PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

D. LAMAR DELOACH; WILLIAM G. 

HYMAN; HYMAN FARMS,

INCORPORATED; GUY W. HALE; JAMES

R. SMITH; HOUSTON T. EVERETT; D.

KEITH PARRISH,

Plaintiffs-Appellees,

v.

LORILLARD TOBACCO COMPANY;

PHILIP MORRIS USA, INCORPORATED,

Defendants-Appellants,

and  No. 04-1923 R.J. REYNOLDS TOBACCO COMPANY,

Defendant-Appellee,

and

PHILIP MORRIS INTERNATIONAL; R.J.R.

NABISCO HOLDINGS CORPORATION;

B.A.T. INDUSTRIES, PLC; BRITISH

AMERICAN TOBACCO COMPANY

LIMITED; J. P. TAYLOR COMPANY,

INCORPORATED; SOUTHWESTERN

TOBACCO COMPANY, INCORPORATED;

DIMON, INCORPORATED; STANDARD

COMMERCIAL CORPORATION; 
PHILIP MORRIS INTERNATIONAL; LOEWS 

CORPORATION; R.J.R. NABISCO,

INCORPORATED; UNIVERSAL LEAF

CORPORATION,

Defendants.



DAVID DIPERNA,

Claimant,

JIMMY K. LEE; W. DENNY LEE; DALE

R. LUCAS; SAMMY TANT,

Movants. 

Appeal from the United States District Court

for the Middle District of North Carolina, at Durham.

William L. Osteen, District Judge.

(CA-00-1235-1)

Argued: October 26, 2004

Decided: December 6, 2004

Before NIEMEYER, MICHAEL, and MOTZ, Circuit Judges.

Affirmed in part and reversed in part by published opinion. Judge

Niemeyer wrote the opinion, in which Judge Michael and Judge Motz

joined. 

COUNSEL

ARGUED: David Boies, BOIES, SCHILLER & FLEXNER, L.L.P.,

Armonk, New York; James T. Williams, Jr., BROOKS, PIERCE,

MCLENDON, HUMPHREY & LEONARD, Greensboro, North Car2 DELOACH v. LORILLARD TOBACCO CO.
olina, for Appellants. Alan Mitchell Wiseman, HOWREY, SIMON,

ARNOLD & WHITE, L.L.P., Washington, D.C., for Appellees. ON

BRIEF: Larry B. Sitton, Gregory G. Holland, SMITH MOORE,

L.L.P., Greensboro, North Carolina; Carl J. Nichols, BOIES, SCHILLER & FLEXNER, L.L.P., Washington, D.C., for Appellant Philip

Morris USA, Inc. Mack Sperling, Jennifer K. Van Zant, BROOKS,

PIERCE, MCLENDON, HUMPHREY & LEONARD, Greensboro,

North Carolina, for Appellant Lorillard Tobacco Company. Alexander J. Pires, Jr., CONLON, FRANTZ, PHELAN & PIRES, L.L.P.,

Washington, D.C.; Stuart H. Harris, Thomas A. Isaacson, Joseph A.

Ostoyich, HOWREY, SIMON, ARNOLD & WHITE, L.L.P., Washington, D.C.; Richard M. Hutson, HUTSON, HUGHES & POWELL,

Durham, North Carolina, for Appellees. W. Andrew Copenhaver,

WOMBLE, CARLYLE, SANDRIDGE & RICE, P.L.L.C., WinstonSalem, North Carolina; Sean E. Andrussier, WOMBLE, CARLYLE,

SANDRIDGE & RICE, P.L.L.C., Raleigh, North Carolina, for Appellee R.J. Reynolds Tobacco Company. 

OPINION

NIEMEYER, Circuit Judge: 

In this appeal, we determine the impact on a settlement agreement,

partially resolving a class action, of a second settlement agreement

resolving the remainder of the same action. 

