Soroof Trading Development Company LTD. v. GE Fuel Cell Systems LLC. et al

Filing 164

MEMORANDUM AND ORDER terminating 152 Motion for Protective Order. Accordingly, the defendants shall produce another Rule 30(b)(6) witness or properly prepare Mr. Scovello to testify about these topics within two weeks of the date of this Order. See Fab-Tech, Inc. v. E.I. Du Pont De Nemours and Co., No. 104CV275, 2006 WL 3702753, at *2 (D. Vt. Dec. 13, 2006) (When a designee is unable to adequately respond to certain relevant areas of inquiry, the designating party has a duty to substitute an a ppropriate deponent. (internal quotation marks omitted)); Sony Electronics, Inc. v. Soundview Technologies, Inc., 217 F.R.D. 104, 112 (D. Conn. 2002) (ordering plaintiff to produce additional Rule 30(b)(6) witness when its designee was unable to testify about topics included in deposition notice). Fact discovery is otherwise complete. (Signed by Magistrate Judge James C. Francis on 3/28/2013) Copies Mailed By Chambers. (lmb)

UNITED STATES DISTRICT COURT
(ECF)
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - - -:
SOROOF TRADING DEVELOPMENT
: 10 Civ. 1391 (LGS) (JCF)
COMPANY, LTD.,
:
:
MEMORANDUM
Plaintiff,
:
AND ORDER
:
- against :
:
GE FUEL CELL SYSTEMS, LLC,
:
GE MICROGEN, INC., and PLUG POWER, :
INC.,
:
Defendants.
:
- - - - - - - - - - - - - - - - - -:
JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE
Soroof Trading Development Company, Ltd. (“Soroof”) brings
this action for breach of contract and misrepresentation against GE
Microgen, Inc. (“GE Microgen”) and Plug Power, Inc. (“Plug Power”)
-- who were members of the now-defunct GE Fuel Cell Systems, LLC
(“GEFCS”) -- as well as the General Electric Company (“GE”), the
corporate

parent

of

GEFCS.

The

plaintiff

seeks

to

compel

additional depositions from GE and GE Microgen under Rule 30(b)(6)
of the Federal Rules of Civil Procedure.1

1

Plug Power moved for a protective order to prevent Soroof
from deposing George C. McNamee, Chairman of Plug Power’s Board of
Director. (Docket no. 152). On February 28, 2013, the plaintiff
voluntarily withdrew its notice of deposition of Mr. McNamee.
(Response in Opposition to Defendant Plug Power Inc.’s Motion for
Protective Order Prohibiting the Deposition of George C. McNamee).
Accordingly, Plug Power’s motion is moot.
1

Background
The factual background of this dispute is set forth in my May
11, 2012, Memorandum and Order and will only be summarized briefly
here.

Soroof Trading Development Co. v. GE Microgen, Inc., 283

F.R.D. 142 (S.D.N.Y. 2012).
In June 2000, GEFCS and Soroof entered into an agreement under
which, for a $1 million distribution fee, Soroof would have the
right to distribute GEFCS-produced fuel cells meeting certain
specifications in Saudi Arabia.

(Distributer Agreement dated June

6, 2000 (“Agreement”), attached as Exh. 1 to Second Amended
Complaint (“SAC”), ¶¶ 1-2.3, 6.4).

Soroof claims that GE, GE

Microgen, and Plug Power knew by the time GEFCS was formed that
there was a “strong possibility that the [contemplated fuel cells]
would never be marketable.”

(SAC, ¶ 19).

Nevertheless, they

allegedly misrepresented to Soroof that the project would succeed.
(SAC, ¶¶ 22, 24, 29, 39-40, 47).
able

to

make

fuel

cells

As it turned out, GEFCS was not

that

met

the

specifications

in

the

Agreement and purportedly abandoned development within a year.
(SAC, ¶¶ 37, 41, 47).

In 2006, GEFSCS was dissolved, supposedly

without the plaintiff’s knowledge.

