Anwar et al v. Fairfield Greenwich Limited et al

Filing 843

ENDORSED LETTER addressed to Magistrate Judge Theodore H. Katz from Alan H. Rolnick dated 3/23/12 re: Counsel for the plaintiff Headway Investment Corporation writes to request the Court's protection from the Standard Chartered Defendants' notice of deposition of two Headway officers who have no unique or superior knowledge regarding the facts in this case, and two non-party witnesses who are neither officers nor directors of Headway. ENDORSEMENT: On the representation that neither Mr. Grande Rodriguez nor Mr. Grande de Andres possessed any general responsibilities regarding the matters in this litigation and did not exercise any control over Headway's investment activities, and on the assumption that they will not offer either written or live testimony in this action, they need not appear for deposition. If Mr. Herrando and Mr. Andres had no involvement in Headway's investment decision, including the decision to invest in Sentry, were not consulted for Headway's investment decisions, and were not advised about Headway's investment decisions, they shall so state in a sworn affidavit and need not appear for deposition. (Signed by Magistrate Judge Theodore H. Katz on 3/30/2012) Filed In Associated Cases: 1:09-cv-00118-VM-THK et al.(mro) Modified on 4/3/2012 (mro).

Rivero Mestre LLP

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www.riveromestre.com

By fax
Honorable Theodore H. Katz
United States Magistrate Judge
Daniel Patl-ick Moynihan U.S. Courthouse
500 Pearl Street
New York, New York 10007-1312
Ret

Anwa,.~

et al. v. Fairfield Greenwich Li ited, et al.,

09-cv-llS (VM)(THK)

Standard Chartered Cases
Dear Judge Katz:
I write on behalf of Plaintiff Headway Investment
("Headway") to request the Court's protection from the S
Defendants' notice of deposition of two Headway officers
or supeI'jor knowledge regarding the facts in this case, a
witnesses who are neither officers nor directors of Head

Corporation
andard Chartered
ho have no unique
d two non-party
ay.l

On March 3,2012, Standard Chartered (the "Ba ") served on
Headway a notice of four depositions. The four individua s the Bank seeks to
depose on notice include: (1) Adan Arturo Illueca Henan 0, Headway's
president. noticed for Mal'ch 29,2012; (2) Julio Grande
dres. Headway's
vice-president, noticed for April 4, 2012; (3) Julio Grande Rodriguez, noticed
fOl' April 2, 2012; altd (4) Ofelia Grande de Andres, notic
for April 3, 2012.2
All four putative witnesses live abroad. Ml.. Illueca Herr ndo is a resident
and citizen of Panama, while the other three putative wi neases, who are t.he
brothel'-in-Iaw, niece, and nephew of German Sanchez, F adway's recently
deceased controlling shareholdel', all are residents and ci izens of Spain.

1 A copy of the Standard Chartel'ed Defendant.s' Third Notice of Dap sitions is attached as
Exhibit 1.
2 The Bank unilat.erally pl.u·ported to schedule these depositions. In i s transm.ittal em.ail, the
Bank's counsel did offer to reschedule the depositions in light of the arties' and witnesses'
respe<:tive schedules. Since all four witnesses live abroad, if the CQ1· were to deny
Headway's request for a protective order, we would ask that any dep sitions be rescheduled
for mutually available dates.

