Supplemental Responses and Objections to Relator's First Set of Interrogatories (Berkley v. Ocean State, LLC)

Summary

Document 47-1, filed 05/17/24 in Case 1:20-cv-00538-JJM-PAS in the United States District Court for the District of Rhode Island, brought by relator James R. Berkley against Ocean State, LLC and other defendants. It contains Ocean State's supplemental responses and objections to the relator's first set of interrogatories, verified by John Roselli on 2/20/2024, followed by similar responses for Blueprint Test Preparation, LLC and the closing pages for Fyzical Acquisition Holdings, LLC, verified by Eric Thompson. Ocean State states that John Roselli and Sarah Charette analyzed the impact of the COVID 2019 Pandemic and concluded it met the PPP loan requirements. Both responses say the companies were exempt from affiliation rules because of financial assistance from Deerpath Funding Advantage IV, LP.

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Cite this document

“Supplemental Responses and Objections to Relator's First Set of Interrogatories (Berkley v. Ocean State, LLC).” Original at archive.org. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/motion-to-compel-discovery-of-united-states-ex-rel-james-r-berkley-v-o-2e77eb459d/, SHA-256 d6ebef2d8b9e199d45cbd162e52d4c958354a26502792385dd8f73bba0b7772a.

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Case 1:20-cv-00538-JJM-PAS Document 47-1

Filed 05/17/24 Page 2 of 26 PagelD

#: 2033

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND

UNITED STATES OF AMERICA ex rel.
JAMES R. BERKLEY,

Relator,
Vv.

OCEAN STATE, LLC, NEW HARBOR
CAPITAL FUND LP, NEW HARBOR
CAPITAL FUND II LP, NEW HARBOR
CAPITAL MANAGEMENT LP,
BLUEPRINT TEST PREPARATION, LLC,
FYZICAL ACQUISITION HOLDINGS,
LLC,

Defendants.

C.A. No. 1:20-cv-00538-JJM-PAS

DEFENDANT OCEAN STATE, LLC’S SUPPLEMENTAL RESPONSES AND

OBJECTIONS TO RELATOR’S FIRST SET OF INTERROGATORIES

Pursuant to Rules 26 and 33 of the Federal Rules of Civil Procedure, Defendant Ocean

State, LLC (“Defendant”) hereby submits the following supplemental responses and objections

(“Responses”) to Relator’s Interrogatories (the “Interrogatories” and each, an “Interrogatory’’),

served in the above-captioned action (the “Action”) on August 7, 2023.!

SUPPLEMENTAL RESPONSES AND OBJECTIONS TO INTERROGATORIES

INTERROGATORY NO. 1:

Identify each Person known or believed by You to have knowledge, Documents, or
information concerning any fact alleged in the Complaint, or any fact underlying the subject matter

of the Litigation, providing for each:

a. his or her name, occupation/title, telephone number, and address;

For purposes of preservation and to the extent permitted in light of this Court’s January 29

Order, Defendant incorporates, restates, and does not waive all objections made and terms
defined in its September 13, 2023 Responses and Objections.
Case 1:20-cv-00538-JJM-PAS Document 47-1 Filed 05/17/24 Page 3 of 26 PagelD
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33(d), it will produce documents in a forthcoming document production from which information
responsive to this Interrogatory may be obtained.

INTERROGATORY NO. 12:

Identify and explain in detail how was it determined that You met the economic necessity
certification contained in the PPP Loan Application, including:

a. who prepared the analysis;

b. whether an attorney or other consultant was utilized; and

C. whether there were Communications with the investors regarding the
determination.

RESPONSE TO INTERROGATORY NO. 12:

Defendant objects to this Interrogatory as compound because it combines multiple requests
for information into a single Interrogatory and therefore should be considered multiple
interrogatories under Federal Rule of Civil Procedure 33(a). Defendant further objects to this
Interrogatory because it is overbroad, unduly burdensome, and not proportional to the needs of the
case. Defendant further objects to this Interrogatory because it is vague and ambiguous, including

99 66

to the extent it relies on the undefined terms “economic necessity certification,” “analysis,” and
“determination.” Defendant further objects to this Interrogatory to the extent that it calls for
privileged information and legal analysis.

