Angeles, California 90071-1560 Tel: +1.213.485.1234 Fax: +1.213.891.8763 www.lw.com LATHAM&WATKI N SLLP BY EMAIL Carmel, Milazzo & DiChiara, LLP 261 Madison A venue, 9th Floor New York, NY 10016 (646) 838-1311 cmilazzo@cmdllp.com FIRM/ AFFILIATE OFFICES Barcelona Moscow Beijing Munich Boston New York Brussels Orange County Century City Paris Chicago Riyadh Dubai Rome Dusseldorf San Diego Frankfurt San Francisco Hamburg Seoul Hong Kong Shanghai Houston Silicon Valley London Singapore Los Angeles Tokyo Madrid Washington, D.C. Milan Re: DB Dava LLC's First Set of Requests for the Production of Documents Dear Mr. Milazzo, Provision Interactive Technologies, Inc. v. DB Dava LLC et al. (Index No. 656127/2016) We write on behalf of DB Dava LLC ("DB Dava") in reference to our June 29, 2017 requests for the production of documents (the "RFPs") and the document productions made by Provision Interactive Technologies, Inc. ("Provision") on August 10 and September 15, 2017 (collectively, the "Document Productions"). Provision's Document Productions are woefully inadequate and reflect the lack of Provision's transparency that has plagued the parties' relationship. As a threshold matter, Provision failed to produce critical correspondence with Rite Aid. Rite Aid's recent production in response to DB Dava' s subpoena demonstrates that Provision concealed such correspondence from DB Dava for a significant period of time. In addition, for more than half of the RFPs, Provision has produced no documents at all. Where Provision has produced some limited categories of documents, the Document Productions are manifestly incomplete, including only a small number of responsive documents or otherwise containing substantial gaps. Despite DB Dava's good faith in extending the Document Productions' deadline from July 19, 2017 to September 15, 2017, Provision has fallen far short of its obligations under the CPLR and Commercial Division Rules and acted inconsistently with its own representations during the September 7, 2017 meet-and-confer call (the "September 7 Meet and Confer"). The deficiencies in the Document Productions are only part of Provision's shortcomings. As we explained in our letter of August 31, 2017 ( the "August 31 Letter") and again during the September 7 Meet and Confer, Provision's written responses to the RFPs (the "RFP Responses") are deficient in numerous respects. Based on the September 7 Meet and Confer, we understand that Provision intends to revise its RFP Responses in a manner consistent with
Page2 LATHAM&WATKI NSLLP Section II below, and we ask that you provide those amended RFP Responses not later than Friday, September 29, 2017. Provision's failure to meet its obligations and commitments is a serious matter, and, absent prompt correction, DB Dava will have no choice but to raise these issues with the Court. More than two weeks have passed since the parties met and conferred, but Provision has still not amended the RFP Responses or identified any documents that were withheld (as required by law). 1 And nearly three months have passed since DB Dava served its RFPs, but Provision has provided only a smattering of documents responding to only a small fraction of the RFPs. It is unfortunate that the ample good faith DB Dav a has shown in accommodating Provision's production timeline has not been reciprocated. Nevertheless, we are hopeful that these issues can be resolved quickly and informally between the parties, and to that end, we ask that Provision immediately proceed to rectify the inadequacies detailed below in Section I ( concerning the Document Productions) and Section II (concerning the RFP Responses). If a prompt resolution is not forthcoming, we intend to request a discovery conference with the Court at the earliest available opportunity. I. PROVISION'S DOCUMENT PRODUCTIONS ARE INCOMPLETE As you know, the Document Productions were originally due 20 days after service of the RFPs - i.e., no later than July 19, 2017. However, as a courtesy, DB Dava agreed to Provision's request to extend that deadline by nearly two months to September 15, 2017, by which time Provision was required to complete the Document Productions. Provision's Document Productions are manifestly incomplete. As detailed below, many of the documents that Provision produced were already in DB Dava's possession or were publicly available, the few documents that Provision actually did produce contain substantial gaps, and the vast majority of DB Dava's RFPs remain completely unanswered by any responsive document. A. Summary of Provision's Incomplete Document Productions Provision made its Document Productions in two phases. First, Provision produced bates range P000001-P000140 on August 10, 2017, which included the following documents: The ProDava LLC Agreement and the Location Agreement; Provision's correspondence requesting funding in 2016; A single ProDava account statement for March 18, 2016 through June 30, 2016; Various press releases issued by Provision in 2016; 22 NYCRR 202.70, Rule 11-e(b); CPLR 3122(b). 2
