1ST Class Legal (I.S.), Ltd. v. Niro, et al.

Northern District of Illinois, ilnd-1:2016-cv-06793

MOTION by Defendant Niro Law, Ltd. for protective order Defendant Niro Law, Ltd. Motion for Protective Order

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IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION 1st CLASS LEGAL (I.S.), LTD., a foreign) Corporation,)) Plaintiff,)) No. 16 C 6793 v.)) Judge Dow RAYMOND NIRO, et al.,)) Magistrate Judge Finnegan Defendants.) MOTION FOR PROTECTIVE ORDER This is not the type of motion we like to file. This motion is filed to stop a deposition of plaintiff’s own managing officer/owner that plaintiff’s counsel unilaterally set to run for a week or more, in remote western England, during a week at the end of this month, on dates picked by plaintiff without consulting with defense counsel. Plaintiff’s counsel had prior depositions (in other cases) scheduled for the dates picked by 1st Class Legal (I.S.), Ltd. Defendant, Niro Law, Ltd. requests that the deposition not proceed as scheduled; that plaintiff be made to justify conducting the deposition in a foreign locale; and that if it is to proceed in that foreign locale, that fair and equitable terms be set regarding expenses and the conduct of the deposition. CASE BACKGROUND This case was filed in June 2016 as a breach of contract/accounting action by 1st Class Legal (I.S.), Ltd., a United Kingdom corporation, against Niro Law, Ltd., an Illinois corporation. While the initial pleading also sought to name an individual (Raymond P. Niro, Sr., who died in August 2016 before being served or appearing in the suit) and a non-existent "partnership" named as "Niro, Haller & Niro," the only defendant actually in the suit to date is Niro Law, Ltd., which filed a 1 counterclaim against 1st Class in September 2016. (Dkt. 13.) Bob Gordon, the deponent at issue, is the managing director of 1st Class Legal (I.S.), Ltd. Since then, written discovery has proceeded and 1st Class has moved for summary judgment on the counterclaim. (Dkt. 34, 43, 49.) Then, on April 13, 2017, 1st Class filed a motion to amend (Dkt. 53), seeking to broaden its claims to include tort theories, and to add eight new individual defendants (former shareholders in Niro Law, Ltd.), as well as the representatives of the late Mr. Niro’s estate, the trustee of a trust established by Mr. Niro, and another law firm alleged to be the "successor" to Niro Law, Ltd. 1 Niro Law, Ltd. has opposed the motion to amend, which became fully briefed at the end of July. (Dkt. 59, 60.) In the interim, Niro Law, Ltd. dissolved in the wake of Mr. Niro’s passing; 1st Class went into "liquidation" (the U.K. equivalent of bankruptcy); and the parties engaged in a mediation in June that did not result in resolution of the case. Around the time of the mediation and during post-mediation efforts to continue settlement discussions, 1st Class indicated that it would plan to take the deposition of its own managing agent and owner, Bob Gordon, in the U.K. in light of what was asserted to be his declining health. 1st Class has not provided any competent evidence that Mr. Gordon is in declining health, and in fact Mr. Gordon traveled to the United States last October to attend a meeting related to this case. THE NOTICE OF DEPOSITION On the afternoon of September 1, 2017 (the Friday before Labor Day), 1st Class served on counsel for Niro Law, Ltd. a "Notice of Deposition" (Ex. 1) purporting to set Mr. Gordon’s deposition in Shrewsbury, County Shropshire, England (near the Welsh border, about a three-hour drive from Heathrow), commencing on September 25, 2017, occurring for not more than three hours 1 In its reply in support of the motion to amend (Dkt. 60), 1st Class indicated that it would abandon its purported claims against that law firm, Vitale, Vickrey, Niro & Gasey LLP. 2 each day, and continuing day to day (weekends and holidays excluded), including a direct examination (by 1st Class of its own managing agent) not to exceed seven hours. 1st Class expressed its "willing[ness]" to permit up to seven hours of cross-examination for "Defendants (collectively)." 2 There were no prior discussions among counsel regarding potential dates for any such deposition. Along with the Notice of Deposition, 1st Class forwarded an unsworn letter from U.K. attorney Rachel Higgs (Ex. 2), who we understand to represent 1st Class’ administrator/liquidator in the U.K. bankruptcy. Ms. Higgs’ letter related that Mr. Gordon had "told" her that he suffers from cirrhosis of the liver; that under the U.K. welfare system his illness is considered terminal (with death to be reasonably expected within six months). It attached a form (Ex. 3) apparently completed in July 2017 by Mr. Gordon’s hepatologist for the purpose of obtaining welfare benefits, indicating that a diagnosis was made in January 2016—20 months ago—of "Decompensated cirrhosis," a "progressive condition." Interestingly, Mr. Gordon traveled to the U.S. in October 2016, well after the alleged diagnosis, to meet with shareholders of Niro Law, Ltd. The form contains no information about Mr. Gordon’s prognosis, his life expectancy, his ability to travel or participate in other activities, or any other present or anticipated limitations on his ability to testify. This raised significant concerns for Niro Law, Ltd. and its counsel, for several reasons: (1) the