Duty to Produce a 30(b)(6) Designee

A corporation may be deposed through rule 30(b)(6), whether in state or federal courts.  This does not require the corporation to produce “the person most knowledgeable” on a topic, but instead a designee who can adequately testify to the topics listed in the deposition notice.

I had planned a post on this topic discussing the usual problems that arise when a 30(b)(6) deposition is noticed.  Then I found MJ Leen’s unpublished order in Elan Microelectronics Corp. v. Pixcir Microelectronics Co. Ltd., 2013 U.S. Dist. LEXIS 114164, 2013 WL 4101813 (D. Nev. August 13, 2013) on this exact point. I read it and gave up.  Why bother trying to write the legal summary any better than this?

The purpose of the rule is to streamline the discovery process. Resolution Trust Corp. v. Southern Union Co., Inc., 985 F.2d 196, 197 (5th Cir.1993). It serves a unique function in allowing for a specialized form of deposition. Sprint Comm’ns Co., L.P. v. Theglobe.com, Inc., 236 F.R.D. 524, 527 (D. Kan. 2006). The rule “gives the corporation being deposed more control by allowing it to designate and prepare a witness to testify on the corporation’s behalf.” U.S. v. Taylor, 166 F.R.D. 356, 360 (M.D.N.C.1996). It is a discovery device employed by the examining party “to avoid the ‘bandying’ by corporations where individual officers disclaim knowledge of facts clearly known to the corporation.” Id. Or, as another district court articulated, “One of the purposes of Rule 30(b)(6) is to curb any temptation a corporation might have to shunt a discovering party from “pillar to post” by presenting deponents who each disclaim knowledge of facts clearly known to someone in the organization.” Federal Deposit Ins. Corp. v. Butcher, 116 F.R.D. 196, 199 (E.D. Tenn. 1986).

Rule 30(b)(6) imposes burdens on both the discovering party and the designating party. The party seeking discovery through a Rule 30(b)(6) deposition is required to describe “with reasonable particularity the matters on which examination is requested.” Fed.R.Civ.P. 30(b)(6). Once served with a deposition notice under Rule 30(b)(6), the responding party is required to produce one or more witnesses knowledgeable about the subject matter of the noticed topics. Marker v. Union Fidelity Life Insurance Company, 125 F.R.D. 121, 126 (M.D.N.C.1989).

The testimony of a Rule 30(b)(6) designee “represents the knowledge of the corporation, not of the individual deponents.” Taylor, 166 F.R.D. at 361; Hyde v. Stanley Tools, 107 F.Supp.2d 992 (E.D. La., 2000); Sprint, 236 F.R.D. at 527.  A Rule 30(b)(6) designee presents the corporation’s position on the noticed topics. United States v. Massachusetts Indus. Finance Agency, 162 F.R.D. 410, 412 (D. Mass.1995). A corporation has a duty under Rule 30(b)(6) to provide a witness who is knowledgeable in order to provide “binding answers on behalf of the corporation”. Starlight International, Inc. v. Herlihy, 186 F.R.D. 626, 638 (D. Kan.1999). A Rule 30(b)(6) designee is not required to have personal knowledge on the designated subject matter. Sprint, 236 F.R.D. at 528; PPM Finance v. Norandal, 297 F.Supp.2d 1072, 1085-86 (N.D. Ill., 2004); Calzaturficio v. Fabiano Shoe Co., Inc., 201 F.R.D. 33, 37 (D. Mass.2001).

The designating party has a duty to designate more than one deponent if necessary to respond to relevant areas of inquiry on the noticed topics. Id.; Barron v. Caterpillar, Inc., 168 F.R.D. 175, 176 (E.D.Pa.1996); Starlight, 186 F.R.D. at 638 (corporation must produce “such number of persons as will satisfy the request”); In re: Vitamins Antitrust Litigation, 216 F.R.D. 168, 172 (D.D.C.2003); Securities & Exchange Comm’n v. Morelli, 143 F.R.D. 42, 45 (S.D.N.Y.1992); Reilly v. Natwest Markets Group, Inc., 181 F.3d 253, 268 (2d Cir.1999).