(SAC, ¶ 56).

This litigation

ensued, alleging breach of contract and misrepresentation.
Soroof

issued

deposition

pursuant to Rule 30(b)(6).

notices

to

GE

and

GE

Microgen

(Plaintiff Soroof Trading Development
2

Company, Ltd.’s Amended Notice of Deposition Pursuant to Rule
30(b)(6) to Defendant General Electric Company (“Rule 30(b)(6)
Notice to GE”) dated Nov. 29, 2012, attached as Exh. 2 to Letter of
Aaron W. Knights dated Feb. 13, 2013 (“Knights Letter”); Plaintiff
Soroof

Trading

Development

Company,

Ltd.’s

Amended

Notice

of

Deposition Pursuant to Rule 30(b)(6) to Defendant GE Microgen, Inc.
(“Rule 30(b)(6) Notice to GE Microgen”) dated Nov. 29, 2012,
attached as Exh. 3 to Knights Letter).

GE and GE Microgen

designated Frank Scovello in response to the notices, and on
December 10, 2012, the plaintiff deposed Mr. Scovello. (Deposition
Transcript of Frank Scovello dated Dec. 10, 2012 (“Scovello Dep.”),
attached as Exh. 4 to Knights Letter, at 8).2
Discussion
Rule 30(b)(6) provides:
[A] party may name as the deponent a public or private
corporation . . . and must describe with reasonable
particularity the matters for examination.
The named
organization must then designate one or more officers,
directors, or managing agents, or designate other persons who
consent to testify on its behalf . . . .
The person
designated must testify about information known or reasonably
available to the organization.
“Rule 30(b)(6) thus establishes a two-stepped process.”

2

Sheehy v.

Mr. Scovello was previously deposed on September 2, 2010, on
behalf of GE Microgen during the first phase of discovery, which
was confined to issues relating to GEFCS’s dissolution. (Knights
Letter at 3 n.2).
3

Ridge Tool Co., No. 3:05-CV-01614, 2007 WL 1548976, at *4 (D. Conn.
May 24, 2007).

The party seeking a Rule 30(b)(6) deposition must

first serve a notice that describes “with reasonable particularity”
the issues and topics that will be addressed at the deposition.
Id.; Fed. R. Civ. P. 30(b)(6).

“The purpose of this rule is to

avoid the difficulties encountered by both sides when the party to
be examined is unable to determine who within the corporation would
be best able to provide the information sought.”

Innomeds Labs,

LLC v. Alza Corp, 211 F.R.D. 237, 240 (S.D.N.Y. 2002).
Once the deposing party has served a satisfactory notice, the
responding party is required to “make a conscientious good-faith
endeavor to designate the persons having knowledge of the matters
sought by [the party noticing the deposition] and to prepare those
persons

in

order

that

they

can

answer

fully,

completely,

unevasively, the questions posed . . . as to the relevant subject
matters.’”

Tailored Lighting Inc. v. Osram Sylvania Products,

Inc., 255 F.R.D. 340, 349 (W.D.N.Y. 2009) (alterations in original)
(quoting Securities Exchange Commission v. Morelli, 143 F.R.D. 42,
45 (S.D.N.Y. 1992)) (internal quotation marks omitted); see Reilly
v. Natwest Markets Group, Inc., 181 F.3d 253, 268 (2d Cir. 1999)
(“To

satisfy

Rule

30(b)(6),

the

corporate

deponent

has

an

affirmative duty to make available ‘such number of persons as will’
be able ‘to give complete, knowledgeable and binding answers’ on
4

its behalf.’” (quoting Austin v. Healey, 5 F.3d 598, 601 (2d Cir.
1993)). While the “‘Rule 30(b)(6) deponents need not have personal
knowledge concerning the matters set out in the deposition notice
. . . the corporation is obligated to prepare them so that they may
give knowledgeable answers.’”

