defending rule 30(b)(6) corporate...
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Defending Rule 30(b)(6) Corporate Depositions Responding to a Deposition Notice, Selecting and Preparing Witnesses
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THURSDAY, APRIL 18, 2013
Presenting a live 90-minute webinar with interactive Q&A
Bradley W. Petersen, Partner, Slattery Petersen, Phoenix
Ardith Bronson, Counsel, Weil Gotshal & Manges, Miami
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Brad Petersen, Slattery Petersen PLLC 602.507.6100 [email protected] www.slatterypetersen.com Ardith Bronson, Weil, Gotshal & Manges LLP 305.577.3213 [email protected] www.weil.com/ardithbronson/
Rule 30(b)(6) Corporate Depositions: Effective Defense Strategies
April 18, 2013
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Introduction
Party seeking information from a corporation may serve a notice requiring the corporation to designate a person to testify in a deposition on specified topics
Such notices:
Are referred to as corporate designee or 30(b)(6) notices
Impose various obligations on the corporation
Present numerous issues for the corporation
This seminar will:
Identify those obligations and issues
Discuss practical responses to them
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The Language of Rule 30(b)(6)
“A party may ... name as the deponent a public or private corporation or a partnership or association or governmental agency and describe with reasonable particularity the matters on which examination is requested.... [T]he organization so named shall designate one or more officers, directors, or managing agents, or other persons who consent to testify on its behalf, and may set forth, for each person designated, the matters on which the person will testify. The person so designated shall testify as to matters known or reasonably available to the organization....”
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The Rationale For Rule 30(b)(6)
Reduce the difficulty a deposing lawyer encounters in determining whether a particular employee of a corporation is a “managing agent”
Curb the practice of “bandying”
Protect entities from the burden of having an unnecessarily large number of their employees deposed
The comments to FRCP 30(b)(6) indicate 3 reasons for its enactment:
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Common Uses of 30(b)(6) Depositions
Seek factual information to support claims or defenses
Discover the company’s:
Position with respect to disputed matters Subjective beliefs and opinions Interpretation of documents and events
Authenticate documents
Probe e-discovery issues, including compliance
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Use of 30(b)(6) Deposition Testimony
FRCP 32(a)(2) provides:
“The deposition of a party or of anyone who at the time of taking the deposition was an officer, director, or managing person designated under Rule 30(b)(6) or 31(a) to testify on behalf of a public or private corporation, partnership or association or governmental agency which is a party may be used by an adverse party for any purpose.” (emphasis added)
Predominant view:
30(b)(6) testimony is not a judicial admission
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Key 30(b)(6) Issues
Responding to the Deposition Notice
Selecting the 30(b)(6) Witness
Preparation for the Deposition
Problem Areas and What to Do About Them
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Responding to the Deposition Notice
Preliminary Issues to Consider
Is the notice procedurally proper?
If the corporation is not a party:
Does a subpoena accompany the notice?
Does the issuing court have jurisdiction?
Does the serving party obtain the proper commissions?
Does the notice satisfy rule requirements?
E.g., does it clearly identify the topics for designation?
Was service proper?
Does the notice provide required time to respond?
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Responding to the Deposition Notice
Preliminary Issues Continued
If defective, challenge, ignore or accept the notice?
Ignoring the notice is dangerous
Court may disagree that the notice is defective
This tactic will increase hostility with serving party
May accomplish little; the party can re-serve notice
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Responding to the Deposition Notice
Preliminary Issues Continued
Accepting the notice may be best option if:
Defect is debatable or just technical in nature
Little is at stake for the corporation
You want to avoid fees of the challenge
You can get greater cooperation from serving party
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Responding to the Deposition Notice
Addressing The Notice
Does the corporation have responsive information? If so, must present a witness to testify If not, may be able to negotiate with serving party
Is the requested information protected? Information may be protected if it is:
Covered by attorney/client privilege, work product
A trade secret If information is protected, you may:
Try to avoid deposition through negotiation; or
Seek protective order from court; or Attend deposition and object to questions
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Responding to the Deposition Notice
Is the request vague, ambiguous or overly burdensome?
A notice may be if:
If the deposition topics are very broad
If the number of requested documents is large
If collecting the information would entail great cost
If the notice is overly burdensome, you may:
Call the noticing attorney and negotiate to work out an agreed resolution that is reduced to writing; get an amended notice
Serve objections
Move for protective order or to quash
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Responding to the Deposition Notice
Should you serve objections?