Rule 30(b)(6) is not designed to be a memory contest. Bank of New York v. Meridien BIAO Bank Tanzania Ltd., 171 F.R.D. 135, 150 (S.D.N.Y.1997). However, a corporation has “a duty to make a conscientious, good-faith effort to designate knowledgeable persons for Rule 30(b)(6) depositions and to prepare them to fully and unevasively answer questions about the designated subject matter.” Starlight, 186 F.R.D. at 639; Dravo Corp. v. Liberty Mut. Ins. Co., 164 F.R.D. 70, 75 (D.Neb.1995) (“If the rule is to promote effective discovery regarding corporations, the spokesperson must be informed.”); In re: Vitamins Antitrust Litigation, 216 F.R.D. at 172 (corporation is obligated to produce one or more Rule 30(b)(6) witnesses who are thoroughly educated about the noticed deposition topics and facts known to the corporation or its counsel).

The duty to prepare a Rule 30(b)(6) designee goes beyond matters personally known to the witness or to matters in which the designated witness was personally involved. Buycks-Roberson v. Citibank Federal Sav. Bank, 162 F.R.D. 338, 343 (N.D. Ill.1995); Securities and Exchange Commission v. Morelli, 143 F.R.D. 42, 45 (S.D.N.Y.1992). The duty to produce a prepared witness on designated topics extends to matters not only within the personal knowledge of the witness but on matters reasonably known by the responding party. Alexander v. Federal Bureau of Investigation, 186 F.R.D. 137, 141 (D.D.C.1998). “By its very nature, a Rule 30(b)(6) deposition notice requires the responding party to prepare a designated representative so that he or she can testify on matters not only within his or her personal knowledge, but also on matters reasonably known by the responding entity.” Alliance v. District of Columbia, 437 F. Supp. 2d 32, 37 (D.D.C.2006) (internal citation omitted).

The fact that an organization no longer has a person with knowledge on the designated topics does not relieve the organization of the duty to prepare a Rule 30(b)(6) designee. Taylor, 166 F.R.D. at 361. There, the court recognized that it is not uncommon to find that a corporation no longer employs individuals who have memory of distant events, or to find that individuals with knowledge are deceased. Id. “These problems do not relieve a corporation from preparing its Rule 30(b)(6) designee to the extent matters are reasonably available, whether from documents, past employees, or other sources.” Id. A party producing a Rule 30(b)(6) witness “must prepare deponents by having them review prior fact witness deposition testimony as well as documents and deposition exhibits.” Id. at 362.

The Federal Rules of Civil Procedure do not permit a party served with a Rule 30(b)(6) deposition notice or subpoena request “to elect to supply the answers in a written response to an interrogatory” in response to a Rule 30(b)(6) deposition notice or subpoena request. Marker v. Union Fidelity Life Insurance, 125 F.R.D. 121, 126 (M.D.N.C.1989). “Because of its nature, the deposition process provides a means to obtain more complete information and is, therefore, favored.” Id. Similarly, in responding to a Rule 30(b)(6) notice or subpoena, a corporation may not take the position that its documents state the company’s position. In re: Vitamins Antitrust Litigation, 216 F.R.D. at 172, 174. There, the defendants produced a timeline of events relevant to the litigation based on interviews of former employees and a review of accompanying documents and took the position at a Rule 30(b)(6) deposition that because statements of former employees are imputed to the company by operation of law, the timelines “spoke for themselves” and the corporation need not produce a Rule 30(b)(6) deponent to provide an explanation. The court rejected this argument, stating:

Bioproducts’ objection rests on a misinterpretation of Rule 30(b)(6) and a mistaken view that mere authentication of the documents submitted with a corresponding disavowal of the truth or accuracy of the documents is sufficient to satisfy the requirements of Rule 30(b)(6) …. [there is] nothing in the rules or caselaw that would justify [such an] understanding of a sufficient Rule 30(b)(6) deposition.

Id. at 172.

Several courts have recognized that preparing a Rule 30(b)(6) designee may be an onerous task and that it is not uncommon for a corporation to claim:

… that it no longer employs individuals who have memory of a distant event or that such individuals are deceased…. These problems do not relieve a corporation from preparing its Rule 30(b)(6) designee to the extent matters are reasonably available, whether from documents, past employees, or other sources.