Subject to and without waiving its objections, Defendant states that certain individuals
including but not limited to John Roselli analyzed the severe impact of the COVID 2019 Pandemic

on Ocean State and concluded that it met the applicable requirements of the PPP loan program.

Defendant further states that it consulted with attorneys in relation to its PPP loan application.?

2 By making this statement in direct response to Relator’s Interrogatory, Defendant does not

waive or relinquish any attorney-client privilege, work-product protections, or other

19
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Defendant further states that it communicated with investors regarding its PPP loan application.
Defendant further responds that, pursuant to Fed. R. Civ. P. 33(d), it will produce documents in a
forthcoming document production from which information responsive to this Interrogatory may
be obtained. Fact discovery is ongoing, and Defendant reserves the right to supplement or modify
its response to Interrogatory No. 12 in accordance with the Federal Rules of Civil Procedure.

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 12: Defendant states that

certain individuals including but not limited to John Roselli and Sarah Charette analyzed the severe
impact of the COVID 2019 Pandemic on Ocean State and concluded that it met the applicable
requirements of the PPP loan program. This includes but is not limited to analyzing Ocean State’s
revenue, expenses, cash flow, and operations. For example, Defendant’s primary care clinics were
forced to transition to telemedicine, resulting in altogether lower patient volumes paired with lower
payer reimbursement rates for patient visits. Defendant further states that it consulted with

3 Defendant further states that it communicated

attorneys in relation to its PPP loan application.
with investors regarding its PPP loan application. Defendant further responds that, pursuant to
Fed. R. Civ. P. 33(d), it will produce documents in a forthcoming document production from which
information responsive to this Interrogatory may be obtained. Fact discovery is ongoing, and

Defendant reserves the right to supplement or modify its response to Interrogatory No. 12 in

accordance with the Federal Rules of Civil Procedure.

privileges and protections, nor is Defendant invoking an “advice of counsel” defense by
making this statement.

By making this statement in direct response to Relator’s Interrogatory, Defendant does not
waive or relinquish any attorney-client privilege, work-product protections, or other
privileges and protections, nor is Defendant invoking an “advice of counsel” defense by
making this statement.

20
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more difficult to meet payroll.” With respect to the Affiliation Requirement, as Ms. Charette
explained, Ocean State obtained a letter from SBIC-approved lender Deerpath Funding Advantage
IV, LP (SBA License Number 02/02-0679), which proved that Ocean State qualified for an
“exception under [the] affiliation [rules] because we had SBIC funding.” See also Second
Amended Compl., Dkt. 28, 66 (recognizing that “the CARES Act waives the affiliation rules” for
a “business that receives financial assistance from a small business investment company licensed
by SBA (‘SBIC’).)”). Blueprint similarly was exempt from the affiliation rules because it received
financial assistance form an SBIC-approved lender, and Fyzical qualified for an exemption
because of its status as a “franchise with a franchise identifier code assigned by SBA in the SBA
Franchise Directory.” /d. (recognizing this exception too). Defendant states that further support
for why any loan applications or other documents submitted by Defendants to the federal
government comply with all applicable laws, regulation, and authoritative guidance available at
the time they were made will be contained in the accompanying productions of documents, further
deposition testimony, and other evidence that will be produced in this case.

INTERROGATORY NO. 18:

State the basis for Your Fifth Affirmative Defense that “Relator’s claims are barred, in
whole or in part, because Defendants had a reasonable belief in the lawfulness of their conduct.”

RESPONSE TO INTERROGATORY NO. 18:

Defendant objects that this is a premature contention interrogatory. Defendant proposes to
respond substantively (subject to these objections) to this contention interrogatory at a reasonable
time after the close of discovery.

