Discovery That Targets the Boss

Litigators who represent corporate clients know that their opponents will sometimes seek depositions or discovery from high-ranking employees, even when there is no reason to believe that high-ranking individual had any knowledge of or engaged in any conduct related to the lawsuit.

Why would anyone bother seeking this kind of discovery?

Typically, it is a tactic to raise the costs of litigation to leverage settlement.  It might not cost (in terms of money paid out to lawyers or counterparties) any more to collect documents from the CEO of a company as it does any other employee, but the time spent by high-ranking individuals to respond to discovery is time that person is taking away from his or her direct responsibilities.  Not only is a high-ranking corporate officer’s time valuable, but in large companies or organizations that may be involved in numerous lawsuits, the executive might find they have little time for their actual job if they get personally dragged into discovery in every legal dispute their organization has.

Another reason a party may seek discovery from a high-ranking employee of their adversary is because they are fishing for information they might be able to use in the case (or even another case).  Even if the high-ranking employee was not directly involved, if they present poorly in deposition or if their documents contain information that the company does not want to become public (for any number of reasons, including trade secrets, confidential business plans, or personally identifiable/private data), a litigant might find itself paying more to resolve a case to limit unnecessary harm to its reputation or business.

Finally, a litigant may attempt to use discovery against senior management to set up a “damned if you do, damned if you don’t,” scenario.  If the senior executive is well-versed on the matter at hand, the opponent may attempt to use it to show that the complained of conduct was official company policy, and therefore more blameworthy.  If the executive is not aware of the facts or circumstances of the litigation, the opponent will attempt to paint corporate leadership as “asleep at the wheel,” or not in control of their enterprise.  Needless to say, neither is a good look for a corporate defendant.

The Apex Shield

The law has devised a defense to improper attempts to burden senior leadership with unnecessary discovery – the Apex Doctrine.  Under Federal Rules of Civil Procedure 26(c)(1)(A), a party can seek a protective order to prevent discovery that is unduly burdensome, oppressive, harassing, or inconvenient.  Most states have their own apex discovery rules that apply a similar standard in state court.  Some state and federal jurisdictions even presume that depositions of apex witnesses (i.e., very senior leadership) are improper absent a showing that the individual was directly involved in the issue at hand and that the information sought cannot be obtained in a more convenient method (typically discovery from less senior individuals).  In such jurisdictions, you don’t need to move for a protective order to prevent an apex deposition, they are presumed improper unless the party seeking discovery can demonstrate why such discovery is necessary.

When Not to Rely on the Apex Rule

In most cases, relying on the Apex Rule to protect your senior leadership from time-wasting and harassing discovery is the right call.  But it’s important to determine whether refusing to put up an apex witness is actually going to harm your case.

That might happen if your claim or defense rests on knowledge only the apex witnesses personally have.  If you need those senior leaders to tell your side of the story because no one else can, you can’t refuse to make them available for deposition.  If you do, you won’t be able to call those senior leaders at trial and you might not be able to make your case as a result.

While most efforts to depose senior leadership are made tactically and without good cause, there are cases (particularly if the litigation is very significant to your company) where senior leaders of an organization are truly important witnesses.  Particularly in bet-the-company litigation that turns on the decisions your senior leadership made, your lawyers cannot assume that the right strategy is shielding those top executives and hoping that lower-level employees can make your case for you.  You need counsel who can not only identify those few cases where senior leadership’s testimony is important to your case, but also have the skills and experience necessary to work efficiently with your top leadership and prepare them.

Keller/Anderle specializes in bet-the-company litigation.  We have represented major companies and high net worth individuals in their toughest cases.  We stand ready to work with you to create the best strategy to succeed in your case.