Bison Advisors LLC v. Kessler et al

Filing 186

ORDER re 172 APPEAL/OBJECTION OF MAGISTRATE JUDGE DECISION to District Judge; Overruling 171 Order on Motion to Compel; Order on Motion for Protective Order; Order on Motion for Discovery. (Written Opinion). Signed by Senior Judge David S. Doty on 7/24/2015. (DLO)

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Civil No. 14-3121(DSD/SER)
Bison Advisors LLC, a Minnesota
limited liability company,
Plaintiff,
ORDER

v.
Irvin Kessler, Peter Goddard and
Walleye Trading Advisors LLC, a
Minnesota limited liability company,
Defendant.

Jeffrey J. Bouslog, Esq. and Oppenheimer, Wolff &
Donnelly, LLP, 222 South Ninth Street, Suite 2000,
Minneapolis, MN 55402, counsel for plaintiff.
William Z. Pentelovitch, Esq. and Maslon, Edelman, Borman
& Brand, 90 South Seventh Street, Suite 3300,
Minneapolis, MN 55402, counsel for defendant.

This

matter is

defendants

Irvin

before

Kessler,

the
Peter

court

upon

Goddard,

the

and

objections of

Walleye

Trading

Advisors LLC to the June 29, 2015, order of Magistrate Judge Steven
E. Rau.

Based on a review of the file, record, and proceedings

herein, and for the following reasons, the court overrules the
objections.

BACKGROUND
In

this

business

dispute,

plaintiffs

Bison

Advisors

LLC

(Bison), Argos Capital Management Inc. (Argos), and Ephraim Gildor,
allege

that

defendants

misappropriated

various

trade

secrets

belonging to Bison.

On April 20, 2015, defendants provided notice

that Gildor’s individual deposition would take place on May 13,
2015, at 9:00 a.m.

Plaintiffs also noticed Bison’s deposition

under Rule 30(b)(6) for the same day, but to begin at 1:30 p.m.
The

notices

provided

that

each

deposition

was

“thereafter from time to time until completed.”

to

continue

Because Gildor is

the sole owner of Argos and Argos is the sole member of Bison, the
parties

understood

that

Gildor

would

representative for Bison’s deposition.

be

the

corporate

At the time, the parties

were operating under a May 18, 2015, deadline to complete fact
discovery.
On May 8, 2015, defendants served an amended notice that
rescheduled the Bison deposition to May 15. Plaintiffs objected to
the amended notice the same day, stating that the testimony offered
in

Gildor’s

individual

deposition

testimony on behalf of Bison.

would

be

identical

to

his

On May 12, defendants also noticed

a 30(b)(6) deposition of Argos for May 18.
Gildor’s

individual

deposition

scheduled, and it ended around 7 p.m.

took

place

on

May

13

as

Although Bison’s 30(b)(6)

deposition did not go forward that day, Gildor’s testimony was
adopted as binding on Bison.

The parties dispute whether that

testimony adequately addresses the topics that would likely have
been covered during Bison’s deposition.

Plaintiffs thereafter

notified defendants that they would not be producing a witness for

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either the Bison or Argos depositions. In an attempted compromise,
defendants offered to conduct a joint seven-hour deposition of the
two entities. Plaintiffs agreed so long as the deposition would be
limited to two hours. Defendants rejected the counterproposal, and
neither Argos nor Bison appeared for their noticed depositions.
On June 15, 2015, defendants filed a motion to compel Bison
and Argos to appear.
a

protective

order

ECF No. 117.
on

additional depositions.

the

same

Plaintiffs filed a motion for
day,

ECF No. 124.

seeking

to

prevent

any

On June 29, the magistrate

judge granted and denied both motions in part.

ECF No. 171.

Specifically, the magistrate judge ordered Gildor to appear as the
corporate representative for a three and a half hour combined
deposition of Bison and Argos.

Id. ¶ 1.

Defendants now object,

requesting that the court increase the time allotted for the
deposition to seven hours.

DISCUSSION
The district court will modify or set aside a magistrate
judge’s order on a nondispositive issue only if it is clearly
erroneous or contrary to law.

28 U.S.C. § 636(b)(1)(A); Fed. R.

Civ. P. 72(a); D. Minn. L.R. 72.2(a).
deferential” standard.