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 18: Defendant responds to this

Interrogatory based on facts and information known to date, and reserves the right to supplement

this Interrogatory at or near the close of discovery based on information learned and research

25
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conducted in support of its argument. Defendant also incorporates the arguments made in its
Motion to Dismiss Realtor’s Second Amended Complaint, Dkt. 29, and briefing and argument
made in support thereof. Defendant states that for the reasons discussed in its response to
Interrogatory No. 12, Defendants believed that all of their conduct with respect to the PPP loan
application and all of the certifications contained in the PPP loan application submitted by Ocean
State, Blueprint, and Fyzical were lawful and accurate. Furthermore, Defendants diligently
investigated the applicable laws and regulations in order to ensure the lawfulness of their conduct.
Defendant states that further support for why Defendants had a reasonable belief in the lawfulness
of their conduct will be contained in the accompanying productions of documents, further
deposition testimony, and other evidence that will be produced in this case.

INTERROGATORY NO. 19:

State the basis for Your Sixth Affirmative Defense that “Relator’s claims are barred, in
whole or in part, because the federal government was aware of Defendants’ statements.”

RESPONSE TO INTERROGATORY NO. 19:

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 19: Defendant responds to this

Interrogatory based on facts and information known to date, and reserves the right to supplement
this Interrogatory at or near the close of discovery based on information learned and research
conducted in support of its argument. Defendant also incorporates the arguments made in its
Motion to Dismiss Realtor’s Second Amended Complaint, Dkt. 29, and briefing and argument
made in support thereof. Defendant states that documents submitted to the government, including

PPP loan applications and PPP Loan Necessity Questionnaires, identified entities related to

26
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government will be contained in the accompanying productions of documents, further deposition

testimony, and other evidence that will be produced in this case.

Dated: February 20, 2024

Respectfully submitted,

/s/ Ryan Moorman

Patricia K. Rocha (#2793)
procha@apslaw.com

Patrick N. Sampson (#9885)
psampson@apslaw.com

ADLER POLLOCK & SHEEHAN P.C.
One Citizens Plaza, 8th Floor
Providence, RI 02903-1345

Tel: (401) 274-7200

Fax: (401) 351-4607

Ryan Moorman (pro hac vice)
Patrick Weeks (pro hac vice)
KIRKLAND & ELLIS LLP
300 North LaSalle

Chicago, IL 60654

Tel: (312) 862-2000

Fax: (312) 862-2200
ryan.moorman@kirkland.com
patrick.weeks@kirkland.com

Attorneys for Defendant Ocean State, LLC.
Case 1:20-cv-00538-JJM-PAS Document 47-1 Filed 05/17/24 Page 8 of 26 PagelD
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CERTIFICATE OF SERVICE

I hereby certify that on February 20, 2024, a true and correct copy of Defendant Ocean
State, LLC’s Supplemental Responses and Objections to Plaintiff’s First Set of Interrogatories was
served upon counsel of record at the addresses indicated by CM/ECF electronic notification.

/s/ Ryan Moorman

Ryan Moorman

29
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#: 2040

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND

UNITED STATES OF AMERICA ex rel.
JAMES R. BERKLEY,

Relator,
Vv. No. 1:20-cv-00538-JJM-PAS

OCEAN STATE, LLC, NEW HARBOR
CAPITAL FUND LP, NEW HARBOR
CAPITAL FUND II LP, NEW HARBOR
CAPITAL MANAGEMENT LP,
BLUEPRINT TEST PREPARATION, LLC,
FYZICAL ACQUISITION HOLDINGS,
LLC,

Defendants.

VERIFICATION

L John Roselli , depose and say that I am a named Defendant, or an authorized

representative of a named Defendant, in the above-entitled action, I have read the foregoing
Supplemental Responses and Objections to Interrogatories, know and understand the contents
thereof, and that the information contained therein is true to the best of my knowledge and belief.