Meyer Corp. U.S. v. Alfay Designs,

Inc., No. 10 CV 3647, 2012 WL 3536987, at *8 (E.D.N.Y. Aug. 13,
2012) (alteration in original) (quoting Spanski Enterprises, Inc.
v. Telewizja Polska, S.A., No. 07 Civ. 930, 2009 WL 3270794, at *3
(S.D.N.Y. Oct. 13, 2009)).

The responding party must “prepare the

designee ‘to the extent matters are reasonably available, whether
from documents, past employees, or other sources.’”

Rahman v.

Smith & Wollensky Restaurant Group, Inc., No. 06 Civ. 6198, 2009 WL
773344, at *1 (S.D.N.Y. March 18, 2009) (quoting Tailored Lighting
Inc., 225 F.R.D. at 349)); In re Air Cargo Shipping Services
Antitrust Litigation, No. 06 MD 1775, 2012 WL 1129852, at *1
(E.D.N.Y. March 27, 2012); cf. Panolam Industry International, Inc.
v. F & F Composite Group Inc., No. 3:07CV1721, 2010 WL 341330, at
*1 (D. Conn. Jan. 22, 2010) (“A deponent under Rule 30(b)(6) has an
‘affirmative obligation to educate himself as to the matters
regarding the corporation.
known

or

reasonably

This includes all matters that are

available

to

the

corporation.’”

(quoting

Concerned Citizens v. Belle Haven Club, 223 F.R.D. 39, 43 (D. Conn.
2004))).

“[P]roducing an unprepared witness is tantamount to a
5

failure to appear.”

Rahman, 2009 WL 773344, at *1.

Soroof contends that GE and GE Microgen failed to meet their
obligations under Rule 30(b)(6) because Mr. Scovello was unable to
testify about information to which GE was privy as a result of its
holding a position on Plug Power’s Board of Directors.
Letter at 3).

(Knights

It points to Mr. Scovello’s lack of knowledge about

documents that the defendants had produced in regard to this issue,
including:
(1) a document prepared for Plug Power’s Board identifying
“shortfalls or the progress of the development of the product
from Plug Power”;
(2) a document which related GE’s decision not to make further
equity investments in Plug Power’s program as a result of a
due diligence review GE conducted; and
(3) a document which stated that Plug Power had not focused on
commercially viable product.
(Knights Letter at 3; General Electric Company and GE Microgen
Inc.’s Opposition to Plaintiff’s Motion to Compel Additional FRCP
30(b)(6) Deposition Testimony of General Electric Company and GE
Microgen Inc. (“Def. Memo.”) at 3).

This information, Soroof

argues, is “highly relevant” to its claims in this case -- that the
defendants failed to disclose material information to Soroof, and
given GE’s worldwide reputation, that Soroof relied on GE giving
its seal of approval to Plug Power’s product.
4).

6

(Knights Letter at

The defendants do not deny that Mr. Scovello was unable to
testify about these matters.

Rather, they contend that Soroof’s

Rule 30(b)(6) notices did not identify those topics, that Soroof
never asked Mr. Scovello any questions to establish whether he
lacked knowledge on those issues as “GE’s corporate designee (as
opposed to he as President of GEFCS),” and that Soroof already has
documents

that

provide

testimony unnecessary.
A.

this

information,

rendering

further

(Def. Memo. at 3-4, 9-10).

Soroof’s Rule 30(b)(6) Notice

Soroof’s notice to GE identified twenty-eight categories of
information sought, including:
2.

Any and all assistance provided by GE to [Plug Power] to
develop the Product.

3.

GE’s knowledge of [Plug Power’s]
commercializing the Product. . . .

5.

Involvement of GE employees in the development of the
Product. . . .

9.

The Product’s failure to meet GE’s specifications. . . .

14.

Any communication or discussion regarding the development
of the Product. . . .

23.

Any and all documents exchanged by the parties in this
action.

24.

Any and all communication with Plaintiff.