Counsel should always review the notice immediately and carefully to identify:
All potential objections
Topics for which the corporation has no information
Any limitations on testimony that will be given
Whether objections are served or filed depends largely on jurisdiction and judge but regardless may be used as a tool for negotiations
Often times, serving objections does nothing unless presented in motion for ruling by the court
Waiting to object to topics at deposition may be too late
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Responding to the Deposition Notice
Should you move for a protective order or to quash?
In many jurisdictions, this is the only safe harbor for resolving issues in the notice as to vagueness, ambiguity, and burden that may be foreseen before the deposition
When issues arise during deposition and cannot be resolved by talking to opposing counsel, it may be necessary to suspend the deposition and make a motion
Know how your judge wants to resolve
There could be costs
Try to resolve by negotiating particularly if the issue regards something about which you intend to offer evidence at trial and the corporation has the information
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Responding to the Deposition Notice
Should you serve your own 30(b)(6) notice?
This is only applicable to a party in a suit
You may wish to serve such a notice to:
Obtain leverage in negotiating scope of notice
Restrict demands, expectations of other side
Positively influence behavior during the deposition
If you do, avoid the mistakes discussed above.
Remember the number one rule of litigation: what goes around, comes around.
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Selecting the 30(b)(6) Witness
Whom to consider? Current Employee Former Employee Expert Others Multiple Witnesses
Rule 30(b)(6) provides that the organization:
“… designate[s] one or more officers, directors, or managing agents, or other person who consent to testify on its behalf, and may set forth, for each person designated, the matters on which the person will testify.” (emphasis added)
Selecting the 30(b)(6) Witness
Keep in Mind How 30(b)(6) Testimony Can Be Used:
Testimony is treated as an evidentiary, not judicial, admission
While testimony may be explained or rebutted, consider how effective that will be at trial
Can be explained or rebutted only if the information was not available at time of deposition
Testimony may be used against organization at trial
Organization, however, may not be able to use testimony at trial unless witness has personal knowledge of matters or offers expert testimony
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Selecting the 30(b)(6) Witness
Consider the duties under 30(b)(6):
An organization from which a Rule 30(b)(6) has been requested, whether that be by notice or subpoena, has several duties: be knowledgeable, to prepare, to designate more, and to supplement.
Courts generally view these burdens as the “concomitant obligation from the privilege of being able to use the corporate form in order to conduct business.”
An organization is not required to designate someone with “personal knowledge” to appear on its behalf. This is not a “PMK” deposition.
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Selecting the 30(b)(6) Witness
Consider the scope of the deposition:
If your jurisdiction is one that allows questions beyond the scope of topics, regardless of your objection, if the witness has personal knowledge of and answers, it may still be an admission
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Selecting the 30(b)(6) Witness Considerations for Selection
Witness Considerations:
Witness’s prior experience testifying
Witness’s personal knowledge
Organization’s interest in having someone with personal knowledge testifying
Time and resources of counsel and witness to become knowledgeable through preparation
Access to company resources, including present and former employees
Witness as “the face of the company”
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©2010 Snell & Wilmer
L.L.P.
Kaufman FU Deposition (YouTube)
Selecting the 30(b)(6) Witness More Considerations for Selection
Witness’s temperament and patience, particularly given the characteristics of the taking attorney
Witness’s knowledge of other facts that could be the subject of the deposition
Witness’s ties to “bad company documents” produced in this or other litigation
Privilege concerns with attorney as witness
Multiple Depositions
More efficient, less risky to depose witness only once
Time limits help reduce deposition risk
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Selecting the 30(b)(6) Witness
Less Knowledge = More Time, More Work, More Expense, More Risk
Lack of personal knowledge is no defense
Keep records and prepare witnesses regarding all steps taken
Avoid the “I don’t know” response
Make sure witness knows the risk of not answering questions
Make sure you know and prepare the witness for the 10 worst questions in your case
Prepare for and plan to do a direct examination
1 witness = 7 hours, 2 witnesses = 14 hours
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Preparation for the Deposition
Must you educate the witness?
The witness is to provide the company’s knowledge
You must educate witness to key facts the witness does not know
There may be limits to what a witness can learn
There may be limits to questions you can anticipate
However, you must try to educate witness to relevant facts
There are risks to a witness not knowing information
A party may not be able to put on evidence at trial
A party may not be able to assert certain positions
Risks are much smaller if the company is not a party
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Preparation for the Deposition
What should you do to educate the witness?