Hon. Theodore H. Katz
March 23, 2012
Page - 2
w

Mr. Illueca Herrando and Mr. Grande Andres ha e no knowledge (let
alone unique or superior knowledge) regarding the fact of t.his case. As
Headway's President and Vice-President, they may not e deposed unless
and until the Bank can satisfy the Apex deposition stan ard by showing that
discovery from other Headway representatives left criti al gaps in the factual
record, a showing the Bank has not even attempted to aka. Although the
Bank's harassment of the late 1\11'. Sanchez might have uggested
unawareness of the Apex deposition doctrine, the Bank 'well awaI'e of it.
but evidently thinks it applies only to its own officers. S e lettel' to the Court
from Diane L. McGimsey, Esq., dated February 27,201 • seeking a protective
order as to Plaintiffs' notice of Bank CEO Richard Holm s' deposition (which
the Court granted).
As for the other two purported deponents, Ms. O£ lia Grande de
Andres has never been an officer, director or employee 0 Headway, and may
not be deposed on notice to Headway. Her father, Mr. G ande Rodriguez, has
not been an officer or director of Headway since 2002, m nths before the
Bank induced Headway's initial il1vestment in the bogu Fairfield Funds.
Theu' only connection to this case is the fact that they h ve signatory power
(which has never been used) on Headway's accounts wit the Bank. As such.
Headway is under no obligation to attempt to produce M . Grande Rodriguez
or Ms. Ofelia Gl'ande de Andres for deposition. S This lett r need not and does
not further address the Bank's purported notice of these
depositions, which should be deemed a llullity.
It is necessary. however, to further address the B
of deposition regarding the two Headway officers. The fa
case does not suggest that Mr. Dlueea Herrando or l\1r.
"any unique or superior knowledge of any issues ofrelev
lawsuit."4In fact, it does the opposite. Out of all the doc

's impropel' notice
tual record in this
rande Andres have
nce in this
nents produced by

B As a courtesy, Headway informs the Bank: that it has no obligation to produce non-parties
Julio Grande Rodriguez or Ofelia Grande de Andres on the noticed aoos. They are non­
parties living in Spain who have no relationship with Headway othe than being family
members of its former controlling shareholder and possessing (unus d) signatory powel' as to
Headway's Bank accounts.
4 Counsel for the Bank should find this sentence familiar, as we are uoting from ?vIs.
McGimsey'a Februaxy 27, 2012 letter seeking a protective order aga' st the noticed
deposition of Richard Holmes, the former President, Chairman. and EO of American
Express Bank Limited, and the current CEO, UK and Europe, of S ndard Chartered Bank.
On March 7, 2012, this Court granted that protective order. without rejudice. despite
evidence that Mr. Holmes was present and involved in the meeting here the Bank approved
sales of the Sentry Fund, In sharp contrast, there is nothing :in the r cord to establish that
Mr. rHueca Herrando and Mr, Grande Andres played any role in an decisions relevant to
this case. let alone that they might have any unique or special know dge of material facts.

Hon. Theodore H. Katz
March 23, 2012
Page - 3 ­

Headway and the Bank, there are none that support an assertion that Mr.
Illueca Herrando and Mr. Grande Andres have any uni ue or superior
knowledge regarding material facts. As such, the Court 'hould grant
Headway's request for a protective order. See Consolo R il Corp. v. Primm."
Indus. Corp., 1993 WL 364471, at *1 (S.D.N.Y. 1993) (c urt defel'l'ed any
depositions of senior executives "until it [is] determined that they have some
unique knowledge pertinent to the issues in these cases "); see also Malletier
v. Dooney & Bourke Inc., 2006 WL 3476735, at *12 (S. .N.Y., 2006) ("[T]he
courts have agreed that if a party seeks to depose a vel' senior official of all
adversary entity, the adversary may obtain an order va ating the deposition
notice if it can demonstrate that the PI'oposed deponent as no personal
knowledge of the relevant facts and no unique knowled of those facts.")
J

"When considering whether to allow the depositio of a corporate
executive, courts consider the likelihood that the individ al possesses
relevant knowledge and whether another source could p ovide identical
information." See Treppel v. Biovail Corp" No. 03-Civ-3 2. 2006 WL 468314,
at *2 (S.D.N.Y. 2006). Here, "another source" has alread provided identical
information. As the Court is aware, the Bank struggled ightily to avoid
characterizing its March 13, 2012 deposition of Carlos G nzalez as a Rule
30(b)(6) deposition of Headway, despite it having been e actly that. Mr.
Gonzalez is Headway's "control person"(to use the Bank' preferred term} and
. its authorized representative. Almost all ofbis depositio was devoted to his
activities on behalf of Headway, despite the Bank's purp rted goal of
deposing him only as the corporate representative of no party Cyma Group,
Inc ("Cyma"). Semantics aside, it is undeniable that a su atantial portion of
the questions the Bank asked Mr. Gonzalez dealt with
..at Headway did,
and none of his testimony remotely suggested that he la ked any knowledge
of the material facts herein.
In his deposition, MI-. Gonzalez conmmed what H adway asserted and
the Bank always knew, that as Mr. Sanchez' designated epresentative, Mr.
Gonzalez handled Headway's daily affairs, was the Head ay l'epresentative
with whom the Bank met. and the one to whom they tou ed and sold these
bogus investments. Moreover, Mr. Gonzalez' testimony so demonstrated
that the Headway officers and directors, including Mr. H rrando and Mr.
Grande Andres, had no role in making or maintaining,
d knew nothing
about, Headway's different investments, including its ill- ted investment in
the Fairfield Funds. I)