7

difficulties

in

(Rule 30(b)(6) Notice to GE at 7-8).3

The notice “call[ed] for all

information known or available to [GE]” on these topics.

(Rule

30(b)(6) Notice to GE at 4).4
Although

the

notice

did

not

specify

that

Soroof

sought

information obtained by GE through its membership on Plug Power’s
Board of Directors, such information falls within information known
or available to GE and is well within GE’s control.

See In re Air

Cargo Shipping, 2012 WL 1129852, at *1 (“There is no question that
Rule 30(b)(6) requires a party to designate witnesses who can
provide all the relevant information known or reasonably available
to the entity.” (internal quotation marks omitted)); Twentieth
Century Fox Film Corp. v. Marvel Enterprises, Inc., No. 01 Civ.
3016, 2002 WL 1835439, at *4 (S.D.N.Y. Aug. 8, 2002) (“[T]he same
principle that is applied to interrogatories and document requests
should

also

be

applied

to

determine

the

scope

of

a

party’s

obligation in responding to a Rule 30(b)(6) notice of deposition.
There is no logical reason why the sources researched by a party in
responding to a discovery request should be dependent on the
particular discovery vehicle used; in all cases, the responding

3

Soroof identified similar categories in its notice to GE
Microgen. (Rule 30(b)(6) Notice to GE Microgen, ¶¶ 2, 4, 14, 2526).
4

Soroof made the same request in its notice to GE Microgen.
(Rule 30(b)(6) Notice to GE at 4).
8

party should be obligated to produce the information under its
control.”); Securities Insurance Co. of Hartford v. Trustmark
Insurance Co., 218 F.R.D. 29, 34 (D. Conn. 2003) (“In light of the
affirmative duty imposed by Rule 30(b)(6), [defendant]’s corporate
representative was obliged to gain some understanding of the
underlying facts, regardless of the source identifying underlying
facts, and to answer questions accordingly” even if witness’s
understanding is gleaned from documents protected as work product).
Furthermore, the questions regarding the documents that Mr.
Scovello testified he had never seen and had no knowledge about
fall within the topics identified in the plaintiff’s notice. These
documents were presented at Plug Power’s Board meetings during the
time GE was represented on the Board.

Soroof asked about a Q2

Dashboard Summary Presentation to Plug Power Board of Director
dated July 17, 2000, reporting that Plug Power was unable to meet
its targets (Scovello Dep. at 84-85); a memorandum from Plug Power
to, among others, the GE representative on Plug Power’s Board dated
September 12, 2003, noting a due diligence review conducted by GE
and GE’s decision not to make further equity investments in Plug
Power (Scovello Dep. at 183-85); and a Plug Power Update dated
August 19, 2003, with GE’s logo, concluding that Plug Power’s
research and development resources should be more focused on

9

commercially viable products (Scovello Dep. at 185-89).5

All of

these documents reasonably fall within the categories noticed by
the plaintiff.

See Crawford v. Franklin Credit Management Corp.,

261 F.R.D. 34, 38 (S.D.N.Y. 2009) (“[A] notice of deposition . . .
constitutes the minimum, not the maximum, about which a deponent
must

be

prepared

to

speak.”

(second

alteration

in

original)

(internal quotation marks omitted)); see Alexander v. F.B.I., 186
F.R.D. 137, 140 (D.D.C. 1998) (finding Rule 30(b)(6) notice seeking
testimony about “computer system commonly known as or referred to
as ‘Big Brother’ and/or ‘WHODB’” sufficient since parties were well
aware of discoverable issues in case).
B.

Personal Knowledge Versus Corporate Knowledge

The defendants next claim that the plaintiff asked questions
only

about

Mr.

Scovello’s

personal

knowledge,

targeted toward GE’s knowledge on these topics.
9).

not

questions

(Def. Memo. at 7-

This argument is “nonsensical and groundless.”

Meyer Corp.