Depending on the situation, you may:
Have the witness review key documents
Have the witness speak to knowledgeable employees
Have the witness speak to former employees
You must show that the witness was prepared
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Preparation for the Deposition
What the witness reviews is discoverable
Do not have witness review privileged material
Be careful in selection of documents
You may not want to highlight certain documents
Be careful in selecting others who witness interviews
You may not want to highlight certain witnesses
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Preparation for the Deposition
When should you prepare “cheat sheets”?
Sometimes it is helpful to prepare “cheat sheets”
Facts on which the witness can rely in the deposition
Makes sense to do so when:
Important that the witness provide certain testimony
Information too much or complex for witness to remember
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Preparation for the Deposition
Should you do a direct examination?
No obligation to put on case, but consider how the deposition may be used in this and future litigation
Potentially make a record of preparation
If it is even a possibility, prepare
Make sure the witness knows it is coming
Assure witness that your questions do not mean the witness did something wrong
Problem areas
The most common problem (at least, anecdotally):
The witness was not knowledgeable and/or prepared to testify for the organization!
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Recent Company Dep.
53
8 Q On Exhibit 1 the topics of examination
9 start, "All final or draft protocols prepared or
10 used for the XC90 dolly rollover tests run at
11 Karco." When The Engineering Institute was working
12 with Karco to run the XC90 dolly rollover tests,
13 were any final or draft protocols prepared?
14 A I believe so.
15 Q Where are those today?
16 A They're probably in our server.
17 Q Have you tried to identify those
18 documents?
19 A No, I have not.
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Recent Company Dep.
39
19 Q (BY MR. PETERSEN) What about the
20 protocols used for the other testing of this glass
21 that's described in Exhibit No. 1?
22 A What test are we talking about?
23 Q I'm talking about any test run with the
24 glass described within Exhibit No. 1. Have you
25 been able to identify any testing protocols, test
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1 plans, test budgets, related to testing, any
2 testing, of the glass described within Exhibit 1?
3 A I would have to look into that and get
4 with Steve and find those documents.
5 Q You have not done that prior to today?
6 A No. 35
Recent Company Dep.
12 Q (BY MR. PETERSEN) You said you have an
13 idea where these documents might be located in
14 response to Mr. Hall's question. What's your idea
15 of where they're located?
16 A Saved on the server probably. I would
17 have to get with Linda and Steve. I don't where he
18 stores his stuff.
19 Q Is there any reason why y'all couldn't
20 have done that, gotten together with Linda and
21 Steve and looked at the server in the months
22 between November of 2010 and July of 2011?
23 MR. HALL: Objection, form.
24 A I don't know.
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Recent Company Dep.
23 Q Who paid for the HYGE sled testing?
24 A I believe that was internal testing.
25 Q That wasn't charged out to any clients?
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1 A I don't know.
2 Q Who would know?
3 A Steve Batzer.
4 Q In the production of that testing in cases
5 has the Engineering Institute billed for the
6 production of that testing, the HYGE sled testing?
7 A I don't know.
8 Q Who wound know?
9 A Steve Batzer.
10 Q Did you ask Dr. Batzer about those
11 questions before today's deposition?
12 A No, I did not. 37
Problem areas
What happens when the deponent is not
knowledgeable:
Like all depositions, if a party fails to appear for a Rule 30(b)(6) deposition, it may be subject to sanctions.
Similarly, if a party proffers a representative who cannot properly answer questions on matters adequately described in the notice for which that representative was designated to give testimony, then the party has failed to comply with its obligations under Rule 30(b)(6) and is also subject to sanctions.
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Problem areas
• Some possible sanctions under Rule 37:
Preclusion of evidence on subject matter;
Produce new designee at deponent’s expense; or
Educate and reproduce designee.
You cannot produce an unknowledgeable 30(b)(6)
deponent and then substitute a knowledgeable witness at
the time of trial.
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Problem Areas and What to Do About Them
How to handle lack of witness knowledge:
Prepare, Prepare, Prepare
Seek sources during the break
Reconvene deposition if necessary
How to handle inaccurate / incomplete testimony:
Be prepared to cross/ rehabilitate your witness
Review/edit the transcript
Problem areas
Other problems:
Too much information!
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Burden is No Excuse
Even if corporate documents are voluminous and the review of those documents would be burdensome, a representative may still be required to review them in order to prepare for the deposition; such preparation is necessary because the individuals so deposed are required to testify to the knowledge of the corporation, not the individual. Calzaturficio S.C.A.R.P.A. s.p.a. v. Fabiano Shoe Co., 201 F.R.D. 33 (D. Mass. 2001).