S Headway has designated the March 13, 2012 Deposition of Carlos onzalez as confidential
in acoordance with the Court's Febl'uary 3, 2011 Stipula.tion and Or r Governing

Hon. Theodore H. Katz
March 23,2012
Page - 4­
The Bank may argue that it has the power to not'ce the depositions of
Headway's officers in accordance with Fed. R. Civ. P. 3 (h)(l). While this may
literally be true, it does not relieve the Bank of its burd n to satisfy the
standard for taking an Apex deposition. Moreover, beea se of the Bank's
dogged refusal to notice a Headway Rule 30(b)(6) depos ion, the Bank should
not now be heard to complain that it had no opportunit to obtain relevant
information by deposing a non-officer (which it in fact h s done, despite
refusing to admit it).6 The evidence in this case ineluct ly leads to the
conclusion that Mr. Illueca Herrando and Mr. Grande
dres have no
personal knowledge of the relevant facts, much less any "unique and
superior" knowledge of such facts. See Malletier, 2006
3476735 at 12.7
The Bank knows all this, and almost certainly
w it before this
action ever was filed, because of its long-standing relati nsh:ip with Headway
through Mr. Gonzalez. Even if it didn't, the wealth of do uments and
testimony herein establish no basis for the Bank's conti uing harassment of
Headway, through a demand fOl' meaningless, burdenso e, and costly
depositions of officers who live abroad and have no kno ledge offacts
material to this case. Rule 26(c)(1) supports issuance of l an order to protect a
party or person from annoyance, embarrassment, oppre sion, or undue
burden or expense." In making that determination, "'the likelihood of
harassment ... [is a] factor to be considered in decidin whether to al.1ow
discovery of corporate executives.'" Lin v. Benihano Nat Corp., 2010 WL
4007282, at *2 (S.D.N.Y. 2010) (quoting General Star In em. Co. v. Platinum
Indem., Ltd., 201 F.R.D. 80. 83 (S.D.N.Y. 2002». Good c use exists here.
For all these reasons, Headway respectfully requ ts issuance of a
protective order or its equivalent to prevent the Bank fr m misusing the

Confidentiality of Discovery Material for the Standard Chartered C es. If the Court
requests specific instances of Mr. Gonzalez' testimony, Headway w" provide transcripts of
that testimony under seal.
6 As the Court is aware, in permitting the Bank's deposition of Mr.
nzalez solely in bis
capacity as Cyma's corporate representative, over Headway's object' n that the door might
l'emain open to a demand for his deposition as Headway's most kno ledg~able corporate
representative, the Court also ruled that it "assumes that Mr. Gonz as Will be deposed only
one time." See March 8,2012 Letter from. D. McGimsey to Judge Ka z, Endorsed March 9,
2012. Consequently, the Bank may not further depose the most!mo led~able Headway
representative and, in actual fact. seems desperate to depose Head y representatives who
are not knowledgeable, w bich the law neither requires not permits.
7 We note that the Bank did not provide an affida'vit from. Richard H lm.as attesting to his
"lack. of' unique 01" superior knowledge. Ifneed be. Headway will pr ide affidavits from Mr.
Illueca Herrando and Mr. Grande Andres demonstrating their lack fknowledge regal'ding
the material facts of this case.

Hon. Theodore H. Katz
March 23. 2012
Page - 5­
ru1~s of Court for the purpose of harassment, and to prevent the Bank from
takmg any of the four depositions it has noticed.

Yours truly,

~A;:;;;;£r; ;::·1

:"......",.:;..

FOr Alan H. Rolnick i
Cmillsel for Headlway Investment
Corporation