How to avoid, control or limit depositions of top executives.

• Author: Preuss, Charles F.

A TOP executive receives a properly noticed deposition in an important case for the company. The executive is committed to many meetings on the day the deposition is scheduled and is displeased with the prospect of having a tight schedule disrupted. As outside defense counsel, you are informed that the smooth running of the company requires the executive's uninterrupted attention. You are told to find a solution that avoids the deposition without prejudicing the defense of the case. What do you do?

SCOPE OF PERSONAL KNOWLEDGE

The first step is to ascertain what the executive knows about the subject matter of the lawsuit. Does the executive have personal knowledge of the events surrounding the lawsuit? Did the executive participate in the negotiations, discuss the facts, issue any directives, or otherwise take part in events that led to the suit? Did the executive write or receive any letters, memos, reports or e-mail related to the litigation? Has the executive written, spoken or given a deposition in the past on the subject matter of the case? If there is personal knowledge, what does the executive recall? Anything?

If there is personal knowledge or involvement, you may have difficulty avoiding the deposition.(1)

PROCEED OR RESIST?

The preferred course of action in most instances is to resist the deposition. Companies' executives are responsible for running businesses, and they can't do that effectively if they are giving depositions in every lawsuit. It is often difficult, moreover, to schedule sufficient time to prepare the executive adequately, and high-level corporate testimony cannot be undone easily if the answers do not square with the facts as they as they become better understood through subsequent discovery.

Before dismissing the option of proceeding with the deposition, however, consider the potential benefits of making the executive available. Personal knowledge or witness skills may enable the executive to deliver the case themes persuasively at an early stage of the litigation when the opposing counsel is not fully prepared to ask the tough questions. If the company's message is effectively communicated, the other side may be discouraged and pursue the suit with less vigor. There also may be situations in which you need to depose your adversary's executives, an option that could be more difficult if you resist.

Of course, the decision will depend on the facts and circumstances of each case. The company's top executives are the personification of the company, and their personal involvement could be critical to the case's outcome.

RULES FRAMEWORK

Assuming a decision to resist, Rule 26 of the Federal Rules of Civil Procedure is the vehicle through which to seek relief.

Rule 26(b)(1) permits discovery regarding information that is "relevant to the subject matter involved in the pending action," and the information sought need not be admissible at trial if it "appears reasonably calculated to lead to the discovery of admissible evidence." If an executive's deposition does not meet this standard, the notice can be quashed.(2)

As amended in 1983, Rule 26(b)(2) provides that discovery "shall" be limited if the court determines that:

(i) the discovery sought is unreasonably cumulative

or duplicative, or is obtainable from some

other source that is more convenient, less burdensome,

or less expensive; (ii) the party seeking discovery

has had ample opportunity by discovery in

the action to obtain the information sought; or (iii)

the burden or expense of the proposed discovery

outweighs its likely benefit, taking into account

the needs of the case, the amount in controversy,

the parties' resources, the importance of the issues

at stake in the litigation, and the importance of the

proposed discovery in resolving the issues.

The rule was amended again in 1993 to emphasize the court's obligation to control the course of discovery. In particular, the Advisory Committee Notes to subdivision (b)state: "The revisions in Rule 26(b)(2) are intended to provide the court with broader discretion to impose additional restrictions on the scope and extent of discovery ...."

Using Rule 26 with the information obtained regarding the personal knowledge of the executive, defense counsel can plan their strategy for quashing, delaying or narrowing the scope of the deposition.

GROUNDS TO LIMIT

There are several grounds courts favor for granting relief from attempts to depose company executives. The goal of a motion is to demonstrate that there is no good cause to proceed with the deposition. Four factors should be emphasized:

* lack of personal knowledge;

* availability of less intrusive or alternative discovery;

* duplicative nature of the discovery; or

* improper motive in pursuing discovery.

1. Lack of Personal Knowledge

   Often the strongest basis for quashing a deposition is the executive's lack of personal knowledge regarding the litigation.(3) This should be established by affidavit. Because a key executive generally is concerned with major, long-range decisions, the executive may have only a passing acquaintance with the issues in the lawsuit, often based on second- or third-hand information.

   While lack of personal knowledge may be the strongest ground for argument, it is important, before making this argument, to conduct a reasonable inquiry as to the executive's knowledge.(4) For example, if the executive was not involved in day-to-day activities surrounding the lawsuit but did participate in a decision relevant to the litigation, the executive's deposition may be allowed, and if the motives behind a corporate action are at issue and the opposing party seeks to depose executives who approved that action, then a court may allow the deposition.(5)

   Avoiding an executive's deposition becomes more difficult when the executive had personal knowledge at one time but lacks present recollection of the relevant facts. Again, it will be necessary...