The unwarranted weight of a 'paper barrier': a proposal to ax the apex doctrine.

• Author: Lam, Amalia L.

[I]f Mr. Iacocca has any information, albeit inadmissible as evidence reasonably calculated to lead to the discovery of admissible evidence, he must be required to reveal the same. His prestigious position is an unimpressive paper barrier shielding him from the judicial process.... [But] [t]he fact remains he is a singularly unique and important individual who can be easily subjected to unwarranted harassment and abuse. He has a right to be protected, and the courts have a duty to recognize his vulnerability. (1)

Lee Iacocca is one of the most recognizable CEOs in the world, linked with both Chrysler's successful revival and the Ford Pinto's unenviable infamy. In Mulvey v. Chrysler Corp., (2) the plaintiffs alleged that a car accident in which they were injured was caused by a design defect in a 1975 Dodge van. (3) The Mulvey plaintiffs claimed that Mr. Iacocca, who at the time of the suit served as Chairman of the Chrysler Board, "in his published biography ... made certain damaging statements relevant to [Chrysler Corporation's] liability, and the plaintiffs should now be given the right to explore [Mr. Iacocca's] knowledge which underl[ied] said statements." (4) The court, remarking that "discovery ha[d] become an abusive tool in the hands of certain attorneys," (5) barred the plaintiffs from taking Mr. Iacocca's oral deposition. (6)

The Mulvey court's concern-that Mr. Iaccocca's "prestigious position" rendered him vulnerable "to unwarranted harassment and abuse" by enterprising plaintiffs (7)--was shared by other courts keen to protect high-ranking corporate officers from discovery abuse. (8) Today, some federal courts limit the depositions of high-ranking corporate officers by applying the apex doctrine, (9) although they "stop well short of establishing a rigid rule applicable in all cases." (10) The apex doctrine is a heightened protection framework courts use to "protect[] high-level corporate officials from deposition unless (1) the executive has unique or special knowledge of the facts at issue and (2) other less burdensome avenues for obtaining the information sought have been exhausted." (11) As a result, courts applying the doctrine may bar the depositions of high-ranking corporate officers when the party seeking the deposition has not yet deposed lower-level employees or has failed to provide sufficient evidence that the apex officer possesses "unique" knowledge. (12)

This Note examines the variety of ways federal courts have approached apex deponents and the apex doctrine. Part I dissects the relevant Federal Rules of Civil Procedure and summarizes the considerations embedded in apex depositions decisions. Part II reviews cases in which courts have applied the apex doctrine. Part III examines cases in which courts declined to apply the apex doctrine. Part IV analyzes the range of decisions and argues that as applied to corporate officers, the apex doctrine creates the appearance of preferential treatment and unnecessarily complicates the protective order analysis. Finally, Parts V and VI propose that federal courts abandon the application of the apex doctrine to corporate deponents.

1. THE FEDERAL RULES OF CIVIL PROCEDURE AND THE FRAMEWORK OF THE APEX DOCTRINE

   1. The Applicable Rules

      The Federal Rules of Civil Procedure govern civil discovery, including depositions. (13) "The Federal Rules set very liberal limits on the scope of discovery," (14) and "[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense." (15) Further, "[r]elevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence." (16) Under Rule 30, "[a] party may ... depose any person, including a party, without leave of court." (17) Although no Rule explicitly addresses apex depositions, the Commentary to Rule 30 (18) offers some guidance:

      High-ranking corporate executives and government officials are not excused from being deposed simply because of their positions. However, courts are cautious to protect these individuals from harassment and to avoid disruption to the organization. In deciding whether the deposition of a high-ranking executive is appropriate (so called "apex" depositions), courts will consider: (1) the likelihood that the executive possesses relevant and unique information; (2) whether the deposing party has attempted to depose lower-level executives first; and (3) whether the deposing party has completed document discovery. If it is shown that the high-ranking executive or official might have discoverable information, the court may allow the deposition to proceed despite the fact that the person denies having such information or claims to be too busy. The court can also place conditions on the deposition in order to protect against burden or harassment. (19) Whatever guidance might be intended, however, the Commentary offers only inconsistent statements and unclear standards. For instance, it contrarily refers both to "unique information" and "discoverable information" as the knowledge standard courts should use to evaluate apex depositions. (20) But the Commentary's inscrutability is beside the point, because in no case discussed in this Note did the court rely heavily or even partially on the Commentary. (21)

   2. Resisting a Deposition

      Parties resist a deposition request by moving for a protective order. Under Rule 26(c)(1), "[a] party or any person from whom discovery is sought may move for a protective order in the court where the action is pending." (22) It is within the court's discretion to, "for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." (23) The "good cause" standard is high, as the Federal Rules of Civil Procedure favor an open and liberal discovery process. (24) In the context of an apex deposition, three forms of protective orders (25) are pertinent: first, the judge may bar the deposition completely; (26) second, the judge may require the deposition to take place in a certain location or at a certain time; (27) third, the judge may limit the scope of the deposition to specific topics. (28) Additionally, "the court may alter ... the length of depositions under Rule 30." (29) Finally, Rule 26(b)(2) mandates the following:

      [T]he court must limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that:

      (i) the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive;

      (ii) the party seeking discovery has had ample opportunity to obtain the information by discovery in the action; or

      (iii) the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the action, and the importance of the discovery in resolving the issues. (30)

      If an apex deponent refuses to appear, the party seeking the deposition may file a Rule 37 motion to compel the deposition. (31) Under Rule 37, "[o]n notice to other parties and all affected persons, a party may move for an order compelling disclosure or discovery." (32) However, apex deponents are usually quick to file protective orders rather than wait for the other party to file a motion to compel. (33)

      Should either a protective order or a motion to compel be granted, "the court must ... require the party or deponent whose conduct necessitated the motion, the party or attorney advising that conduct, or both to pay the movant's reasonable expenses incurred in making the motion, including attorney's fees," (34) unless (1) the motion was filed before a good faith attempt to obtain the deposition, (2) the refusal was "substantially justified," or (3) "other circumstances make an award of expenses unjust." (35) "If the motion [to compel] is denied, the court may issue any protective order authorized under Rule 26(c) and must ... require the movant, the attorney filing the motion, or both to pay the party or deponent who opposed the motion its reasonable expenses incurred in opposing the motion," unless "the motion was substantially justified or other circumstances make an award of expenses unjust." (36)

      Whereas Rule 26(c)(1) imposes on the party seeking to prevent the deposition the burden to show "good cause" why the deposition should not be had, (37) the apex doctrine shifts the evidentiary burden to the party seeking the deposition. (38) Instead of applying the standard of Rule 26(c)(1), courts applying the apex doctrine require the party seeking the deposition to (1) show that the putative deponent possesses "unique or superior" and often "first hand" relevant knowledge and (2) demonstrate it has pursued all other "less burdensome" means of acquiring that knowledge (such as interrogatories and depositions of less prestigious witnesses). (39)

      Generally, courts adopt a combination of three rationales to justify application of the apex doctrine. (40) First, apex officers are very busy. (41) Second, when the company is very large, apex officers are often removed from the day-to-day business of the company and lack personal knowledge relevant to individual employee or tort claims. (42) Finally, the prestige, power, and visibility of executive positions make apex officers easy targets for harassment and discovery abuse. (43) These arguments have persuaded many courts that the deposition of a corporate apex officer is an extremely intrusive, inefficient, and burdensome form of discovery and that apex officers require more protection than non-apex deponents. (44) Some warn that "court[s] should be alert to see that the liberal deposition procedure provided in the Federal Rules is used only for the purpose for which it is intended and is not used as a...