Tobacco farmers commenced this antitrust class action against several tobacco manufacturers and dealers, alleging that the defendants

conspired to violate the federal antitrust laws. The parties, except for

R.J. Reynolds Tobacco Company ("RJR"), settled the case with a settlement agreement dated May 15, 2003 (the "First Settlement Agreement"). The First Settlement Agreement included two provisions for

adjusting benefits to the plaintiff Class, and the triggering of these

adjustments depended on the existence and timing of a later settlement agreement with RJR. The first provision adjusted the monetary

payments that the settling defendants agreed to make to the Class

based on the terms of any settlement that the Class might reach with

RJR "on or before the day before the first day of trial." The second

DELOACH v. LORILLARD TOBACCO CO. 3
provision adjusted the amounts of tobacco that the settling manufacturers agreed to purchase from Class members based on the terms of

any settlement that the Class might enter into with RJR "before the

beginning of trial." 

The tobacco farmer Class did subsequently enter into a settlement

agreement with RJR dated April 22, 2004 (the "RJR Settlement" or

the "Second Settlement"). The district court found that the RJR Settlement was "reached" when it was signed on April 22, 2004, which was

also the date scheduled for the beginning of trial. On motions filed by

settling defendants Philip Morris USA, Inc. ("Philip Morris") and

Lorillard Tobacco Company ("Lorillard") to trigger the adjustments

available in the First Settlement Agreement based on the RJR Settlement, the district court entered an order dated June 4, 2004, concluding that the settling defendants were not entitled to either of the

adjustments because the RJR Settlement was not reached or entered

into before the triggering times specified in the First Settlement

Agreement. Philip Morris and Lorillard appealed. 

For the reasons given hereafter, we deny the Class’s motion to dismiss this appeal based on its assertions (1) that the language of the

First Settlement Agreement made the district court’s resolution of the

issues "non-appealable" and (2) that the district court’s order interpreting the First Settlement Agreement was not a final appealable

order. Because we conclude that the district court was not clearly

erroneous in finding as a fact that the RJR Settlement was "reached

after the day before the first day of trial," we affirm the district court’s

denial of the adjustment for any monetary payment required by the

First Settlement Agreement. We reverse, however, the district court’s

legal interpretation of the First Settlement Agreement that the RJR

Settlement was not "entered before the beginning of trial." Thus, we

affirm in part and reverse in part.

I

In February 2000, seven tobacco farmers commenced this antitrust

action against Philip Morris, Lorillard, Brown & Williamson Tobacco

Corporation, RJR, and several leaf tobacco dealers, alleging that the

defendants conspired to fix prices at tobacco auctions and to reduce

tobacco growing quotas, in violation of the Sherman Act. The tobacco

4 DELOACH v. LORILLARD TOBACCO CO.
farmers purported to represent a class of hundreds of thousands of

tobacco farmers that the district court certified as a class on April 3,

2002, describing the class as: 

(1) all persons (including corporations and other entities)

holding a quota [under the Federal Tobacco Program] to

grow flue-cured or burley tobacco in the United States at

any time from February 1996 to the present and (2) all

domestic producers of flue-cured or burley tobacco who

sold such tobacco in the United States at any time from February 1996 to the present. 

On May 15, 2003, the tobacco farmers Class and all of the defendants, except RJR, entered into the First Settlement Agreement, and

the district court approved that agreement on October 1, 2003. 

The First Settlement Agreement provided two principal benefits to

the tobacco farmers Class: (1) two cash payments consisting of a first

installment of $135 million and a later conditional installment of $65

million, and (2) a commitment by the settling manufacturers to purchase U.S.-grown leaf tobacco in specified amounts over specified

years. Each of these commitments was subject to a reduction adjustment should the Class enter into a settlement with RJR during a specified period. The second payment of $65 million was subject to a

proportionate reduction if the plaintiff Class "reached" settlement

with RJR "on or before the day before the first day of trial." And the

manufacturers’ agreement to purchase U.S.-grown tobacco was subject to a "most favored nations clause" under which the settling manufacturers’ obligations under the First Settlement Agreement would be

"no less favorable" to them "than those terms agreed to" in any agreement with RJR. The adjustment, however, applied only if a settlement

with RJR was "entered before the beginning of trial." 

Following the district court’s approval of the First Settlement

Agreement on October 1, 2003, the litigation continued against RJR,

and trial was ultimately scheduled to commence on April 22, 2004,

at 9:00 a.m. 

