Liveperson, Inc. v. 24/7 Customer, Inc.
Filing
376
ORDER by Judge Kandis A. Westmore regarding the parties' 350 Joint Discovery Letter Brief re deposition of Daniel Murphy. (kawlc1, COURT STAFF) (Filed on 3/14/2018)
1
2
3
4
UNITED STATES DISTRICT COURT
5
NORTHERN DISTRICT OF CALIFORNIA
6
7
LIVEPERSON, INC.,
Plaintiff,
8
9
10
ORDER REGARDING 2/23/18 JOINT
DISCOVERY LETTER
v.
Re: Dkt. No. 350
[24]7.AI, INC.,
Defendant.
11
United States District Court
Northern District of California
Case No. 3:17-cv-01268-JST (KAW)
12
13
On February 23, 2018, the parties submitted a joint discovery letter regarding [24]7’s
14
subpoena to depose former LivePerson Chief Financial Officer Daniel Murphy. (Joint Letter, Dkt.
15
No. 350.)
16
Upon review of the joint letter, the Court finds this matter suitable for resolution without
17
oral argument pursuant to Civil Local Rule 7-1(b), and, for the reasons set forth below, finds that
18
[24]7 has met its burden of showing that the deposition of Mr. Murphy is proportional to the needs
19
of the case.
20
21
22
23
I.
LEGAL STANDARD
Federal Rule of Civil Procedure 30(a)(1) provides that, subject to certain limitations, “[a]
party may, by oral questions, depose any person, including a party, without leave of court....”
The Federal Rules of Civil Procedure also broadly interpret relevancy, such that each party
24
has the right to the discovery of “any nonprivileged matter that is relevant to any party’s claim or
25
defense and proportional to the needs of the case[.]” Fed. R. Civ. P. 26(b)(1). Discovery need not
26
be admissible to be discoverable. Id. The court, however, “must limit the frequency or extent of
27
discovery otherwise allowed” if “(i) the discovery sought is unreasonably cumulative or
28
duplicative, or can be obtained from some other source that is more convenient, less burdensome,
1
or less expensive; (ii) the party seeking discovery has had ample opportunity to obtain the
2
information by discovery in the action; or (iii) the proposed discovery is outside the scope
3
permitted by Rule 26(b)(1).” Fed. R. Civ. P. 26(b)(2)(C).
Furthermore, “[t]he court may, for good cause, issue an order to protect a party or person
4
from annoyance, embarrassment, oppression, or undue burden or expense,” including by
6
precluding discovery, by conditioning disclosure or discovery on specified terms, by preventing
7
inquiry into certain matters, or by limiting the scope of discovery to certain matters. Fed. R. Civ.
8
P. 26(c)(1). “Rule 26(c) confers broad discretion on the trial court to decide when a protective
9
order is appropriate and what degree of protection is required.” Seattle Times Co. v. Rhinehart,
10
467 U.S. 20, 36 (1984). The party seeking the protective order has the burden of showing good
11
United States District Court
Northern District of California
5
cause by “demonstrating harm or prejudice that will result from the discovery.” Rivera v. NIBCO,
12
Inc., 364 F.3d 1057, 1063 (9th Cir. 2004).
II.
13
DISCUSSION
The joint letter concerns [24]7’s deposition subpoena to former LivePerson chief financial
14
15
officer Daniel Murphy, who left the company on February 21, 2018. (See Joint Letter at 1.)
16
In support of its request for protective order,1 LivePerson claims that Mr. Murphy’s
17
deposition is prohibited by the “apex doctrine,” because [24]7 has not shown that he possesses
18
“unique, non-repetitive, first-hand knowledge of facts” warranting such discovery and that
19
undergoing a deposition would constitute an undue burden. (Joint Letter at 2.) “When a party
20
seeks the deposition of a high-level executive (a so-called “apex” deposition), the court may
21
exercise its discretion under the federal rules to limit discovery.” Affinity Labs of Texas v. Apple,
22
Inc., 2011 WL 1753982, at *15 (N.D. Cal. May 9, 2011); see also Groupion, LLC v. Groupon,
23
Inc., 2012 WL 359699, at *2 (N.D. Cal. Feb. 2, 2012). Generally, “[i]n determining whether to
24
allow an apex deposition, courts consider (1) whether the deponent has unique first-hand, non-
25
repetitive knowledge of facts at issue in the case and (2) whether the party seeking the deposition
26
has exhausted other less intrusive discovery methods.” Affinity Labs, 2011 WL 1753982, at *15
27
1
28
The Court notes that the request for protective order is jointly sought by Mr. Murphy and
LivePerson. (Joint Letter at 1.)
