Earlier quoted context omitted.
"Reply-all" suggests that the same mail went to a set of recipients, but doesn't the watermarking strategy require each recipient to have their own unique copy?
Recipient A gets their personalized copy, as does recipient B Recipient A then clicks reply-all, now everyone has copy that was personalized to A. They might even notice subtle differences between them.
Edit: WP has the Tesla story with the counsel forwarding his copy to everyone in a new mail (presumably trying to be helpful?) So not a case of reply-all disease