During a settlement conference between counsel for the Class,

counsel for RJR, and the district judge on Friday, April 16, 2004,

DELOACH v. LORILLARD TOBACCO CO. 5
counsel for RJR explained that it had not settled the case earlier

because "we assumed we were going to try the case because the settlement for us late would have been prohibitive. That clause [the most

favored nations clause] ends, as I understand it, the day before the

trial." The court recognized the problem for a settlement, explaining,

"A final agreement, in my opinion, if you reach an agreement, should

come only after the impaneling of the jury." The court stated further

that it saw "nothing wrong[ ] in an attempt to settle this case today,

with an understanding that this case will not be settled, if it is settled,

until next Thursday when we impanel a jury." Later on April 16, after

the court had left the attorneys to discuss settlement further, the parties indicated to the court that they had neared — if not reached —

a tentative settlement. The district judge recalled, about that report: 

I heard that there was some agreement, or each of the parties

at least had indicated, and this was some time later, that an

amount of poundage and an amount of payment was, in fact,

within the realm of what each one of them thought they

could do. I indicated that I thought one of those two figures

was not what it should be, and I asked them to go back and

talk. 

And we came back and talked about the matter. And at that

time, I think [Class counsel] indicated that is where they

were at that point, and then [it] was a matter that he could

take up with his clients. . . . And that after that, both sides

indicated that they, I thought, said, I think we can work this

out. 

The following Monday, April 19, Class counsel assured counsel for

Philip Morris that no settlement with RJR had been reached. Accordingly, as required by the First Settlement Agreement, on April 21 —

the day before the trial was scheduled to commence — Philip Morris

wired the second installment of $65 million to the Class. 

On the morning of April 22 when the jury venire was in the jury

room and the judge in his chambers, the Class and RJR signed the

Second Settlement Agreement at the courthouse and submitted it to

the court. When the district judge entered the courtroom, he stated: 

6 DELOACH v. LORILLARD TOBACCO CO.
Good morning, everybody. I believe that I have heard that

we have some signed papers. I have in chambers just

reviewed some papers, which I find to be in order. And we

will talk more about that in a few moments. But we do have

a number of people waiting upstairs who have given of their

time to be here. 

So, without objection, I’m going to bring those jurors down

at this point and let them go. 

I do believe that the papers are signed now. Is that correct,

Mr. Wiseman? 

When counsel for both parties confirmed that the papers had been

signed, the jury panel was called into the courtroom and told, "[J]ust

about five minutes ago, the parties have signed an agreement in this

case, and the agreement is that they have settled their differences.

. . . For that reason, you are not going to have to serve as a juror in

this case." The court then released the venire. On the same day, the

district court preliminarily approved the RJR Settlement, subject to

the class action notice and final approval procedure. 

The RJR Settlement contained the same two components as were

included in the First Settlement Agreement. RJR agreed to pay the

class $33 million in cash and agreed to purchase from Class members

35 million pounds of tobacco annually for at least 10 years — for a

total of 350 million pounds. The court observed with approval that the

35 million pounds per year RJR agreed to purchase, coupled with the

405 million pounds per year agreed to by the other manufacturers,

provided a total commitment to purchase 440 million pounds of

tobacco each year. 

Because of the RJR Settlement, a week later Philip Morris filed a

motion for the return of its second settlement payment in the amount

of $65 million and for discovery relating to the RJR Settlement, and

both Philip Morris and Lorillard filed notices with the court of the

triggering of the most favored nations clause in the First Settlement

Agreement. They argued that the Class and RJR had reached a settlement on April 16, or at least by April 21, and that even if the RJR SetDELOACH v. LORILLARD TOBACCO CO. 7
tlement had not been entered into until April 22, at that time the trial

had not yet "begun." 

The district court issued an order on June 4, 2004, denying Philip

Morris’s motion for return of the $65 million payment and concluding

that the most favored nations clause had not been triggered. The district court found "that the earliest the settlement was reached was

April 22, 2004, the date on which it was signed," and since this was

"after the day before the first day of trial, [Philip Morris] [was] not

entitled to a reduction of its Second Settlement Payment." With

respect to the most favored nations clause, which would not have

been triggered if the trial had begun, the district court recognized conflicting authority for when a trial "begins" and reasoned that because

there is a public policy against the strict enforcement of most favored

nations clauses, "a settlement entered into on the day trial was scheduled to start, at the time the case was called for trial, with a jury

venire present, was not entered into before the beginning of trial." It

thus rejected all of Philip Morris and Lorillard’s claims for adjustments under the First Settlement Agreement based on the RJR Settlement. 