I declare under penalty of perjury that the foregoing is true and correct.

2/20/2024 /s/ John Roselli

Date Signature
Case 1:20-cv-00538-JJM-PAS Document 47-1 Filed 05/17/24 Page 10 of 26 PagelD
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND

UNITED STATES OF AMERICA ex rel.
JAMES R. BERKLEY,

Relator,

Vv.

OCEAN STATE, LLC, NEW HARBOR
CAPITAL FUND LP, NEW HARBOR
CAPITAL FUND II LP, NEW HARBOR
CAPITAL MANAGEMENT LP,
BLUEPRINT TEST PREPARATION, LLC,
FYZICAL ACQUISITION HOLDINGS,
LLC,

Defendants.

C.A. No. 1:20-cv-00538-JJM-PAS

DEFENDANT BLUEPRINT TEST PREPARATION, LLC’S SUPPLEMENTAL

RESPONSES TO RELATOR’S FIRST SET OF INTERROGATORIES

Pursuant to Rules 26 and 33 of the Federal Rules of Civil Procedure, Defendant Blueprint

Test Preparation, LLC (“Defendant”) hereby submits the following supplemental responses and

objections (“Responses”) to Relator’s Interrogatories (the “Interrogatories” and each, an

“Interrogatory”), served in the above-captioned action (the “Action”) on August 7, 2023.!

SUPPLEMENTAL RESPONSES AND OBJECTIONS TO INTERROGATORIES

INTERROGATORY NO. 1:

Identify each Person known or believed by You to have knowledge, Documents, or
information concerning any fact alleged in the Complaint, or any fact underlying the subject matter

of the Litigation, providing for each:

a. his or her name, occupation/title, telephone number, and address;

For purposes of preservation and to the extent permitted in light of this Court’s January 29

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 11: Defendant states that it

determined it did not need to consider “affiliates” with respect to its PPP loan application, and
specifically with respect to the size-standard requirement, because Blueprint received financial
assistance from Deerpath Funding Advantage IV, LP, and the PPP Loan Application did not
require any further information on this topic for entities meeting this exception. See 15 USC
636(a)(36)(D)(iv). Defendant entered into a Loan Agreement with Deerpath Funding Advantage
IV, LP on April 5, 2018, as amended by the First Amendment to Loan Agreement, dated April 21,
2020. Therefore, individuals including Matthew Riley determined Defendant received financial
assistance from an SBA-approved lender. Defendant further notes that it reviewed the
requirements of the PPP loan program and ensured that it complied with any such applicable
requirements. Individuals including Riley further determined that Blueprint on its own satisfied
the relevant size-standard requirements by considering Blueprint’s revenue, employee count, and
other relevant information. Defendant further responds that, pursuant to Fed. R. Civ. P. 33(d), it
will produce documents in a forthcoming document production from which information responsive

to this Interrogatory may be obtained.

INTERROGATORY NO. 12:

Identify and explain in detail how was it determined that You met the economic necessity
certification contained in the PPP Loan Application, including:

a. who prepared the analysis;

b. whether an attorney or other consultant was utilized; and

c. whether there were Communications with the investors regarding the
determination.

18
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#: 2043

RESPONSE TO INTERROGATORY NO. 12:

99 66

Subject to and without waiving its objections, Defendant states that certain individuals
including but not limited to Matthew Riley analyzed the severe impact of the COVID 2019
Pandemic on Blueprint and concluded that it met the applicable requirements of the PPP loan
program. Defendant further states that it consulted with attorneys in relation to its PPP loan
application.* Defendant further states that it communicated with investors regarding its PPP loan
application. Defendant further responds that, pursuant to Fed. R. Civ. P. 33(d), it will produce
documents in a forthcoming document production from which information responsive to this
Interrogatory may be obtained. Fact discovery is ongoing, and Defendant reserves the right to

supplement or modify its response to Interrogatory No. 12 in accordance with the Federal Rules

of Civil Procedure.

