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Nucap Industries Inc. v. Robert Bosch LLC

United States District Court, N.D. Illinois, Eastern Division

December 7, 2017



          Young B. Kim, United States Magistrate Judge

         Before the court is Defendants' motion for a protective order barring the deposition of Volkmar Denner, Chairman of the Board of Management of Defendant Robert Bosch GmbH (“Bosch GmbH”). For the following reasons, the motion is granted without prejudice to Plaintiffs seeking leave to re-notice Denner's deposition if and when they can demonstrate a need for it:


         The facts in this case are set forth in previous orders resolving the parties' motions for summary judgment and motions to dismiss, so the court need not repeat them at length here. See Nucap Indus., Inc. v. Robert Bosch LLC, No. 15 CV 2207, 2017 WL 1197104, at *2-6 (N.D. Ill. Mar. 31, 2017); see also Nucap Indus., Inc. v. Robert Bosch LLC, No. 15 CV 2207, 2017 WL 3581174, at *1-5 (N.D. Ill. Aug. 18, 2017). Briefly, Plaintiffs sold brake components to Defendants from 2008 until their business relationship soured and came to an end in November 2014. See Nucap Indus., 2017 WL 1197104, at *2-3. The parties have differing views on what led Bosch GmbH, a German limited liability company and indirect parent of Robert Bosch, LLC (“Bosch”) and Bosch Brake Components, LLC (“Bosch Brake”), to terminate their relationship. (See R. 961, Pls.' Opp. at 2.) According to Plaintiffs, Defendants' decision to end the parties' business dealings in 2014 “is central to the claims, counterclaims, and defenses in this case[, ]” and Plaintiffs argue that Denner is likely to have knowledge on this topic. (Id. at 4.) Defendants contend that Denner has no relevant and unique personal knowledge relating to Plaintiffs' claims and that any such information can be obtained through less burdensome means. (R. 914, Defs.' Mot. at 1-2; R. 978, Defs.' Reply at 2.)


         Federal Rule of Civil Procedure 26(b)(1) allows parties to “obtain discovery regarding any non-privileged matter that is relevant to any party's claim or defense, ” and public policy favors disclosure of relevant materials. See Patterson v. Avery Dennison Corp., 281 F.3d 676, 681 (7th Cir. 2002). Rule 26(c)(1) also allows district courts to issue a protective order limiting discovery to protect a party from oppression, undue burden, or expense for good cause. Before doing so, the court must consider the totality of the circumstances and weigh the value of the material sought against the burden of providing it. Patterson, 281 F.3d at 681 (citations omitted).

         When it comes to determining who bears the burden of showing good cause in the case of deposing high-level executives, federal courts have adopted varying approaches. See Iain D. Johnston, Apex Witnesses Claim They Are Too Big to Depose, Litigation, American Bar Association, Vol. 41, No. 1 (Fall 2014), available at nessdepose.pdf (“Apex Witnesses”) (collecting cases). Bosch GmbH asserts that Plaintiffs bear the burden of showing both that Denner is likely to possess relevant, unique personal knowledge and that less intrusive avenues of discovery have been exhausted. (R. 914, Defs.' Mot. at 3-5.) Meanwhile Plaintiffs argue that Bosch GmbH has the burden of demonstrating that “extraordinary circumstances” justify granting a protective order. (R. 961, Pls.' Opp. at 2 (internal quotation marks omitted).) Both parties seek to apply the “apex doctrine, ” a framework used by some courts to analyze whether to allow the depositions of high-ranking senior executives or officials. See, e.g., Finisar Corp v. Nistica, Inc., No. 13-3345, 2015 WL 3988132, at *1 (N.D. Cal. June 30, 2015); Powertech Tech., Inc. v. Tessera, Inc., No. 11-6121, 2013 WL 3884254, at *1 (N.D. Cal. July 26, 2013).

         Although the Seventh Circuit has not formally adopted the apex doctrine, both parties cite to Patterson in support of their position. In Patterson, the Seventh Circuit noted that deposing “a high-ranking executive in a multinational corporation . . . would have been a quite costly and burdensome means” for determining whether he had information bearing on the claims in the case. 281 F.3d at 681. The Patterson court also observed in that case that the plaintiff seeking to depose the executive failed to take advantage of an “inexpensive, convenient method of discovery, i.e., interrogatories, ” which casted “serious doubt” over her claim that the executive had information “that was more than marginally relevant to her civil action.” Id. at 682 (citations omitted). After considering these factors and the relatively small amount in controversy, the Patterson court affirmed the district court's decision not to permit the deposition. Id.