September 25, 201 7 Page 3 LATHAM&WATKI NSLLP A spreadsheet that appears to list kiosk installation locations. Most of the documents produced on August 10 had already been provided in this litigation or were otherwise already in DB Dava's possession. Provision made its second Document Production on September 15, 2017 - the last possible day- when it produced bates range P000140-P000695. Those documents included: Charts and other documents reflecting 3D kiosk maintenance issues; Redemption reports for a limited number of months in 2016; Session reports for some but not all months in 2016 and 2017; Coupon reports for 2017 and limited dates in 2016; Emails between Provision and Rite Aid on various topics, including emails from 2014, 2016, and one email chain from 2012, but no emails from 2015 or 2017. Although DB Dava's review of the September 15, 2017 Document Production is ongoing, it is already apparent that the foregoing categories of documents contain substantial gaps. The RFPs sought documents dated between December 1, 2013 and the present, but Provision has produced no redemption reports, session reports, or coupon reports created before 2016, no redemption reports or advertiser-specific coupon reports from 2017, 2 and no correspondence between Provision and Rite Aid from 2015 or 2017. Provision's failure to produce documents continues its pattern of hiding information that has plagued the parties' relationship. For example, Provision again has not produced a complete set of redemption reports, session reports, and coupon reports, despite the fact that DB Dava is entitled to this information under the parties' agreements and previously requested these reports more than four months ago, in our letter of May 17, 2017. 3 That letter predates the RFPs, and Provision (contrary to its obligations under the parties' agreements) never even responded to it. Provision's patently incomplete production of redemption reports, coupon reports, and session reports (and total failure to produce the monthly performance reports and advertising reports that 2 As is apparent from the Document Productions, coupon reports come in two varieties: "summary" coupon reports (which contain information regarding the total number of coupons printed across all brands at all kiosks for certain time periods) and "advertiser-specific" coupon reports (which contain information regarding the time and location of coupon distribution for certain brands). The Document Productions appear to include summary coupon reports for every month in 2017, and some (but not all) months in 2016. Moreover, the Document Productions include only a small number of advertiser-specific coupon reports from early 2016 for a handful of brands. As noted above, Provision has not produced a single coupon report from 2014-15. 3 See, e.g., LLC Agreement 9.5; PSA 1 and 7. 3
Page4 LATHAM&WATKI NSLLP DB Dava's May 17, 2017 letter also requested) does not comply with Provision's duties under the agreements or the requirements of the CPLR. Provision's partial production of communications with Rite Aid is equally improper. Those documents hold great significance for this litigation, and it is difficult to imagine a good faith reason why Provision withheld them from its Document Productions. Nor has Provision explained its omission of any correspondence with Rite Aid in 2015 and 2017. In addition to the gaps in production described above, the Document Productions are deficient for multiple other reasons. At most, Provision's Document Productions respond (only partially) to 10 of DB Dava' s 32 RFPs, specifically: RFP No. 1, seeking communications between Provision and any party other than DB Dava regarding the sale of advertising on 30 kiosks. Provision has produced only limited correspondence with a single third party - Rite Aid - and has therefore failed to respond to this RFP in full, as required. RFP No. 3, seeking communications between Provision and Rite Aid regarding the 30 kiosks. As discussed above, Provision's Document Productions are manifestly incomplete in this regard. RFP No. 4, seeking maintenance reports and other technical support information regarding the 30 kiosks. As explained in DB Dava's August 31 Letter, the documents sought by this RFP include field reports concerning kiosk maintenance issues, which Provision has failed to produce. RFP No. 7, seeking information regarding the location of the 30 kiosks' installation. DB Dava's review of the Document Productions is ongoing, but it appears that Provision has produced documents responsive to this RFP. RFP No. 10, seeking contracts for the placement of 30 kiosks' in large retail stores. Apart from the Location Agreement with Rite Aid, which was already in DB Dava's possession and part of the record in this case, Provision has produced no responsive documents. RFP Nos. 16-20, seeking monthly performance reports, redemption reports, advertising reports, session reports, and coupon reports. As discussed above, Provision's Document Productions are manifestly incomplete in this regard, containing partial sets of redemption reports, session reports, and coupon reports, and no monthly performance reports or advertising reports. In sum, Provision has failed to produce a complete set of documents that are responsive to any of the RFPs - with the possible exception of RFP No. 7. 4 Meanwhile, as discussed immediately 4 Although the Document Productions do not appear to contain any obvious gaps with respect to RFP No. 7, DB Dava's review is ongoing. Moreover, as noted in Section II.A. below, 4