lack of supporting evidence regarding Mr. Gordon’s health; (2) the cost and inconvenience of taking Mr. Gordon’s deposition over the course of several days (likely at least a full week based on the terms set forth in the Notice) in a distant location in western England; (3) the fact that the 2 There is at present a sole defendant, Niro Law, Ltd. The "notice" provides that 1st Class is willing to allow the appearance and participation "of those parties who have not yet appeared in this action and who are identified in the amended complaint which is the subject of the pending Motion to Amend...." There are no such "parties," since leave to amend has not been granted, and the "notice" itself is directed solely to counsel for the sole defendant, Niro Law, Ltd. 3 undersigned (the sole retained attorney for Niro Law, Ltd.) has depositions previously scheduled to occur that week in the United States on cases for which he has significant discovery responsibilities, including two cases with not-to-be-extended discovery deadlines pending in this Court; and (4) other issues of concern regarding the conduct of the deposition. Accordingly, the following business day, the undersigned wrote to counsel for 1st Class (Ex. 4), raising the following issues: • The lack of competent medical evidence concerning the need to conduct the deposition in England; • Undersigned counsel’s prior commitments during the week of September 25, including previously set depositions, including in a case for which discovery closes on September 29, with no further extensions to be granted; • The need for substantial time to prepare for this deposition of the person who is undoubtedly the key witness for plaintiff’s case; • The need to receive documents responsive to a set of document requests served by Niro Law, Ltd., upon plaintiff on August 30, 2017; • A request that because of the extraordinary expense entailed in traveling to England for a week or more, that plaintiff cover at least (a) the cost of attorney travel time; (b) transportation costs; (c) the cost of lodging and a modest per diem. These costs were estimated to cost about $25,000. 3 The email noted that although 1st Class is in liquidation, it has assets of millions of British Pounds, whereas Niro Law, Ltd. is no longer in business and has essentially no assets 4; • A representation that Niro Law, Ltd. would need at least seven hours to depose Mr. Gordon upon the conclusion of 1st Class’ own examination (apparently up to seven hours); • A request for an order of this Court, agreed or otherwise, that once Mr. Gordon’s testimony commences, there be no discussions with him about his testimony (past or anticipated) by counsel or other agents of 1st Class until his testimony is complete; 3 We made this estimate based on approximately 30 hours of travel time round trip ($12,750); business class air and ground transportation to Shrewsbury (approximately $5,000); and a stay of seven nights at the hotel where plaintiff proposes to conduct the deposition (bed and breakfast rate at about $800 per night for a room with a double bed); and a modest per diem for food and incidentals. 4 Ex. 5 is documentation for the U.K. bankruptcy showing of 1st Class as having £ 2 million "Cash at Bank." See https://beta.companieshouse.gov.uk/company/05452812/filing-history (which also shows, at "Statement of Administrator’s Proposal, May 4, 2017, Appx. 2 p. 31, that Mr. Gordon and his wife own substantially all of the company). Exhibit 6 is a declaration from Dean Niro regarding the finances of Niro Law, Ltd. 4 • A request that the "Notice" be amended to make clear how the deposition would be recorded in accordance with Rule 30(b)(3)(A); • An agreement that, in light of the scheduled times for the testimony (in the middle of the night Chicago time) and the impracticability of receiving contemporaneous guidance from this Court in the event of a dispute, that 1st Class’ counsel agree to "faithfully observe[]" Rule 30(c)(2), and not to advise the deponent not to answer any question except to preserve a privilege, "which must not include such an instruction based upon a claim that the information sought is not obtainable under the law of any jurisdiction other than the United States;" and • That if the deposition proceeds in England, that 1st Class’ counsel cooperate in arranging the deposition of Eibhlin Gordon (Mr. Gordon’s wife, and an officer or employee of the company at the time of the events in question) and one or more 30(b)(6) witnesses to be conducted during the same trip. The response of 1st Class’ counsel is attached as Exhibit 7. We will not characterize it, except to confirm that it did not agree to a single one of the conditions in Exhibit 4, but instead essentially asked for "legal authority" for each and every request. Niro Law, Ltd., followed by asking on September 6 if "at least" 1st Class would agree that the deposition would not proceed on September 25 in light of pre-existing commitments; 1st Class’ counsel responded that he would "find out" if the deposition could be scheduled at another time, but made no assurances. (Ex. 8.) CERTIFICATION Undersigned counsel certifies, pursuant to Rule 26(c)(1), that he has in good faith attempted to confer with plaintiff’s counsel to resolve these issues, and that particularly in light of the shortness of time until the date provided in the Notice, it does