From the district court’s June 4 order, Philip Morris and Lorillard

filed this appeal. Thereafter, the Class filed a motion to dismiss this

appeal, contending that the First Settlement Agreement bars appellants’ resort to this court for interpretation of the settlement agreement’s terms. They relied on § 4.8 of the First Settlement Agreement,

which provides that any unresolved disputes relating to the tobacco

leaf volume commitments must be brought to the district court for its

"final and non-appealable resolution," and § 12.4(c), which provides

"continuing and exclusive jurisdiction over the Settlement, including

its administration," in the district court. The Class also argues in their

brief that the district court’s order was not an appealable order under

28 U.S.C. § 1291. 

II

At the outset, we address the Class’s motion to dismiss the appeal

based on contractual waiver and an absence of finality of the district

court’s order. We address its arguments in order. 

8 DELOACH v. LORILLARD TOBACCO CO.
A

Pointing to §§ 4.8 and 12.4(c) of the First Settlement Agreement,

the Class contends that the appellants agreed to waive any right to

appeal. The Class argues that these sections evidence the parties’

intent "to streamline dispute resolution through mediation and nonappealable district court resolution." Section 4.8 states that "[i]n the

event of a disagreement regarding . . . compliance with the [tobacco

leaf] volume commitments, the parties shall first engage in mediation.

. . . If the parties are still unable to resolve their disputes, the parties

shall bring the matter to the [district court] for its final and nonappealable resolution." The Class argues that the dispute over the

most favored nations clause is "a disagreement regarding . . . compliance with the [tobacco leaf] volume commitments" that is addressed

in § 4.8. And section 12.4(c) reserves to the district court "continuing

and exclusive jurisdiction over the Settlement, including its administration." The Class argues that "the only construction that here gives

meaning to both ’continuing’ and ‘exclusive’ is one that bars appellate jurisdiction." 

The First Settlement Agreement provides that North Carolina law

governs its interpretation, and the parties agree that we are to apply

North Carolina law. Under that State’s law, as under general principles of contract law, our task is to "give ordinary words their ordinary

meanings." Internet East, Inc. v. Duro Communications, Inc., 553

S.E.2d 84, 87 (N.C. Ct. App. 2001); see also Harris v. Latta, 259

S.E.2d 239, 241 (N.C. 1979) ("In construing contracts ordinary words

are given their ordinary meaning unless it is apparent that the words

were used in a special sense"); Weyerhaeuser Co. v. Carolina Power

& Light Co., 127 S.E.2d 539, 541 (N.C. 1962) ("When the language

of a contract is clear and unambiguous, effect must be given to its

terms, and the court, under the guise of constructions, cannot reject

what the parties inserted or insert what the parties elected to omit").

"If the plain language of a contract is clear, the intention of the parties

is inferred from the words of the contract." Walton v. City of Raleigh,

467 S.E.2d 410, 411 (N.C. 1996); see also Fidelity Bankers Life Ins.

Co. v. Dortch, 348 S.E.2d 794, 796 (N.C. 1986). 

Giving the language of the First Settlement Agreement its ordinary

and natural meaning, we do not read §§ 4.8 and 12.4(c) to support the

DELOACH v. LORILLARD TOBACCO CO. 9
Class’s motion to dismiss. While the most favored nations clause, if

triggered, would affect the volume of appellants’ purchase commitments, this action is not "a disagreement regarding . . . compliance"

with those commitments, as governed by § 4.8. Rather, it is a dispute

over the interpretation of a contractual term in another section of the

agreement. 