By making this statement in direct response to Relator’s Interrogatory, Defendant does not
waive or relinquish any attorney-client privilege, work-product protections, or other privileges
and protections, nor is Defendant invoking an “advice of counsel” defense by making this
statement.

19
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SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 12: Defendant states that

certain individuals including but not limited to Matthew Riley and Josh Zuckerwise analyzed the
severe impact of the COVID 2019 Pandemic on Blueprint and concluded that it met applicable
requirements of the PPP loan program. This includes but is not limited to analyzing Blueprint’s
revenue, expenses, cash flow, and operations. Defendant further states that it consulted with
attorneys in relation to its PPP loan application.* Defendant further states that it communicated
with investors regarding its PPP loan application. Defendant further responds that, pursuant to
Fed. R. Civ. P. 33(d), it will produce documents in a forthcoming document production from which
information responsive to this Interrogatory may be obtained. Fact discovery is ongoing, and
Defendant reserves the right to supplement or modify its response to Interrogatory No. 12 in

accordance with the Federal Rules of Civil Procedure.

INTERROGATORY NO. 13:

Identify all Persons that had any involvement in the preparation and filing of Your PPP
Loan Forgiveness Application and explain in detail such Person(s) involvement.

RESPONSE TO INTERROGATORY NO. 13:

Defendant objects to this Interrogatory because it is vague and ambiguous, including to the
extent it relies on the undefined terms “involvement” and “preparation.” Defendant further objects
to this Interrogatory because it is overbroad, unduly burdensome, and not proportional to the needs
of the case. Defendant further objects to this Interrogatory to the extent that it is overbroad and

calls for information on any individual “involved” no matter the degree of involvement.

By making this statement in direct response to Relator’s Interrogatory, Defendant does not
waive or relinquish any attorney-client privilege, work-product protections, or other privileges
and protections, nor is Defendant invoking an “advice of counsel” defense by making this
statement.

20
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financial assistance form an SBIC-approved lender, and Fyzical qualified for an exemption
because of its status as a “franchise with a franchise identifier code assigned by SBA in the SBA
Franchise Directory.” Jd. (recognizing this exception too). Defendant states that further support
for why any loan applications or other documents submitted by Defendants to the federal
government comply with all applicable laws, regulation, and authoritative guidance available at
the time they were made will be contained in the accompanying productions of documents, further

deposition testimony, and other evidence that will be produced in this case.

INTERROGATORY NO. 18:

State the basis for Your Fifth Affirmative Defense that ‘“Relator’s claims are barred, in
whole or in part, because Defendants had a reasonable belief in the lawfulness of their conduct.”
S

RESPONSE TO INTERROGATORY NO. 18:

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 18: Defendant responds to this

State, Blueprint, and Fyzical were lawful and accurate. Furthermore, Defendants diligently

25
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Dated: February 20, 2024

#: 2046

Respectfully submitted,

/s/ Ryan Moorman

Patricia K. Rocha (#2793)
procha@apslaw.com

Patrick N. Sampson (#9885)
psampson@apslaw.com

ADLER POLLOCK & SHEEHAN P.C.
One Citizens Plaza, 8th Floor
Providence, RI 02903-1345

Tel: (401) 274-7200

Fax: (401) 351-4607

Ryan Moorman (pro hac vice)
Patrick Weeks (pro hac vice)
KIRKLAND & ELLIS LLP
300 North LaSalle

Chicago, IL 60654

Tel: (312) 862-2000

Fax: (312) 862-2200
ryan.moorman@kirkland.com
patrick.weeks@kirkland.com

Attorneys for Defendant Blueprint Test
Preparation, LLC.

28
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CERTIFICATE OF SERVICE

I hereby certify that on February 20, 2024, a true and correct copy of Defendant Blueprint
Test Preparation, LLC’s Supplemental Responses and Objections to Plaintiff's First Set of
Interrogatories was served upon counsel of record at the addresses indicated by CM/ECF electronic
notification.