not appear possible to do so without the Court’s involvement. DISCUSSION Rule 26(c)(1), Fed. R. Civ. P., authorizes the Court to issue orders to protect a party from "undue burden or expense," including a wide range of remedies such as forbidding certain 5 discovery, prescribing the methods of discovery, and "specifying terms, including time and place or the allocation of expense, for the... discovery." "The decision of where a deposition should occur is ultimately an exercise in the vast discretion a district court has in supervising discovery." New Medium Technologies LLC v. Barco N.V., 242 F.R.D. 460, 462 (N.D. Ill. 2007). The "general rule," however, is that "plaintiff must produce its witnesses in the district in which plaintiff instituted the action, unless the plaintiff has shown financial hardship or inability to attend the deposition in that district." Aerocrine AB v. Apieron Inc., 267 F.R.D. 105, 108 (D. Del. 2010). While corporate representatives’ depositions are frequently taken at the corporation’s place of business, "When a foreign corporation is doing business in the United States, is subject to the court’s jurisdiction, and has freely taken advantage of our federal rules of discovery, exceptions to th[at] general rule... are often made." Custom Form Mfg. Inc. v. Omron Corp., 196 F.R.D. 333, 336 (N.D. Ind. 2000). "Courts have dealt with disputes regarding depositions of foreign witnesses by ordering a party to bear all or a portion of expenses incurred because the deposition is held in the locale chosen by that party." Wade v. Westinghouse Lighting Corp., 11-C-483, 2013 WL 12136608, *5 (E.D. Tex. June 4, 2013), citing Custom Form, 196 F.R.D. at 338. A plaintiff’s request to deviate from the customary location of a deposition based on factors like age or other burdens may be denied where not supported by an affidavit providing specific reasons why appearing in the district where the action is pending would present an undue hardship. Cobell v. Norton, 213 F.R.D. 43, 47 (D. D.C. 2003). No such affidavit had been provided by 1st Class. Defendant respectfully submits that Mr. Gordon’s deposition should be permitted to proceed in England only upon a showing by competent medical evidence (not a letter from an attorney reporting what Mr. Gordon has told her, nor a doctor’s form providing virtually nothing but a nearly two-year-old diagnosis) that Mr. Gordon’s health is such as to make travel to the United States an undue burden; and that if it is permitted to proceed in England, that 1st Class be required 6 to pay (before travel is booked and conducted, particularly in light of 1st Class’ ongoing bankruptcy) the reasonable time and out-of-pocket expenses for a single attorney for defendant to attend in person, approximately $25,000. Defendant likewise asks the Court to rule in accordance with the other requests raised by the undersigned in Ex. 3: (1) that the deposition be scheduled in a manner such as to accommodate counsel’s pre-existing commitments and need to prepare (not a unilaterally chosen week for travel to, and a week-long stay in, a foreign locale); (2) that defendant receive documents responsive to its outstanding document requests at least 14 days before the deposition commences; (3) that defendant Niro Law, Ltd. be granted seven hours to take Mr. Gordon’s deposition upon the completion of questioning by plaintiff’s (and Mr. Gordon’s) own attorney; (4) that an order be entered forbidding counsel or agents for 1st Class from discussing Mr. Gordon’s testimony with him off the record once that testimony commences (just as is routinely ordered at trial; the Notice of Deposition provides that the deposition is "in lieu of live testimony at trial"); (5) that plaintiff specify in its Notice, in accordance with Rule 30(b)(3)(A), how the deposition will be recorded (stenographic, video, etc.); (6) that plaintiff’s counsel not instruct the witness not to answer any questions posed except in accordance with Rule 30(c)(2) to protect a privilege (or other terms that the Court may see fit to impose ahead of time), and that such an instruction will not be given on the basis that the information sought is not obtainable under the law of any non-U.S. jurisdiction; and (7) that plaintiff cooperate in arranging the depositions of Eibhlin Gordon and witness(es) pursuant to Rule 30(b)(6) to be taken during the same trip (which could probably be accomplished in the afternoons, since Mr. Gordon’s testimony is set to terminate by 12:30 p.m. each day). 5 5 In the alternative to arranging Mrs. Gordon’s deposition and a 30(b)(6) deposition during the trip to England, defendant would request an Order that such witnesses will be required to submit to their depositions in Chicago at times to be arranged. 7 CONCLUSION For the foregoing reasons, defendant Niro Law, Ltd., requests entry of an order in accordance with the provisions outlined above, or for such other or further relief as the Court deems equitable and appropriate. Respectfully submitted,/s/Matthew D. Tanner Matthew D. Tanner (ARDC 6202508) ROESER BUCHEIT & GRAHAM LLC Two N. Riverside Plaza, Suite 1850 Chicago, Illinois 60606 (312) 300-2522 8 CERTIFICATE OF SERVICE Matthew D. Tanner hereby certifies that he caused this opposition to be served upon all counsel of record via the court’s electronic docketing system on September 8, 2017./s/Matthew D. Tanner 9