Similarly, we conclude, given the provision’s plain language, that

the Class’s reading of § 12.4(c) is too broad. The district court’s

maintenance of "continuing and exclusive jurisdiction" over an agreement is not inconsistent with this court’s exercise of appellate jurisdiction to review the district court’s orders. Cf. Marino v. Pioneer

Edsel Sales, Inc., 349 F.3d 746, 753 (4th Cir. 2003) (discussing "continuing jurisdiction" in terms of a district court’s ability to resolve disputes related to its prior orders); Meade v. Meade, 812 F.2d 1473,

1476 (4th Cir. 1987) (noting that a "presumption of continuing and

exclusive jurisdiction" in one state court discourages resort to the

courts of a second state). Indeed, § 12.4(c) does not include any "nonappealability" language. 

Accordingly, we deny the Class’s motion to dismiss the appeal

based on the contractual language of §§ 4.8 and 12.4(c) of the First

Settlement Agreement. 

B

The Class also asserts that the portion of the district court’s order

addressing the most favored nations clause is not a final judgment

because it does not resolve all claims for all parties. The Class points

to the district court’s continuing administration and "oversight of [the

tobacco] leaf commitments (to which the [most favored nations

clause] relates) and resolution of conflicts thereunder." Moreover, it

notes that the RJR portion of the litigation is still not finally resolved.

First, we note that there are no pending issues about whether settling defendants have complied or will comply with tobacco purchase

commitments. When such an issue arises, if it does arise at all, it will

be addressed by the settlement agreements and by the district court’s

continuing jurisdiction — a jurisdiction that is analogous to a court’s

jurisdiction over an injunction. But the issues before us are not of that

10 DELOACH v. LORILLARD TOBACCO CO.
character. They relate to the discrete issue of whether the RJR Settlement triggers the adjustments provided for in the First Settlement

Agreement. If the district court’s order determining that the provisions of the First Settlement Agreement are not triggered by the RJR

Settlement is a final order with respect to the monetary payment

under the First Settlement Agreement, as the parties seem to agree, it

follows that it is also a final order with respect to the district court’s

determination that the most favored nations clause is not triggered by

the RJR Settlement. For, the interpretation and application of the First

Settlement Agreement will not be subjected to any further trial or

legal analysis by the district court. 

This conclusion is apparent because post-settlement orders, of the

kind before us, resolve completely the post-settlement issues raised

and do not present the same risks for piecemeal appeal that prejudgment orders do. Thus, we agree with the Third Circuit’s approach to

issues arising in connection with settlement agreements, finding it

appropriate "that the requirement of finality be given a ‘practical

rather than a technical construction.’" Plymouth Mut. Life Ins. Co. v.

Ill. Mid-Continent Life Ins. Co., 378 F.2d 389, 391 (3d Cir. 1967)

(quoting Gillespie v. U.S. Steel Corp., 379 U.S. 148, 152 (1964)). The

court there continued, "this is especially so when supplementary postjudgment orders are involved, because the policy against and the

probability of avoidable piecemeal review are less likely to be decisive after judgment than before." Id. The court concluded that an

alleged denial of a bargained-for right in a settlement agreement is

immediately appealable as a final order under 28 U.S.C. § 1291. See

id.

Accordingly, we also reject this ground advanced by the Class to

dismiss this appeal. 

III

On the merits, Philip Morris first contends that the RJR Settlement

was "reach[ed] . . . on or before the day before the day of trial," and

that thereby it was entitled to a payment reduction as provided in the

First Settlement Agreement. Acknowledging that the RJR Settlement

was actually signed on April 22 and therefore "entered" on the first

day of trial, which was scheduled for April 22, Philip Morris argues

DELOACH v. LORILLARD TOBACCO CO. 11
that agreement underlying the RJR Settlement was "reached" on April

16, 2004, or at the latest, on April 21, the day before the first day of

trial. And because agreement was "reached," as distinct from "entered," at the latest on the day before the first day of trial, its second

payment of $65 million is to be reduced as provided in § 2.1.1 of the

First Settlement Agreement. 