/s/ Ryan Moorman

Ryan Moorman

29
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#: 2048

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND

UNITED STATES OF AMERICA ex rel.
JAMES R. BERKLEY,

Relator,
Vv. No. 1:20-cv-00538-JJM-PAS

OCEAN STATE, LLC, NEW HARBOR
CAPITAL FUND LP, NEW HARBOR
CAPITAL FUND II LP, NEW HARBOR
CAPITAL MANAGEMENT LP,
BLUEPRINT TEST PREPARATION, LLC,
FYZICAL ACQUISITION HOLDINGS,
LLC,

Defendants.

VERIFICATION

I, Matthew Riley , depose and say that I am a named Defendant, or an authorized

I declare under penalty of perjury that the foregoing is true and correct.

2/19/24 Mat

Date Signature
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND

UNITED STATES OF AMERICA ex rel.
JAMES R. BERKLEY,

Relator,

Vv.

OCEAN STATE, LLC, NEW HARBOR
CAPITAL FUND LP, NEW HARBOR
CAPITAL FUND II LP, NEW HARBOR
CAPITAL MANAGEMENT LP,
BLUEPRINT TEST PREPARATION, LLC,
FYZICAL ACQUISITION HOLDINGS,
LLC,

Defendants.

C.A. No. 1:20-cv-00538-JJM-PAS

DEFENDANT FYZICAL ACQUISITION HOLDINGS, LLC’S SUPPLEMENTAL

RESPONSES TO RELATOR’S FIRST SET OF INTERROGATORIES

Pursuant to Rules 26 and 33 of the Federal Rules of Civil Procedure, Defendant Fyzical

Acquisition Holdings, LLC (“Defendant”) hereby submits the following supplemental responses

and objections (“Responses”) to Relator’s Interrogatories (the “Interrogatories” and each, an

“Interrogatory”), served in the above-captioned action (the “Action”) on August 7, 2023.!

SUPPLEMENTAL RESPONSES AND OBJECTIONS TO INTERROGATORIES

INTERROGATORY NO. 1:

Identify each Person known or believed by You to have knowledge, Documents, or
information concerning any fact alleged in the Complaint, or any fact underlying the subject matter

of the Litigation, providing for each:

a. his or her name, occupation/title, telephone number, and address;

For purposes of preservation and to the extent permitted in light of this Court’s January 29

Defendant further notes that it reviewed the requirements of the PPP loan program and ensured
that it complied with any such applicable requirements. Defendant further responds that, pursuant
to Fed. R. Civ. P. 33(d), it will produce documents in a forthcoming document production from
which information responsive to this Interrogatory may be obtained. Fact discovery is ongoing,
and Defendant reserves the right to supplement or modify its response to Interrogatory No. 11 in
accordance with the Federal Rules of Civil Procedure.

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 11: Defendant states that it

determined it did not need to consider “affiliates” with respect to its PPP loan application, and
specifically with respect to the size-standard requirement, because Fyzical had a franchise
identifier code, and the PPP Loan Application did not require further information on this topic for
entities meeting this exception. See 15 U.S.C. 636(a)(36)(D)(iv). Therefore, individuals including
Eric Thompson determined Defendant fell within an exception to the Affiliation Requirement.
Defendant further notes that it reviewed the requirements of the PPP loan program and ensured
that it complied with any such applicable requirements. Individuals including Thompson further
determined that Fyzical on its own satisfied the relevant size-standard requirements by considering
Fyzical’s revenue, employee count, and other relevant information. Defendant further responds
that, pursuant to Fed. R. Civ. P. 33(d), it will produce documents in a forthcoming document
production from which information responsive to this Interrogatory may be obtained.