Pages LATHAM&WATKI N 5LLP below, Provision has not produced a single responsive document for the vast majority of the RFPs. B. Provision Produced No Documents in Response to the Majority of the RFPs For 17 out of the 32 RFPs, Provision produced no responsive documents whatsoever. Specifically, Provision produced no documents in response to RFP Nos. 8, 9, 11, 12-15, 21-24, 26, and 28-32. 5 Provision's failure is all the more remarkable given its agreement, in its August 9, 2017 RFP Responses, to produce documents in response to nine of those RFPs (specifically, RFP Nos. 8, 13, 21-24, 26, 28, and 29). During the September 7 Meet and Confer, Provision agreed to amend its RFP Responses and produce documents responsive to three more RFPs (Nos. 11, 12, and 31), and agreed to reconsider its objections to an additional four RFPs (Nos. 9, 14, 30, and 32). See Sections II.B. and II.C. below. Indeed, during the parties' September 7 Meet and Confer, there was only one RFP for which Provision indicated an intent to stand on its objections (RFP No. 15), and, as explained in Section II.E., that objection is not well taken. Provision's failure to produce any documents in response to 17 of DB Dava's RFPs - 12 of which Provision affirmatively agreed to answer, and only 1 of which appears to be actually in dispute - is completely unacceptable. We urge you to correct this failure as soon as possible, failing which, DB Dava will have no choice but to seek the intervention of the Court. II. PROVISION'S RFP RESPONSES MUST BE AMENDED Separate from the Document Productions, Provision's written RFP Responses remain deficient for the reasons set forth in DB Dava's August 31 Letter and discussed during the September 7 Meet and Confer. We ask that Provision promptly follow through on its representations by amending the RFP Responses, consistent with the following summary of the September 7 Meet and Confer, no later than Friday, September 29, 2017. A. Provision Confirmed that All Responsive, Non-Privileged Documents Will Be Produced in Response to RFP Nos. 1-3, 6, 7, 10, 13, 16-19, 21-29 Our August 31 Letter noted that Provision's responses to RFP Nos. 1-3, 6, 7, 10, 13, 16-19, 21-29 were incomplete and did not make clear whether Provision would produce all responsive documents or merely a subset of responsive documents. During the September 7 Meet and Confer, you clarified that Provision does not intend to withhold any responsive, nonprivileged document in response to these RFPs - in other words, Provision committed to provide Provision's RFP Responses were originally ambiguous as to whether any documents would be withheld, but Provision clarified its position on this point during the September 7 Meet and Confer. 5 It also appears that Provision has failed to produce documents in response to RFP Nos. 2, 5, 6, 25, and 27. However, because its review of the Document Productions is ongoing, DB Dava does not raise these issues at this time, but reserves its rights to do so later. 5
Page 6 LATHAM&WATKINSLLP all non-privileged documents that are responsive to these RFPs. However, with respect to RFP Nos. 6 and 7, we understand that Provision committed to amend its responses and produce all non-privileged, responsive documents that are sufficient to identify the retail partner(s), stores, or other locations referenced in those RFPs. B. Provision Agreed to Amend its Responses to RFP Nos. 5, 11, 12, 20, and 31, And to Produce Documents Accordingly 1. Provision Agreed to Amend Its Response to RFP No. 5 Based on the Clarification in DB Dava's August 31 Letter As our August 31 Letter noted, RFP No. 5 inadvertently referenced a press release dated November 1, 2016 rather than September 1, 2016. During the September 7 Meet and Confer, you indicated that Provision will amend its response to this RFP on the understanding that DB Dava intended to use the September 1, 2016 date, and Provision committed to produce all nonprivileged, responsive documents accordingly. 2. Provision Agreed to Amend Its Responses to RFP Nos. 11 and 12 Provision agreed to amend its responses to these RFPs and committed to produce all nonprivileged, responsive documents. 3. Provision Agreed to Amend Its Response to RFP No. 20 as Narrowed During the September 7 Meet and Confer Provision agreed to amend its response to this RFP and committed to produce all coupon reports that were created or maintained in the regular course of business. We agreed that, initially, Provision does not need to produce reports of real-time or continuous data generated by the 3D kiosks on an hourly or daily basis that was not otherwise reflected or summarized in the coupon reports, but DB Dava reserved its right to seek such reports if the production does not contain sufficient information. 4. Provision Agreed to Amend Its Response to RFP No. 31 as Narrowed During the September 7 Meet and Confer DB Dava has agreed to limit the DOCUMENTS and COMMUNICATIONS sought by this RFP to the subject matter of 3D products and/or 3D advertising. Provision agreed to amend its response to this RFP consistent with that limitation, and committed to produce all nonprivileged, responsive documents accordingly. C. Provision Agreed to Reconsider its Responses to RFP Nos. 8, 9, 14, 30, and 32 1. RFP Nos. 8, 9, and 32 Are Highly Relevant and Narrowly Tailored As we explained during the September 7 Meet and Confer and in our August 31 Letter, RFP Nos. 8, 9, and 32 are highly probative of DB Dava's counterclaims for fraud, as well as Provision's compliance (or non-compliance) with its obligations under the right-of-first-refusal 6
