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Requests to depose high-ranking corporate officers are commonly referred to as apex depositions. Courts have generally restricted parties from deposing high-ranking officials because (by virtue of their position) they 'are vulnerable to numerous, repetitive, harassing, and abusive depositions, and therefore need some measure of protection from the courts.
In a separate pending litigation between Sun Capital and Twin City Fire Insurance involving an insurance coverage dispute, Sun moves for a protective order prohibiting Twin City from taking the depositions of Marc Leder and Rodger Krouse. Sun maintains that, under the apex doctrine, Leder and Krouse—who are both co-founders and co-chief executive officers of Sun—should not be deposed, as they do not have unique knowledge of the issues in this case that cannot be obtained through less intrusive means. Moreover, Sun also seeks a protective order prohibiting Twin City from taking the deposition of Deryl Couch. Sun again maintains that, under the apex doctrine, Couch—who is general counsel and a managing director of Sun—should not be deposed, as he does not have unique knowledge of the issues in this case and most questions asked of him would draw objections based on privileges and immunities. Last, Sun argues that this Court has adopted the Shelton test to determine whether the deposition of a party's counsel should be permitted. This test, Sun alleges, requires the party seeking the deposition to show that 1) no other means exist to obtain the information, 2) the information sought is relevant and non-privileged, and3) the information is crucial to the preparation of the case. Sun asserts that Twin City cannot meet this burden because Twin City cannot show that no other means exist to obtain the information sought from Couch, as Twin City has not attempted to collect this information from other sources
Should the protective orders be issued in favor of Sun’s high-ranking corporate officers?
Re: Leder and Krouse — Although Twin City lists several reasons why it wishes to depose Leder and Krouse, and also explains the nature of the information it hopes to obtain, Twin City fails to adequately demonstrate that Leder or Krouse have any unique, non-repetitive firsthand knowledge about the matters at issue in this case. Sun has offered Thomas Clare, who was Sun's defense counsel in the underlying litigation, as a corporate representative to be deposed regarding the facts at issue. Twin City has not shown that Clare, or any other person, cannot adequately testify to the facts at issue. Twin City merely asserts that "Sun's proposed lower level depositions will reveal what Twin City already knows—Sun's executives played an integral and unique role in the settlement process, and their depositions cannot be avoided." Twin City also fails to carry its burden of showing that the information it seeks to obtain through deposing Leder and Krouse cannot be obtained from any other source. In certain cases, even when a high-ranking official of a corporation does have direct knowledge of the facts, it is inappropriate to compel his or her deposition without first deposing lesser-ranking employees who have more direct knowledge of the facts at issue. Twin City has not yet deposed any other lesser-ranking employees in an effort to conduct discovery of the facts at issue. Therefore, Twin City has not made a showing that the information it seeks cannot be obtained through less burdensome means.
Re: Couch— Twin City has failed to demonstrate that taking the deposition of Couch is the only practical means available of obtaining the information it seeks. Twin City claims that "no other employee at Sun can testify about the direct involvement, including direct editing of the settlement terms, by these individuals." However, Twin City has not deposed any other employee to ascertain whether this is true. Sun has offered multiple individuals for deposition, which Twin City has refused. Further, in most of the cases that Twin City cites for support, the requesting party first conducted depositions of other lower-level employees. Thus, the Court is of the opinion that other forms of discovery are available to Twin City at this time. In addition, Twin City has not shown that the information sought will not invade the realm of Couch's work-product or attorney-client privilege. Twin City asserts that "[t]his Court's April 22, 2015 Order recognizes that the evaluation, defensibility, allocation, and settlement of the underlying claims are non-privileged topics that Twin City has full range to explore." Although this may be true, a deposition question may cause Couch to discuss an area of his involvement in preparing for this case or an area of confidential communications.