David and Goliath concept. (shutterstock)
Apex depositions occur when a party seeks to depose an individual at the top of a corporate hierarchy. Apex depositions often provoke disputes as corporations almost uniformly object to their occurrence. Some argue apex depositions are an abusive discovery tactic used to leverage settlement, while others allege they are a legitimate means to reveal discoverable information. Regardless of your position (which may vary depending upon the facts), apex depositions are engendering increasing interest, both for attorneys and corporate clients.
Many jurisdictions have adopted a unique test called the Apex Doctrine to examine the permissibility of apex depositions. This doctrine balances the interests served by permitting an apex deposition with the interests served by precluding the deposition. This balance has been distilled to consideration of the following factors: (1) whether the executive has unique personal knowledge of the facts at issue in the case; (2) whether the information sought from the executive can be obtained from another witness or through an alternative discovery method; and (3) whether sitting for the deposition is a severe hardship given the executive’s obligation to the company.
Interestingly, no Georgia appellate opinion has recognized the Apex Doctrine. Indeed, a Fulton County Superior Court expressly declined to adopt the “apex doctrine,” despite being requested to do so and being presented with on-point facts in Robinson v. Wellshire Fin. Svcs., LLC, No. 2015-cv-2594088 (June 1, 2015). Georgia courts, instead, examine the permissibility of all depositions, including those of high-level executives, under O.C.G.A. § 9-11-26(c), which allows Georgia courts to “make any order which justice requires to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense[.]“
But the Apex Doctrine factors, while not controlling in Georgia, are certainly relevant to an analysis under O.C.G.A. § 9-11-26(c) and should be referenced as persuasive in a motion for protective order or motion to quash an apex deposition.
For the most part, federal courts—including the Eleventh Circuit—have adopted and apply the Apex Doctrine. The federal courts that have not adopted a specific test for apex witnesses rely on Fed.R.Civ.P. 26 to assess whether a witness should be deposed. See, e.g., Serrano v. Cintas Corp., 699 F.3d 884, 901 (6th Cir. 2012).
Like in Georgia courts, the Apex Doctrine factors will be relevant, albeit not exclusive, considerations for a federal court in determining if an apex deposition should go forward under Fed.R.Civ.P. 26. Below is a survey of these factors, showing how courts have interpreted and applied them in the past.
Unique Person Knowledge
The Apex Doctrine presumes that depositions of apex witnesses are intended to abuse, harass, or force settlements. See Groupion, LLC v. Groupon, Inc., 2012 U.S. Dist. LEXIS 12684, at *6 (N.D. Cal. 2012).
Therefore, an apex deponent should have unique personal knowledge of the claims at issue in the specific case before being subjected to a deposition. Courts have held that an apex deponent’s general knowledge of the corporation’s operation is insufficient to justify a deposition when the corporation offers for deposition a lower-ranking executive with knowledge of the corporate structure and events at issues. See Lin v. Benihana Nat’l Corp., No. 10-cv-1335, 2010 4007282, at *2 (S.D.N.Y. Oct. 5, 2010). Further, a CEO’s public statements, even on issues arguably relevant to the case’s claims, are insufficient to justify his deposition. See Affinity Labs of Tex. v. Apple, Inc., No. 09-cv-4436, 2011 WL 1753982, at *16 (N.D.Cal. May 9, 2011).
Keep in mind, though, that consistency is key. Proclaiming to have no knowledge of the incident at issue will likely preclude an apex witness from later offering relevant testimony. Additionally, problems can arise if other case witnesses do not affirm the apex witness’ alleged lack of knowledge regarding the case.
Alternative Means of Discovery
Apex depositions are typically precluded unless the requesting party has exhausted other less intrusive means to discover the sought-after information. Courts have often ordered requesting parties to serve interrogatories before deposing an apex witness. Colonial Capital Co. v. Gen. Motors, 29 F.R.D. 514, 518 (D. Conn. 1961). Given this, parties are recommended to request that an apex deposition be delayed until the party seeking the deposition has exhausted other means of discovery to discover the requested information.
Showing undue hardship on the company or apex deponent can alone justify precluding an apex deposition. In assessing this hardship, courts typically consider factors such as the likelihood of harassment of the executive, potential for business disruption or the number of individuals that directly report to the executive. See Lin, 2010 WL 4007282, at *2. Supporting facts should be presented by affidavit from the implicated apex deponent in support of a motion for protective order or a motion to quash.
In the end, deposition notices and subpoenas for high-level corporate executives are becoming increasingly prevalent. Sometimes these depositions are necessary, but often they are not. Awareness of the Apex Doctrine and the above factors arm a litigant with the knowledge necessary to oppose frivolous apex deposition requests.