Section 2.1.1(B) provides that RJR shall make its second payment

of $65 million "on the day before the first day of trial against any

Non-Settling Defendant," but "in the event that Plaintiffs in the Class

reach settlements with all Non-Settling Defendants, any Second Settlement Payment, as reduced herein, shall be made by Philip Morris

USA 5 days after the last of such settlements receives final approval

by the Court." The reduction of this second payment is provided for

in § 2.1.1(C), which states in full: 

In the event that Plaintiffs and the Class reach settlements

with one or more Non-Settling Manufacturer Defendant(s)

[i.e., RJR] on or before the day before the first day of trial

against any Non-Settling Defendant, the Second Settlement

Payment shall be reduced by 50 cents for each dollar actually received pursuant to such settlement exclusive of legal

fees and costs. Philip Morris USA shall not receive any

refund of its contribution to the First Settlement Payment;

the maximum benefit to Philip Morris USA of this subsection will be to reduce the Second Settlement Payment to

zero. 

(emphasis added). By reason of this provision, Philip Morris asserts

that the RJR Settlement triggered a reduction to which it is now entitled. 

The district court found as a fact that the parties had not "reached"

an agreement until they signed the written document on April 22, and

we review the district court’s factual finding for clear error. See Hensley v. Alcon Labs., Inc., 277 F.3d 535, 541 (4th Cir. 2002). 

As a preliminary matter, we conclude that the words "reaches" and

"enters into" are not used synonymously in the First Settlement

Agreement. Since we treat settlement agreements as contracts, we

12 DELOACH v. LORILLARD TOBACCO CO.
must attempt to "give ordinary words their ordinary meanings." Internet East, 553 S.E.2d at 87; see also Harris, 259 S.E.2d at 241;

Weyerhaeuser Co., 127 S.E.2d at 541. The First Settlement Agreement uses the terms in different circumstances. It provides that it "is

entered into this 15th day of May"; that "this Agreement has been

reached as a result of the mediation efforts, subject to the preliminary

approval of the Court and Final Approval"; and, that "it is in the best

interest of the Class to enter into this Agreement." (Emphases added).

These uses of "enters into" and "reaches" indicate that "enters into"

equates with "executes," and "reaches" refers to the process of coming

to an agreement, a conclusion that is reenforced by the tenses used

with the various terms. This use of the terms, moreover, is consistent

with dictionary meanings. Webster, for example, defines "reach" as

"to arrive at[,] get up to or as far as[, or] come to" and defines "enter

into" as "to make oneself a party to or in." Webster’s Third New

International Dictionary 757, 1888 (Merriam-Webster, Inc. ed.,

1993). 

Thus, while we agree with Philip Morris that the terms "reached"

and "entered into" have been used differently, see, e.g., NationsBank

of N.C., N.A. v. Am. Doubloon Corp., 481 S.E.2d 387, 389 (N.C. Ct.

App. 1997) (using the terms distinctly), our review of the evidence in

this case nonetheless leads us to conclude that the district court was

not clearly erroneous in finding that the RJR Settlement was neither

reached nor entered into prior to April 22. 

To determine whether a settlement agreement has been reached, we

look "to the objectively manifested intentions of the parties." Moore

v. Beaufort County, N.C., 936 F.2d 159, 162 (4th Cir. 1991). As the

district court noted, details remained to be worked out as of April 16,

and "the magnitude of this settlement was such that the sophisticated

parties involved would never have reached a final agreement without

a signed writing." In addition, the district court made much of the language of the signed RJR Settlement agreement, including the fact that

it names April 22 as the effective date and includes a merger clause

indicating an intent not to be bound by any previous agreements.

While these might not be conclusive indications that the Class and

RJR had not come to an agreement before April 22, we cannot conclude on the record before us that the district court’s finding was

clearly erroneous. 

DELOACH v. LORILLARD TOBACCO CO. 13
Because we affirm the district court’s finding that the RJR Settlement was not reached "on or before the day before the first day of

trial," Philip Morris is not on this basis entitled to a return or reduction of its second settlement payment made to the Class. 

IV

Referring to different language in the First Settlement Agreement,

Philip Morris and Lorillard contend that the RJR Settlement was "entered before the beginning of trial" and that thereby they were entitled, under the most favored nations clause, to a reduction of their

tobacco purchase obligations. Noting that when the RJR Settlement

was signed, the jury selection process had not yet begun, they argue

that jury selection is "the earliest that any court has determined a civil

trial to commence." They point in particular to the North Carolina

Supreme Court’s statement in Pratt v. Bishop, 126 S.E.2d 597 (N.C.