         According to Bosch GmbH, Patterson mandates that Denner, an “apex employee, ” must be protected from having to sit for a deposition unless Plaintiffs can first prove he has unique, non-cumulative, first-hand relevant knowledge that cannot be obtained by other less intrusive means. (See R. 914, Defs.' Mot. at 3-4.) But this view misreads Patterson and contradicts the well-established principle that the party seeking protection from discovery bears the burden of presenting “a particular and specific demonstration of fact” as to the need for that protection. See Gulf Oil Co. v. Bernard, 452 U.S. 89, 102 n.16 (1981) (citations omitted); see also Hodgdon v. Northwestern Univ., 245 F.R.D. 337, 341 (N.D. Ill. 2007) (“[Rule 26] puts the burden on the party seeking the protective order to show some plainly adequate reason for its issuance.”); Johnson v. Jung, 242 F.R.D. 481, 483 (N.D. Ill. 2007) (“The burden to show good cause is on the party seeking the protective order.” (citation omitted)). Rather than shifting the burden to the party seeking discovery, Patterson merely acknowledged that when weighing the value of the material sought against the burden of providing it, courts may consider an employee's “apex” position and whether less burdensome alternatives are available. See Patterson, 281 F.3d at 681-82. As such, rather than establishing hard and fast requirements, Patterson confirmed the idea that a court should be sensitive to the risk of abuse where an executive has no real information, and as with any other protective order, “should look for guidance to a balance of the likelihood of oppression or harassment compared to the value of the inquiry in generating important information.” See Dyson, Inc. v. Sharkninja Operating LLC, No. 14 CV 779, 2016 WL 1613489, at *1 (N.D. Ill. April 22, 2016) (citation omitted).

         Bearing this in mind, the court considers the specific reasons Bosch GmbH provides for why there is good cause for a protective order. First, according to Bosch GmbH, Denner had no involvement in the actions giving rise to Plaintiffs' claims. (R. 914, Defs.' Mot. at 1.) Bosch GmbH further contends that less burdensome avenues, such as issuing written discovery and deposing other witnesses, are available to Plaintiffs for obtaining the information they seek from Denner. (Id. at 9-13.) Finally, Bosch GmbH argues that sitting for a deposition would be unduly burdensome and would significantly disrupt Denner's company obligations. (Id. at 13.) The court addresses each of these reasons in turn.

         A. Denner's Lack of Involvement

         The court finds Bosch GmbH's evidence that Denner was not involved in the events at issue persuasive. First, Bosch GmbH asserts, and Plaintiffs do not dispute, that Denner “is not identified as an author, sender or recipient of even a single pre-litigation document . . . of the nearly 3 million pages of documents exchanged thus far[.]” (R. 914, Defs.' Mot. at 1.) Plaintiffs also do not dispute that no other witnesses have suggested that Denner was involved with, or has knowledge regarding, the central issues in the case. To support its argument, Bosch GmbH attaches deposition transcript excerpts from key employees of Defendants Bosch and Bosch Brake who testified to their lack of contact with Denner. (Id., Exs. E & F.) Bosch GmbH also includes affidavits from Lutz Marschall, President of Bosch Brake, and Eckhard Lichtenthaler, Senior Vice President of the Automotive Aftermarket Brake Components (“AA-BC”) business unit of Bosch GmbH, attesting to the fact that Denner was not involved in decisions regarding Defendants' business relationship with Plaintiffs, and that they had no conversations with Denner prior to the lawsuit about that relationship or Defendants' efforts to purchase brake components from another group of companies. (See id., Exs. I & J.) Rather than making “stereotyped and conclusory statements” regarding Denner's limited involvement, Bosch GmbH has provided specific support for its assertion that Denner does not have relevant information.

         Plaintiffs attempt to counter Bosch GmbH's showing by citing to an email from Marschall regarding the parties' deteriorating relationship, a letter from Lichtenthaler with Denner's name in the footer, Denner's online bio, a press release issued after this suit was filed, and Defendants' counterclaims alleging that Plaintiffs ceased product shipments “without justification” and “in order to cause Bosch financial and reputational distress.” (R. 961, Pls.' Opp. at 5-6.) However, the court is unconvinced that this evidence shows Denner has more than a remote relationship to the claims in this case. As an initial matter, it is unclear why Defendants' reasoning for ending their business relationship with Plaintiffs is “central to the claims, counterclaims, and defenses in this case” as Plaintiffs allege. (See R. 961, Pls.' Opp. at 4.) The court recently held that at this stage in the proceedings, information regarding the safety of certain brake components and their alleged role in the dissolution of contractual relations between the parties is irrelevant. (See R. 951.) But even if the court ultimately determines that such information is in fact relevant as Plaintiffs urge in their objection to the court's order, (R. 956), the evidence Plaintiffs rely on does little to show that Denner has that information. Plaintiffs cite an email from Marschall to Ray Arbesman, Chairman and Owner of Nucap Industries, stating that the parties' endangered relationship was a topic that “ha[d] reached board level in Germany.” (R. 961, Pls.' Opp. at 5.) However, this vague language does not implicate Denner's direct involvement in the matter, nor does it identify which board Marschall is referring to and what is meant by “reached.” (See R. 978, Defs.' Reply at 8.)

         As for Denner's name appearing in the company stationery's footer and “Corporate Strategy” being listed as one of his responsibilities on Defendants' web site, Plaintiffs are grasping at straws. This is unlike other cases where the executive is portrayed in marketing materials as being “uniquely ‘hands-on, '” see In re Pradaxa (Dabigatran Etexilate) Prods. Liab. Litig., MDL No. 2385, 2014 WL 257566, at *2 (S.D. Ill. Jan. 23, 2014), or where evidence shows the executive had a substantial role in the specific decisions at issue, see id.; Jung, 242 F.R.D. at 485. Here, the mere appearance of Denner's name in a letterhead (alongside several other names, presumably board members) and the generic description of his role as board chairman of a large corporation are insufficient to justify taking his deposition. See Bombardier Recreational Prods., Inc. v. Arctic Cat, Inc., No. 12-CV-2706 ...

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