2
1
(citing WebSideStory, Inc. v. NetRatings, Inc., 2007 WL 1120567, at *2 (S.D. Cal. Apr. 6, 2007).
2
“The apex deposition principle is not an automatic bar that Plaintiffs must overcome by a showing
3
of good cause.” In Re Nat'l W. Life Ins. Deferred Annuities Litig., 2011 WL 1304587, at *4 n. 2
4
(S.D. Cal. Apr. 6, 2011); see also Powertech Tech., Inc. v. Tessera, Inc., 2013 WL 3884254, at *1
5
(N.D. Cal. July 26, 2013). “Rather, it is a protective tool that is selectively employed on a case by
6
case basis when deemed appropriate.” In Re Nat'l W. Life Ins. Deferred Annuities Litig., 2011 WL
7
1304587, at *4 n. 2.
Here, [24]7’s representation regarding Mr. Murphy’s prior position at LivePerson indicates
8
9
that he may possess unique, first-hand knowledge of relevant facts, because he “led the charge on
LivePerson’s financial analyses and strategy, directing and revising LivePerson’s customer
11
United States District Court
Northern District of California
10
attrition and renewal reports as well as its revenue and bookings forecasts[, which] are relevant to
12
both causation and damages.” (Joint Letter at 4.) Mr. Murphy also wrote emails discussing
13
LivePerson’s competition with [24]7 and the alleged loss of the customers at issue in this
14
litigation. Id. [24]7 also contends that “Mr. Murphy’s comprehensive knowledge of LivePerson’s
15
financials is unique, particularly with respect to LivePerson’s customer attrition analysis, which
16
Mr. Murphy personally summarized for CEO Robert LoCascio and presented to the board of
17
directors.” (Joint Letter at 5.) The Court also notes that, until recently, Mr. Murphy was included
18
on LivePerson’s initial disclosures as a witness with discoverable knowledge who would support
19
its case. (Joint Letter at 4.) “[W]hen a witness has personal knowledge of facts relevant to the
20
lawsuit, even a corporate president or CEO is subject to deposition.” WebSideStory, 2007 WL
21
1120567, at *2. There is also no indication that [24]7 seeks to depose Mr. Murphy for an improper
22
purpose, such as harassment. See id. (citing Mulvey v. Chrysler Corp., 106 F.R.D. 364 (D.C. R.I.
23
1985).
24
Moreover, the Court does not find the apex doctrine determinative, because Mr. Murphy is
25
no longer employed by LivePerson. See Carroll v. Wells Fargo & Co., 2016 WL 8673482, at *3
26
(N.D. Cal. Dec. 9, 2016). While Mr. Murphy’s departure was recent, such that LivePerson’s
27
responses to written discovery based on corporate knowledge should have included the
28
information that he possesses, this does not mean that [24]7 should be deprived of asking him
3
1
questions about documents he authored or how he conveyed his knowledge to others, including
2
LivePerson’s CEO and the company’s board of directors. (See Joint Letter at 4-5.) Similarly,
3
given his high level position at the company, and the disclosure that he is a witness with relevant
4
knowledge, the depositions of other employees may not necessarily overlap with his personal
5
knowledge. Since Mr. Murphy is no longer employed by LivePerson, a deposition is virtually the
6
only discovery method available to ascertain his personal knowledge. If Mr. Murphy does not
7
possess relevant, first-hand knowledge, the deposition should be short, and the resulting burden
8
minimal.
9
Notwithstanding, [24]7 must show that the deposition is proportional to the needs of the
case under Rule 26. While the undersigned is somewhat concerned that [24]7 did not ask the two
11
United States District Court
Northern District of California
10
corporate witnesses questions regarding “customer attrition analyses or strategy,” the Court finds
12
that [24]7 has met its burden given that the undersigned has found that the apex doctrine is not
13
determinative. (See Joint Letter at 3-5.)
14
In seeking a protective order, LivePerson and Mr. Murphy have not sufficiently
15
demonstrated what harm or prejudice would result from the deposition going forward beyond the
16
argument that the apex doctrine should preclude the deposition and that the deposition would
17
generally impose an undue burden. (See Joint Letter at 3.) As a result, the request for protective
18
order is denied.
19
Accordingly, [24]7 is permitted to take Mr. Murphy’s deposition.
20
III.
CONCLUSION
21
In light of the foregoing, [24]7’ request to compel compliance with Mr. Murphy’s
22
deposition subpoena is granted, and LivePerson and Mr. Murphy’s joint request for a protective
23
order is denied. The parties shall meet and confer regarding scheduling.
24
25
IT IS SO ORDERED.
Dated: March 14, 2018
__________________________________
KANDIS A. WESTMORE
United States Magistrate Judge
26
27
28
4
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?