Page7 LATHAM&WATKI NSLLP and exclusivity terms of the ProDava LLC Agreement. Accordingly, there is no basis for Provision's refusal to provide a complete response to RFP No. 8, nor its refusal to provide any documents in response to RFP Nos. 9 and 32. We understand that Provision is reconsidering its objections to RFP Nos. 8, 9, and 32 in light of the points raised in our August 31 Letter. We urge Provision to amend its responses and make a complete production of non-privileged, responsive documents without the intervention of the Court. 2. RFP No. 14's "Related Party Revenue" Refers to ProDava Provision agreed to amend its response and produce all non-privileged, responsive documents to this RFP (which concerns "PROVISION's calculation of RELATED PARTY REVENUE"), once Provision confirms that the "related party" referenced in Provision's SEC filings is ProDava. DB Dava's RFPs define "RELATED PARTY REVENUE" as "revenue PROVISION received from PRODA VA in connection with PROVISION'S sale and service of hardware and software for PROVISION'S 3D Savings Center kiosks[.]" Thus, "RELATED PARTY REVENUE" is revenue received from ProDava - by definition. The Form 10-Q of Provision's parent company for the quarterly period ended December 31, 2016 confirms the point on page 26, where it states: "The related party revenue for the three months ended December 31, 2015 is for sales to ProDava 3D, LLC to purchase Provision's 3D Savings Center kiosks for placement into retail stores." Accordingly, we ask Provision to confirm that it will amend its response to this RFP and produce all non-privileged, responsive documents. 3. RFP No. 30 Is Appropriately Tailored and Not Overbroad During the September 7 Meet and Confer, you stated your view that RFP No. 30 is overbroad because it seeks documents relating to any business venture without limitation. But as we explained during that call, RFP No. 30 is limited to business ventures between Provision on the one hand and Sean Davatgar and Dava Fusion, LLC on the other. You provided no factual support that such a request is overbroad. We understand that you are conferring with your client to determine whether Provision discussed any other possible business venture with Sean Davatgar and/or Dava Fusion, LLC, and if not, Provision will amend its response to this RFP and produce all non-privileged, responsive documents. However, even if Provision did discuss other possible business ventures with Mr. Davatgar or with Dava Fusion, LLC, DB Dava reserves its rights to seek discovery into those issues pursuant to RFP No. 30 (or otherwise). 7
Page 8 LATHAM&WATKINSLLP D. Additional Issues Regarding Provision's Responses to RFP Nos. 4 and 5 1. DB Dava Is Entitled to a Complete Response to RFP No. 4 As we explained in our August 31 Letter, RFP No. 4 seeks, inter alia, documents relating to Provision's maintenance of or technical support for the 3D kiosks. Not only are these documents highly probative of Provision's claim to have fully performed its obligations under the relevant agreements, but Provision is required to maintain these documents (and produce them on request) pursuant to the PSA. Although we did not discuss RFP No. 4 during the September 7 Meet and Confer, we reiterate the points raised in our August 31 Letter, and urge Provision to amend its response to this RFP and make a complete production of non-privileged, responsive documents without the intervention of the Court. E. RFP No. 15 Seeks Relevant Documents Not Covered by the Carve-out During the September 7 Meet and Confer, you stated your view that RFP No. 15 does not seek relevant documents because the ProDava LLC Agreement contains a "carve-out" authorizing the placement of 3D kiosks in collaboration with Lifestyle Ventures, LLC ("Lifestyle"). But the Lifestyle carve-out is not unlimited in scope; after the placement of 200 3D kiosks, any further collaboration with Lifestyle is subject to and conditional on DB Dava's right of first refusal. See LLC Agreement 2. 7. Accordingly, DB Dava is entitled to documents responsive to RFP No. 15, which are highly probative of Provision's compliance (or non-compliance) with its obligations under the right-of-first-refusal terms of the ProDava LLC Agreement. We urge Provision to amend its response to this RFP and make a complete production of non-privileged, responsive documents without the intervention of the Court. * * * 8
Page9 LATHAM&WATKI NSLLP If you wish to discuss these matters further, I am available for a call this Friday, September 29, 2017 or next week. If we cannot reach a resolution, DB Dava intends to seek a discovery conference with the Court. DB Dava reserves all of its rights, including but not limited to its rights under section 3124 of the CPLR. espectfully, /7..D. vt),_l,,,.11 Joshua G. Hamilton of LATHAM & WATKINS LLP (Admitted Pro Hae Vice) cc: James Brandt, Esq. 9