1962), defining when a trial commences. That court stated: 

When a trial commences is a difficult question, and the

answer may vary according to the statute being construed

and according to the circumstances in a particular case. "In

general, it has been held that the trial begins when the jury

are called into the box for examination as to their qualifications — when the work of impaneling the jury begins —

and that the calling of a jury is part of the trial." 53 Am-Jur.,

Trial, Section 4. . . . Once the case is reached on the calendar and the jury called into the box, "the hurry of a trial" has

begun . . . . 

Id. at 610. 

Finding no clear and consistent precedent for when a trial begins,

the district court held that the parties’ intent, revealed by the overall

context of the First Settlement Agreement, generally anticipated a

triggering point at some time in the "period between the First Settlement and the starting date of trial." Believing that this intent was a

more generalized idea of when the trial began than that urged by

Philip Morris and Lorillard, the court held that "a settlement entered

into on the day trial was scheduled to start, at the time the case was

14 DELOACH v. LORILLARD TOBACCO CO.
called for trial, with a jury venire present, was not entered into before

the beginning of trial." 

Arguing in support of this interpretation, the Class observes that

trial was scheduled to commence at 9:00 a.m. on April 22, 2004, and

that the RJR Settlement Agreement was not signed until "approximately 9:30 a.m., well after the scheduled start of trial." Reiterating

the district court’s analysis, the Class contends that because there is

"no uniform definition of when trial begins," the district court was

free to conclude, as a matter of legal interpretation, that the beginning

of trial simply meant the scheduled start of trial. The Class points to

the example where a rule requires that an act be accomplished a specific number of days "before trial," see, e.g., M.D.N.C. R. 40.1, and

argues that the rule must be referring to the scheduled trial date. 

The facts relevant to resolution of this issue are not in dispute. On

the day scheduled for trial — April 22, 2004 — the parties to the RJR

Settlement signed the written agreement in the courthouse. At the

time that the agreement was signed, the jury was in the jury room

waiting for trial to begin, and the district judge was in his chambers.

When the judge entered the courtroom to begin trial, it was clear that

at that time the RJR Agreement had already been signed. As the judge

stated, after saying good morning, "I have heard that we have some

signed papers." To confirm that, the district judge addressed counsel

for both parties, inquiring whether the RJR Agreement had been

"signed now," and both counsel responded affirmatively. The jury,

which was still outside of the courtroom, was called into the courtroom and advised, "Just about five minutes ago," the parties signed a

settlement agreement. 

With these facts, the question is whether the RJR Settlement was

signed "before the beginning of trial," as that term is used in the First

Settlement Agreement. This is a question of law that we review de

novo. See Williams v. Prof’l Transp. Inc., 294 F.3d 607, 613 (4th Cir.

2002). 

The provision of the First Settlement Agreement in question, § 7.1,

is included under the heading "Most Favored Nations Clause" and

reads: 

DELOACH v. LORILLARD TOBACCO CO. 15
In recognition of, among other things, Philip Morris USA’s,

Lorillard’s and B&W’s role as the first defendants to settle

and their lead roles in initiating and pursuing settlement,

Plaintiffs and the Class agree that certain terms of this

Agreement shall be no less favorable to Philip Morris USA,

Lorillard and B&W than those terms agreed to in future settlements with any Non-Settling Manufacturer Defendant.

. . . This Section 7 [most favored nations clause] applies

only to settlements entered before the beginning of trial, but

not to any settlements entered thereafter. Plaintiffs’ Co-Lead

Counsel presently intend to conclude any trial commenced

against a Non-Settling Manufacturer Defendant [RJR]. 

(Emphasis added). The highlighted phrase is the language at issue

here. 

Although the beginning of trial is a specific and identifiable

moment, that moment may depend on the particular trial that is being

conducted and the issue for which the "beginning" must be determined. The beginning of a federal court trial may be different from

the beginning of a state court trial; the beginning of a civil trial may

be different from the beginning of a criminal trial; the beginning of

a jury trial may be different from the beginning of a court trial; and

the beginning of a court trial may be different from the beginning of

an arbitration. And even within any given type of trial, the "beginning" may be different for each issue for which it must be determined.