Taylor, 166 F.R.D. at 360-61 (internal citations omitted). Although adequately preparing a Rule 30(b)(6) deposition can be burdensome, “this is merely the result of the concomitant obligation from the privilege of being able to use the corporate form in order to conduct business.” Id. at 362. Sprint, 236 F.R.D. at 528 (acknowledging compliance with Rule 30(b)(6) may be onerous but that the Rule’s requirements “negate any possibility that an inquiring party will be directed back and forth from one corporate representative to another, vainly searching for a deponent who is able to provide a response which would be binding on that corporation.”)

Finally, if an organization designates a witness it believes in good faith would be able to provide knowledgeable responsive testimony and it becomes apparent during the deposition that the designee produced is unable to respond to relevant areas of inquiry, the responding party has a duty to designate an additional knowledgeable deponent. Marker, 125 F.R.D. at 126; Dravo Corp. v. Liberty Mut. Ins. Co., 164 F.R.D. 70, 75 (D. Neb.1995); Starlight, 186 F.R.D. at 638; Sony v. Soundview Technologies, 217 F.R.D. 104, 112 (D. Conn.2002).

What happened next?  In short, the deponent was properly responsive to nearly all of the questions posed, except one category.

A corporation and its counsel cannot be expected to anticipate every question or line of inquiry opposing counsel might ask in a Rule 30(b)(6) deposition. However, the line of questions asked by counsel for Elan concerning the specifics of the costs and revenues for Pixcir products involved in this case are questions a thoroughly educated Rule 30(b)(6) deponent should have been prepared to answer.

The solution?  The corporation’s evidence concerning that one category was excluded from trial.

This unpublished order is in addition to the regularly cited EEOC v. Caesars Entm’t, Inc., 237 F.R.D. 428 (D. Nev. 2006) opinion MJ Leen also authored concerning 30(b)(6) designees. There the parties disputed, among other things, whether a corporate defendant could be required to provide a 30(b)(6) designee to testify concerning the factual bases supporting its affirmative defenses. The corporate defendant argued questioning as to the affirmative defenses, upon which the corporate defendant admittedly bore the burden of proof, would intrude upon matters protected by the attorney-client and/or attorney work-product doctrines. It sought to preclude questioning on this topic. Although a split of authority existed, MJ Leen concluded the questioning was permissible.

Oral deposition questions of non-lawyer witnesses may pose a slightly greater risk of inadvertent disclosure of privileged or protected information, but that risk is adequately addressed by the presence of counsel who may instruct the witness not to answer improperly phrased questions which would reveal attorney-client privileged information. Since Rule 30(b)(6) imposes an affirmative duty on a party to designate a witness with knowledge of the areas of examination identified by the opposing party, that witness can be counseled on the scope of the attorney-client privilege and attorney work product doctrine in deposition preparation. Accordingly, the court finds that areas of examination nos. 10 and 11 do not inherently call for information protected by either the attorney-client privilege or the work product doctrine. Both areas of inquiry seek the discovery of facts and the source of information about the defendants’ claims and defenses which are clearly relevant and discoverable within the meaning of Rule 26(b). Therefore as with written interrogatories under Rule 33, defense counsel may not object to this line of questioning on the basis that it calls for the application of fact to law. The EEOC has repeatedly assured the court and opposing counsel that it will not seek to ask questions of the Rule 30(b)(6) deponent(s) which probe the mental impressions or thought processes of counsel or to inquire into clearly privileged communications between the corporate defendant and its counsel, and the court fully expects the EEOC will honor its commitment in this regard.

Id. at 434-35. Furthermore, the corporate defendant did not meet its burden to demonstrate producing such a witness was unduly burdensome.

The affirmative defenses are obviously legal in nature, but the facts which support them are not. Moreover, due to the affirmative duty imposed by Rule 30(b)(6) for the corporation to designate a witness to testify on matters known or reasonably available to the corporation, the defendant and its counsel control who will testify on its behalf and have the ability, indeed, the duty to properly educate the witness or witnesses who testify on its behalf.

Id. at 435.