INTERROGATORY NO. 12:

Identify and explain in detail how was it determined that You met the economic necessity
certification contained in the PPP Loan Application, including:

a. who prepared the analysis;

b. whether an attorney or other consultant was utilized; and

C. whether there were Communications with the investors regarding the
determination.

17
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RESPONSE TO INTERROGATORY NO. 12:

99 66

Subject to and without waiving its objections, Defendant states that certain individuals
including but not limited to Eric Thompson analyzed the severe impact of the COVID 2019
Pandemic on Fyzical Holdings and concluded that it met the applicable requirements of the PPP
loan program. Defendant further states that it consulted with attorneys in relation to its PPP loan
application.* Defendant further states that it communicated with investors regarding its PPP loan
application. Defendant further responds that, pursuant to Fed. R. Civ. P. 33(d), it will produce
documents in a forthcoming document production from which information responsive to this
Interrogatory may be obtained. Fact discovery is ongoing, and Defendant reserves the right to

supplement or modify its response to Interrogatory No. 12 in accordance with the Federal Rules

of Civil Procedure.

By making this statement in direct response to Relator’s Interrogatory, Defendant does not
waive or relinquish any attorney-client privilege, work-product protections, or other privileges
and protections, nor is Defendant invoking an “advice of counsel” defense by making this
statement.

18
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SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 12: Defendant states that

certain individuals including but not limited to Eric Thompson analyzed the severe impact of the
COVID 2019 Pandemic on Fyzical and concluded that it met the applicable requirements of the
PPP loan program. This includes but is not limited to analyzing Fyzical’s revenue, expenses, cash
flow, and operations. For example, based on Defendant’s reasonable investigation to date, 20% of
Fyzical’s franchisees closed and patient visits were down 40% to 70% in the clinics that remained
open. Defendant had concerns over its ability to meet certain debt covenants that could restrict its
access to capital, including its outstanding revolver capacity. Moreover, Defendant did not
anticipate a return to normalcy in 2020 due to patients’ reluctance to receive hands-on care from a
physical therapist in a clinical setting. Defendant further states that it consulted with attorneys in

4 Defendant also communicated with certain investors

relation to its PPP loan application.
regarding its PPP loan application. Defendant further responds that, pursuant to Fed. R. Civ. P.
33(d), it will produce documents in a forthcoming document production from which information
responsive to this Interrogatory may be obtained. Fact discovery is ongoing, and Defendant
reserves the right to supplement or modify its response to Interrogatory No. 12 in accordance with

the Federal Rules of Civil Procedure.

INTERROGATORY NO. 13:

Identify all Persons that had any involvement in the preparation and filing of Your PPP
Loan Forgiveness Application and explain in detail such Person(s) involvement.

By making this statement in direct response to Relator’s Interrogatory, Defendant does not
waive or relinquish any attorney-client privilege, work-product protections, or other privileges
and protections, nor is Defendant invoking an “advice of counsel” defense by making this
statement.

19
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#: 2053

qualified for an “exception under [the] affiliation [rules] because we had SBIC funding.” See also
Second Amended Compl., Dkt. 28, 66 (recognizing that “the CARES Act waives the affiliation
rules” for a “business that receives financial assistance from a small business investment company
licensed by SBA (‘SBIC’).)”). Blueprint similarly was exempt from the affiliation rules because
it received financial assistance form an SBIC-approved lender, and Fyzical qualified for an
exemption because of its status as a “franchise with a franchise identifier code assigned by SBA
in the SBA Franchise Directory.” Jd. (recognizing this exception too). Defendant states that
further support for why any loan applications or other documents submitted by Defendants to the
federal government comply with all applicable laws, regulation, and authoritative guidance
available at the time they were made will be contained in the accompanying productions of
documents, further deposition testimony, and other evidence that will be produced in this case.

INTERROGATORY NO. 18:

State the basis for Your Fifth Affirmative Defense that ‘“Relator’s claims are barred, in
whole or in part, because Defendants had a reasonable belief in the lawfulness of their conduct.”