For example, in the criminal context, jeopardy does not attach for

double jeopardy purposes "until a defendant is ‘put to trial before the

trier of facts.’" Serfass v. United States, 420 U.S. 377, 388 (1975)

(quoting United States v. Jorn, 400 U.S. 470, 479 (1971)). This

occurs "when a jury is empaneled and sworn" or, in a nonjury trial,

"when the court begins to hear evidence." Id.; see also United States

v. Shafer, 987 F.2d 1054, 1057 (4th Cir. 1993). For purposes of the

Federal Speedy Trial Act, however, we have held that the criminal

trial commences with voir dire. See United States v. A-A-A Elec. Co.,

788 F.2d 242, 246 (4th Cir. 1986); see also United States v. Whitaker,

722 F.2d 1533, 1535 (11th Cir. 1984); United States v. Manfredi, 722

F.2d 519, 524 (9th Cir. 1983); United States v. Howell, 719 F.2d

1258, 1262 (5th Cir. 1983); United States v. New Buffalo Amusement

Corp., 600 F.2d 368, 376 (2d Cir. 1979). With respect to an offer of

16 DELOACH v. LORILLARD TOBACCO CO.
judgment in a civil case under Federal Rule of Civil Procedure 68,

which provides that, "at any time more than 10 days before the trial

begins, a party defending against a claim may serve upon the adverse

party an offer to allow judgment to be taken against the defending

party" (emphasis added), a district court has observed: 

[A]lthough a trial may formally "begin" with the selection

of the jury for some purposes, for the purpose of Rule 68,

the trial begins when the trial judge calls the proceedings to

order and actually commences to hear the case. Where . . .

the impanelling of a jury precedes the presentation of evidence and arguments by several weeks or months, this interpretation furthers the policy of Rule 68 by permitting offers

of judgment to be made, and perhaps accepted, in the intervening period.

Greenwood v. Stevenson, 88 F.R.D. 225, 229 (D.R.I. 1980). Thus, the

beginning of trial may be determined not only by the specific type of

trial at issue but also by the issue to which that determination might

relate. 

As a general matter, it cannot be disputed that a "trial" is the judicial proceeding during which the law and the facts are examined to

determine the issues between the parties. Accordingly, the beginning

of this proceeding must be the first meaningful act in actually conducting the proceeding. And depending on the issue for determining

what the first meaningful act is, the beginning of trial may be when

the court calls the proceeding to order; or when the court calls the

proceeding to order and all of the actors are present in the courtroom,

including the jury venire; or when the process for the selection of the

jury begins; or when the jury is impaneled; or when the opening statements are made; or when the first witness is called. Regardless of

which act is the relevant meaningful act, no suggestion has been made

that a trial ever begins before the judge first enters the courtroom to

begin the trial proceedings. See, e.g., Greenwood, 88 F.R.D. at 229;

Pratt, 126 S.E.2d at 610. 

Because of the undisputed facts relevant here, we need not fix on

any one meaningful act to describe the beginning of trial because the

RJR Settlement was indisputably signed even before the district judge

DELOACH v. LORILLARD TOBACCO CO. 17
entered the courtroom to begin the trial. We therefore conclude that

the RJR Agreement was signed (or "entered") before the beginning of

trial. Under the First Settlement Agreement, this means that the most

favored nations clause was triggered. 

The district court had well-considered pragmatic reasons for reaching its conclusion on this issue, but in doing so it meaningfully

rewrote the First Settlement Agreement by interpreting the "beginning

of trial" to mean "the day trial was scheduled to start." This was error,

and accordingly we reverse this ruling. 

V

In summary, we deny the Class’s motion to dismiss; we affirm the

district court’s finding that agreement on the RJR Settlement Agreement was reached on April 22, 2004, and its ruling that therefore the

reduction of the second payment under the First Settlement Agreement was not triggered; and we reverse the district court’s ruling that

the RJR Agreement was not entered before the beginning of trial and

that the most favored nations clause therefore was not triggered. 

AFFIRMED IN PART AND REVERSED IN PART

18 DELOACH v. LORILLARD TOBACCO CO.