In one case, an organization spent more than 1650 hours preparing representatives only to have those witnesses offer inadequate testimony that necessitated further depositions. Federal Deposit Insur. Corp. v. Butcher, 116 F.R.D. 196, 201 (E.D. Tenn. 1986). Note that the FDIC was suing for $40 Million.
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Problem areas
Other problems:
Not enough information!
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No Duty to Know Answer to Every Question
Plaintiffs in products liability action involving loader manufactured in 1969 were not entitled to a deposition of another corporate designee based on alleged inadequacy of responses; due to age of loader, it could be anticipated that certain information concerning it would be unavailable, and original designee was manager of team that designed equipment, and possibility that his memory may have faded due to mere passage of time did not justify requiring manufacturer to appoint additional designee. Barron v. Caterpillar, Inc., 168 F.R.D. 175 (E.D. Pa. 1996).
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Problem Areas and What to Do About Them
How to handle questions beyond the scope:
Establish the scope ahead of time
Make the objection
If necessary, instruct the witness not to respond (privilege, bad faith, court limits)
Seek protective order if necessary
Final Suggestions for the Defending Attorney
Study the notice carefully and generate important or troublesome questions that will need to be addressed. Object early.
If necessary, seek relief under Rule 26(c) prior to the deposition, especially when work product or privilege may be an issue.
Prepare, prepare, prepare!
Explain to the representative the risks of not answering.
If the representative provides an “I don’t know answer” to a question that should be covered, offer additional witnesses or take a break and educate. You do not want to risk getting locked out of a claim or defense at trial.
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Final Suggestions for the Defending Attorney
Work with the taking attorney to get appropriate agreements, like proffering an initial witness with others to follow, if necessary. Confirm this on the record.
Have additional witnesses ready to address those areas that may not have been contemplated but are within the notice.
Make a record. Clearly set forth all stipulations on the record and indicate which areas of inquiry the representative will be addressing. When taking counsel goes beyond the noticed areas, remind taking counsel that the responses may not be binding and consider seeking Rule 26(c) relief from the court.
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Rule 30(b)(6) Cases
Suss v. MSX Int’l Services, Inc., 212 F.R.D. 156 (S.D.N.Y. 2002)
Calzaturficio S.C.A.R.P.A. v. Fabiano Shoe Co., 201 F.R.D. 33 (D. Mass. 2001)
Reed v. Bennett, 193 F.R.D. 689 (D. Kan. 2000)
Prokosch v. Catalina Lighting, Inc., 193 F.R.D. 633 (D.Minn. 2000)
Reilly v. Natwest Mkts. Group Inc., 181 F.3d 253 (2nd Cir. 1999)
Starlight Int’l Inc. v. Herlihy, 186 F.R.D. 626 (D. Kan. 1999)
Media Services Group, Inc. v. Lesso, Inc., 45 F. Supp. 2d 626 (D. Kan. 1999)
Alexander v. FBI, 186 F.R.D. 148, 151 (D.D.C. 1999)
Rainey v. Amer. Forest and Paper Assoc., 26 F. Supp. 2d 82 (D.D.C. 1998)
Bank of New York v. Meridien BIAO Bank Tanzania, Ltd., 171 F.R.D. 135 (S.D.N.Y. 1997)
Barron v. Caterpillar, Inc., 168 F.R.D. 175 (E.D. Pa. 1996)
U.S. v. Taylor, 166 F.R.D. 356, affirmed, 166 F.R.D. 367 (M.D.N.C. 1996)
In re Indep. Service Orgs. Antitrust Litig., 168 F.R.D. 651, 654 (D. Kan. 1996)
Buycks-Roberson v. Citibank Federal Savings Bank, 162 F.R.D. 338 (N.D. Ill. 1995)
King v. Pratt & Whitney, 161 F.R.D. 475 (S.D. Fla. 1995)
Marker v. Union Fidelity Life Ins. Co., 125 F.R.D. 121 (M.D.N.C. 1989)
FDIC v. Butcher, 116 F.R.D. 196 (E.D. Tenn. 1986)
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Brad Petersen, Slattery Petersen PLLC 602.507.6100 [email protected] www.slatterypetersen.com Ardith Bronson, Weil, Gotshal & Manges LLP 305.577.3213 [email protected] www.weil.com/ardithbronson/
Rule 30(b)(6) Corporate Depositions: Effective Defense Strategies
April 18, 2013