RESPONSE TO INTERROGATORY NO. 18:

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 18:

Dkt. 29, and briefing and argument made in support thereof. Defendant states that for the reasons

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discussed in its response to Interrogatory No. 12, Defendants believed that all of their conduct with
respect to the PPP loan application and all of the certifications contained in the PPP loan
application submitted by Ocean State, Blueprint, and Fyzical were lawful and accurate.
Furthermore, Defendants diligently investigated the applicable laws and regulations in order to
ensure the lawfulness of their conduct. Defendant states that further support for why Defendants
had a reasonable belief in the lawfulness of their conduct will be contained in the accompanying
productions of documents, further deposition testimony, and other evidence that will be produced
in this case.

INTERROGATORY NO. 19:

State the basis for Your Sixth Affirmative Defense that “Relator’s claims are barred, in
whole or in part, because the federal government was aware of Defendants’ statements.”

RESPONSE TO INTERROGATORY NO. 19:

SUPPLEMENTAL RESPONSE TO INTERROGATORY NO. 19:

Defendant responds to this Interrogatory based on facts and information known to date, and
reserves the right to supplement this Interrogatory at or near the close of discovery based on
information learned and research conducted in support of its argument. Defendant also
incorporates the arguments made in its Motion to Dismiss Realtor’s Second Amended Complaint,
Dkt. 29, and briefing and argument made in support thereof. Defendant states that documents
submitted to the government, including PPP loan applications and PPP Loan Necessity
Questionnaires, identified entities related to Defendant as having ownership interests in Fyzical,

Blueprint, and Ocean State. Thus, there is no dispute that the federal government was aware of

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government will be contained in the accompanying productions of documents, further deposition

testimony, and other evidence that will be produced in this case.

Dated: February 20, 2024

Respectfully submitted,

/s/ Ryan Moorman

Patricia K. Rocha (#2793)
procha@apslaw.com

Patrick N. Sampson (#9885)
psampson@apslaw.com

ADLER POLLOCK & SHEEHAN P.C.
One Citizens Plaza, 8th Floor
Providence, RI 02903-1345

Tel: (401) 274-7200

Fax: (401) 351-4607

Ryan Moorman (pro hac vice)
Patrick Weeks (pro hac vice)
KIRKLAND & ELLIS LLP
300 North LaSalle

Chicago, IL 60654

Tel: (312) 862-2000

Fax: (312) 862-2200
ryan.moorman@kirkland.com
patrick.weeks@kirkland.com

Attorneys for Defendant Fyzical Acquisition
Holdings, LLC.

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CERTIFICATE OF SERVICE

I hereby certify that on February 20, 2024, a true and correct copy of Defendant Fyzical
Acquisition Holdings, LLC’s Responses and Objections to Plaintiffs First Set of Interrogatories
was served upon counsel of record at the addresses indicated by CM/ECF electronic notification.

/s/ Ryan Moorman

Ryan Moorman

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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF RHODE ISLAND

UNITED STATES OF AMERICA ex rel.
JAMES R. BERKLEY,

Relator,
Vv. No. 1:20-cv-00538-JJM-PAS

OCEAN STATE, LLC, NEW HARBOR
CAPITAL FUND LP, NEW HARBOR
CAPITAL FUND II LP, NEW HARBOR
CAPITAL MANAGEMENT LP,
BLUEPRINT TEST PREPARATION, LLC,
FYZICAL ACQUISITION HOLDINGS,
LLC,

Defendants.

VERIFICATION

L Eric Thompson , depose and say that I am a named Defendant, or an authorized

representative of a named Defendant, in the above-entitled action, I have read the foregoing
Supplemental Responses and Objections to Interrogatories, know and understand the
contents thereof, and that the information contained therein is true to the best of my knowledge

and belief. I declare under penalty of perjury that the foregoing is true and correct.

2/20/2024 /s/ Eric Thompson

Date Signature

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