This is an “extremely

Reko v. Creative Promotions, Inc., 70 F.

Supp. 2d 1005, 1007 (D. Minn. 1999).

“A finding is clearly

erroneous when although there is evidence to support it, the

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reviewing court on the entire evidence is left with the definite
and firm conviction that a mistake has been committed.”

Chakales

v. Comm’r, 79 F.3d 726, 728 (8th Cir. 1995) (citations and internal
quotation marks omitted).

“A decision is contrary to law when it

fails to apply or misapplies relevant statutes, case law or rules
of procedure.”

Knutson v. Blue Cross & Blue Shield of Minn., 254

F.R.D. 553, 556 (D. Minn. 2008) (citations and internal quotation
marks omitted).
Defendants argue that the magistrate judge clearly erred by
limiting the combined depositions of Bison and Argos to no more
than three and a half hours.

The court disagrees.

“Unless

otherwise stipulated or ordered by the court, a deposition is
limited to 1 day of 7 hours.”

Fed. R. Civ. P. 30(d)(1).

District

courts have broad discretion to decide discovery motions and to
limit discovery.
Cir. 1993).

Pavlik v. Cargill, Inc., 9 F.3d 710, 714 (8th

Likewise, the court has discretion “to decide when a

protective order is appropriate and what degree of protection is
required.” May Coating Techs., Inc. v. Ill. Tool Works, 157 F.R.D.
55, 57 (D. Minn. 1994).
“A deposition pursuant to Rule 30(b)(6) is substantially
different from a witness’s deposition as an individual.”

Sabre v.

First Dominion Capital, LLC, No. 01-2145, 2001 WL 1590544, at *1
(S.D.N.Y. Dec. 12, 2001).

“The testimony elicited at the Rule

30(b)(6) deposition represents the knowledge of the corporation,

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not of the individual deponents.”

A.I.A. Holdings, S.A. v. Lehman

Bros., Inc., No. 97-4978, 2002 WL 1041356, at *2 (S.D.N.Y. May 23,
2002) (quotation omitted).

As a result, an individual deposed

under

also

Rule

30(b)(1)

but

designated

as

a

corporate

representative under Rule 30(b)(6) is often required to appear for
a separate seven-hour deposition on behalf of the corporation. See
id. at *2-3.

In contrast, a separate deposition of a closely held

corporation may not be appropriate where the testimony of the
corporate representative would be identical to the testimony given
in his or her individual capacity.

See Nicholas v. Wyndham Int’l,

Inc., 373 F.3d 537, 543 (4th Cir. 2004) (finding no abuse of
discretion where 30(b)(6) deposition was denied, noting that the
either of the plaintiffs who had been deposed in their individual
capacity

would

have

been

designated

as

the

corporate

representative); Sabre, 2001 WL 1590544, at *2 (stating that a
deposing party does not have “carte blanche to depose an individual
for seven hours as an individual and seven hours as a 30(b)(6)
witness”).
The court finds that the magistrate judge acted well within
his discretion when limiting the combined 30(b)(6) deposition of
Argos and Bison to three and a half hours.

The parties agree that

at least some of the testimony to be offered in the combined
deposition would be duplicative of testimony offered by Gildor in
his individual capacity.

Indeed, much of Gildor’s testimony was

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adopted as binding on Bison. See A.I.A. Holdings, 2002 WL 1041356,
at *3 (“A 30(b)(6) deposition may not be justified where ... the
entity establishes that the witness’s testimony ... would be
identical to his testimony as an individual ....”).

Moreover, as

noted by plaintiffs, defendants will also have an opportunity
during expert discovery to depose plaintiffs’ expert witness on
trade secret matters that may not be covered in the time allotted
for the 30(b)(6) deposition.

See Fed. R. Civ. P. 26(b)(2)©

(allowing the court to limit discovery that can be obtained from
other sources).

The solution crafted by the magistrate judge

constitutes a reasonable compromise of the parties’ dispute, and it
is neither clearly erroneous nor contrary to law. As a result, the
court overrules the objections.

CONCLUSION
Accordingly, based on the above, IT IS HEREBY ORDERED that the
objections to the magistrate judge’s June 29, 2015, order [ECF No.
172] are overruled.
Dated: July 24, 2015
s/David S. Doty
David S. Doty, Judge
United States District Court

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