U.S., 2012 WL 3536987, at *9 (rejecting plaintiff’s argument that
by phrasing questions in “Do you know?” format, defendant was
seeking Rule 30(b)(6) designee’s personal knowledge, and noting

5

Pages 186 and 187 of Mr. Scovello’s deposition transcript
are attached as Exhibit 5 to the Reply Memorandum of Law in Support
of Plaintiff’s Motion to Compel FRCP 30(b)(6) Deposition Testimony
of Defendants General Electric Company and GE Micrgen, Inc. (“Reply
Memo.”).
10

“[t]his Court is aware of no cases where such an argument has been
accepted and, to the contrary, questions similar in form to those
complained of by plaintiff have been upheld in this Circuit.”).
“The ‘plain[]’ language of Rule 30(b)(6) ‘makes clear that a
designee is not simply testifying about matters within his or her
own personal knowledge, but is speaking for the corporation about
matters to which the corporation has reasonable access.’”

Great

American Insurance Co. of New York v. Summit Exterior Works, LLC,
No. 3:10 CV 1669, 2012 WL 459885, at *3 (D. Conn. Feb. 13, 2012)
(alteration in original) (quoting Rainey v. American Forest & Paper
Association, 26 F. Supp. 2d 82, 94 (D.D.C. 1998)); see also Krasney
v. Nationwide Mutual Insurance Co., No. 3:06 CV 1164, 2007 WL
4365677, at *2 (D. Conn. Dec. 11, 2007) (“The testimony elicited at
the Rule 30(b)(6) deposition represents the knowledge of the
corporation, not of the individual deponents.” (internal quotation
marks omitted)); Twentieth Century Fox Film Corp., 2002 WL 1835439,
at *3 (“The Rule 30(b)(6) designee does not give his personal
opinions.
topic.”

Rather he presents the corporation’s ‘position’ on the

(first

internal

quotation

marks

omitted)).

As

the

plaintiff points out, it never noticed the deposition of Mr.
Scovello personally, and consequentially Mr. Scovello did not
appear in his personal capacity at the deposition on December 10,
2012.

See Krasney, 2007 WL 4365677, at *2 (“‘The [Rule 30(b)(6)]
11

witness is speaking for the corporation, and this testimony must be
distinguished

from

that

of

a

mere

corporate

employee

whose

deposition is not considered that of the corporation and whose
presence must be obtained by subpoena.’” (quoting United States v.
Taylor, 166 F.R.D. 356, 361 (M.D.N.C. 1996)); accord Twentieth
Century Fox Film Corp., 2002 WL 1835439, at *2; cf. Parrot, Inc. v.
Nicestuff Distributing International, Inc., No. 06-61231, 2009 WL
197979, at *7 (S.D. Fla. Jan. 26, 2009) (“To depose the corporate
representative in his own capacity, the deposing party must notice
the deposition of the corporate representative in his personal
capacity.”).

Accordingly, Mr. Scovello testified on behalf of GE

and GE Microgen, not in his personal capacity.
C.

Documents Provided

Finally, the defendants contend that because they produced
Plug Power’s Board meeting minutes and GE’s 2003 due diligence
review, no additional witness testimony is necessary.
at 9-10).

(Def. Memo.

Soroof claims that the documents produced in discovery

are insufficient.

It argues that the Board minutes are “mere

summaries” of the meetings and do not represent all the matters
that were considered by the Board including any additional actions
taken by GE as a result of the matters it learned as a Board
member.

(Reply Memo. at 9).

