Great Gulf Corporation v. Graham

Background

The order addressed Great Gulf Corporation’s motion for a protective order and William Talford Graham, R. P. Air, Inc., and Randolph M. Pentel’s second motion to enforce a court order and obtain sanctions. The dispute concerned depositions of Great Gulf under Federal Rule of Civil Procedure 30(b)(6), Troy Wilson, and Laila Alizadeh.

In November 2021, the court allowed the depositions to occur remotely in Canada but imposed safeguards. Each witness had to be alone in a private room, leave other electronic devices outside the room, and avoid electronic communication with anyone during the deposition. After the witnesses did not appear in compliance with earlier deposition notices, the court ordered Great Gulf, Wilson, and Alizadeh to sit for in-person depositions in Canada by June 3, 2022. The court warned that a person or entity that failed to appear would be prohibited from offering testimony or affidavit evidence for any purpose in the case.

The Pentel Parties arranged a location, court reporter, videographer, and other services for the June 1 depositions. Great Gulf did not appear for its Rule 30(b)(6) deposition at the noticed time. Wilson appeared remotely from a law office in Elliot Lake, Ontario, rather than at the noticed location in Ontario, Canada, and the Pentel Parties declined to proceed. The opinion states that Alizadeh did appear for her deposition on June 2.

Parties’ Positions

Great Gulf argued that the Pentel Parties had frustrated the depositions by selecting a time and place Wilson could not attend, failing to identify the time zone in the notice, and refusing to accept Wilson’s remote appearance from Elliot Lake. Great Gulf requested a protective order requiring the depositions to occur in Minneapolis at the Pentel Parties’ counsel’s address.

The Pentel Parties argued that Great Gulf and Wilson had violated the May 27 order and sought to bar Great Gulf from calling Wilson or Great Gulf’s Rule 30(b)(6) designee as witnesses or offering related evidence. They also sought expenses, attorney fees, and costs connected with the June 1 depositions and the motions.

Court’s Analysis

The court applied Federal Rule of Civil Procedure 26(c), which allows a protective order for good cause to prevent undue burden or expense, and Rule 37, which allows sanctions when a properly noticed deponent fails to appear. Rule 37 also permits an award of reasonable expenses and attorney fees unless the failure was substantially justified or another circumstance makes an award unjust.

The court found that Great Gulf and Wilson had again failed to appear in compliance with the deposition notices and that the failure was not substantially justified. The court found Wilson not credible for purposes of the motions, citing what it viewed as shifting explanations, limited availability, and the surrounding timeline. It also concluded that Great Gulf could have designated and prepared another knowledgeable person under Rule 30(b)(6), rather than continuing to rely on Wilson despite the risk that he would not appear at the noticed location.

The court rejected Great Gulf’s arguments about the time zone and the proposed June 3 deposition. It concluded that the parties’ prior conduct and correspondence made the alleged timing confusion unreasonable under the circumstances, and that the Pentel Parties’ counsel and vendors were not available on June 3.

Ruling and Disposition

The court DENIED Great Gulf’s Motion for a Protective Order. It GRANTED the Pentel Parties’ Second Motion to Enforce Court Order and for Sanctions. Consistent with the prior order, Great Gulf and Wilson were prohibited from offering any evidence by testimony or affidavit for any purpose in the case.

The court also ordered Great Gulf to bear the expenses incurred by the Pentel Parties in arranging the June 1 depositions and the reasonable attorney fees and costs incurred in bringing the sanctions motion and responding to Great Gulf’s protective-order motion. The Pentel Parties had to submit the requested amounts in a counsel affidavit by August 1, 2022, and Great Gulf could respond by August 15, 2022. The order stated that all prior consistent orders remained in effect and that future violations could result in additional listed sanctions, including possible dismissal or default judgment.

The order was signed by Tony N. Leung, United States Magistrate Judge.