Further, it contends that the Board

minutes open many areas of inquiry that cannot be gleaned from the
12

documents themselves that are relevant to its claims. (Reply Memo.
at 9).
As explained in Dongguk University v. Yale University, 270
F.R.D. 70, 74 (D. Conn. 2010),
[a] party should not be prevented from questioning a live
corporate witness in a deposition setting just because the
topics proposed are similar to those contained in documents
provided or interrogatory questions answered.
When
information has already been provided in other forms, a
witness may still be useful to testify as to the
interpretation of papers, and any underlying factual
qualifiers of those documents (i.e. information which the
defendant knows but is not apparent on the face of the
documents).
(internal citations and quotation marks omitted); cf. Cipriani v.
Dick’s Sporting Goods, Inc., No. 3:12 CV 910, 2012 WL 5869818, at
*2 (D. Conn. Nov. 19, 2012) (noting that “‘[e]ven if the substance
of

the

information

testimony

given

by

ultimately
[the

provided

defendant]’s

mirrors
former

that

of

the

directors

and

employees, plaintiff still is entitled to tie down the definitive
positions of [the defendant] itself’” through a Rule 30(b)(6)
deposition).
In sum, the questions Mr. Scovello was unable to answer are
covered within Soroof’s deposition notice and are information
reasonably available to the defendants.

Even if Mr. Scovello did

“not have personal knowledge concerning the matters set out in the
deposition notice,” GE and GE Microgen were “‘obligated to prepare

13

[him] so that [he] may give knowledgeable answers.’”

Meyer Corp.

U.S., 2012 WL 3536987, at *8 (quoting Spanski Enterprise, Inc.,
2009 WL 3270794, at *3).

Here, Mr. Scovello’s preparation for the

deposition was limited to reviewing his previous deposition and
that

of

Gary

Mittleman,

Gerard

Conway,

and

Barry

Glickman;

reviewing the plaintiff’s interrogatories; reading some e-mail
exchanges between Soroof and GE; and meeting with defense counsel
twice.

(Scovello Dep. at 8-10).

He did not meet with anyone at GE

or GE Microgen to prepare for the deposition (Scovello Dep. at 9),
was not provided any of Plug Power’s Board documents to review
(Scovello

Dep.

at

85-86),

and

was

not

apprised

of

GE’s

due

diligence review or its decision not to make further equity
investments in Plug Power (Scovello Dep. at 184-85).

Accordingly,

the defendants shall produce another Rule 30(b)(6) witness or
properly prepare Mr. Scovello to testify about these topics within
two weeks of the date of this Order.

See Fab-Tech, Inc. v. E.I. Du

Pont De Nemours and Co., No. 104CV275, 2006 WL 3702753, at *2 (D.
Vt. Dec. 13, 2006) (“When a designee is unable to adequately
respond to certain relevant areas of inquiry, the designating party
has a duty to substitute an appropriate deponent.” (internal
quotation marks omitted)); Sony Electronics, Inc. v. Soundview
Technologies, Inc., 217 F.R.D. 104, 112 (D. Conn. 2002) (ordering
plaintiff to produce additional Rule 30(b)(6) witness when its
14

designee was unable to testify about topics included in deposition
notice).

Fact discovery is otherwise complete.
SO ORDERED.

JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE
Dated:

New York, New York
March 28, 2013

Copies mailed this date:

James R. Lynch, Esq.

Lynch Daskal Emery, LLP

264 West 40th Street

New York, New York 10018

Haig V. Kalbian, Esq.

Mary M. Baker, Esq.

Aaron W. Knights, Esq.

Kalbian Hagerty LLP

888 17th Street, N.W., Suite 1000

Washington, DC 20006

Thomas E. Healy, Esq.

Pino & Associates, LLP

50 Main Street

White Plains, New York 10606

Michael D. Fisse, Esq.

Jan Van Steenis, Esq.

John Dubreuil, Esq.

Daigle, Fisse & Kessenich PLC

P.O. Box 5350
Covington, LA 70434
Abigail K. Hemani, Esq.
Goodwin Procter, LLP
620 Eighth Avenue
New York, New York 10018

15

Dahlia S. Ferouh, Esq.

Natalie F. Langlois, Esq.

Lisa Lo Gerfo, Esq.

Lauren S. Kupersmith, Esq.

Goodwin Procter LLP

53 State Street, Exchange Place

Boston, MA 02109

16