Freedom's Path at Dayton v. Dayton Metropolitan Housing Authority
Filing
45
DECISION AND ENTRY- IT IS THEREFORE ORDERED THAT: 1. Defendants Motion for Protective Order (Doc. # 28 ) is denied; and 2. Plaintiffs Motion to Compel Discovery and Request for Attorneys Fees and Expenses (Doc. # 29 ) is granted, in part, and denied, in part.. Signed by Magistrate Judge Sharon L. Ovington on 6/13/18. (kma)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON
FREEDOM’S PATH AT DAYTON,
Plaintiff,
vs.
DAYTON METROPOLITAN
HOUSING AUTHORITY,
Defendant.
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Case No. 3:16-cv-466
District Judge Walter H. Rice
Magistrate Judge Sharon L. Ovington
DECISION AND ENTRY
I.
Introduction
Plaintiff Freedom’s Path at Dayton brings this action alleging Defendant Dayton
Metropolitan Housing Authority (DMHA) d/b/a Greater Dayton Premier Management
(GDPM) “blocked funding for and financing of 60 units of project-based funded
affordable housing for veterans …” in violation of the American with Disabilities Act of
1990, as amended, 42 U.S.C. § 12101, et seq., and the Fair Housing Act of 1968, as
amended, 42 U.S.C. § 3601, et seq.
This case is presently before the Court upon Defendant’s Motions for Protective
Orders (Doc. #s 27, 28), Plaintiff’s Responses in Opposition (Doc. #33, 34), Defendant’s
Reply (Doc. #35), Plaintiff’s Motion to Compel (Doc. #29), Defendant’s Response in
Opposition (Doc. #32), and Plaintiff’s Reply (Doc. #36).
II.
Background
To understand the parties’ discovery disputes requires a brief look into the history
of the case. Plaintiff’s goal is to use Veterans Affairs Supportive Housing (VASH)
project-based rental assistance to house veterans, most of whom are disabled, in a
development known as Freedom Path-Dayton VA on the VA Medical Center’s campus in
Dayton, Ohio. Id. at ¶s 25, 28. To reach this goal, Plaintiff needs Defendant’s support
“because only [Public Housing Authorities] such as GDPM may apply for a VASH
allocation.” Id. at ¶27.
On April 9, 2013, GDPM’s Interim Chief Executive Officer, Alphonzio Prude,
sent Defendant a letter extending GDPM’s “support for Plaintiff’s new development on
the campus of the VA Medical Center and committed thirty-three … project-based
vouchers.” Id. at ¶28. Plaintiff understands this as GDPM’s initial affirmative
commitment to support Plaintiff’s efforts to obtain VASH financing. (Doc. #6, PageID
#53, ¶29). But since this initial commitment, GDPM “has balked at providing continued
support to Plaintiff.” Id. at ¶30.
In December 2015, Plaintiff asked GDPM to apply for project-specific, projectbased VASH vouchers on Plaintiff’s behalf. Defendant declined to do so and, instead,
“proposed applying for VASH Project-Based Rental Assistance on behalf of itself….”
Id. at ¶s 31-32. “By applying for VASH [assistance] … on its own behalf … and by not
applying in a timely manner for Plaintiff’s specific, project-based VASH vouchers,
GDPM jeopardized HUD’s award of 25 points that would give Plaintiff enough points for
its project to be selected ….” Id. at ¶s 31-32. According to Plaintiff, Defendant GDPM
provided “various inconsistent, mistaken, or shifting rationales for its indecision….” Id.
at ¶33. Plaintiff alleges, for example, GDPM explained, in part, that Prude’s letter was
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inconsistent with federal law, and GDPM “has already exceeded its overall allocation of
vouchers (this in incorrect—a HUD VASH voucher waiver to the cap is available)[.]” Id.
On September 2, 2016, Plaintiff’s counsel sent a detailed letter to GDPM asking it
to apply to HUD on Plaintiff’s behalf for 60 VASH vouchers before the impending
September 9, 2016 deadline. Id. at ¶34 and Exhibit B, PageID #64. Plaintiff asked
Defendant to “[p]lease treat this as a request for reasonable accommodation under the
Fair Housing Amendments Act of 1988 and the Americans with Disabilities Act, and take
whatever steps necessary to accommodate our request....” Id. Plaintiff asserts that
GDPM denied the requested accommodation. (Doc. #6, PageID #54, ¶34).
Plaintiff seeks (1) declaratory relief concluding that GDPM violated the FHA and
ADA; (2) an Order mandating GDPM to apply to HUD on Plaintiff’s behalf for VASH
project-based rental assistance or, alternatively, to grant Plaintiff a reasonable
accommodation; (3) preliminary and permanent injunctions prohibiting GDPM from
violating the ADA and FHA; and damages “for the harm it experienced as a result of
GDPM’s discriminatory and dilatory practices.” Id. at ¶60.
III.
Standard of Review
Under the Federal Rules of Civil Procedure, the scope of discovery is
“traditionally quite broad.” Lewis v. ACB Bus. Servs, Inc., 135 F.3d 389, 402 (6th Cir.
1998) (citing Mellon v. Cooper–Jarrett, Inc., 424 F.2d 499, 501 (6th Cir. 1970)).
Parties may obtain discovery regarding any nonprivileged
matter that is relevant to any party’s claim or defense and
proportional to the needs of the case, considering the
importance of the issues at stake in the action, the amount in
controversy, the parties’ relative access to relevant
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information, the parties’ resources, the importance of the
discovery in resolving the issues, and whether the burden or
expense of the proposed discovery outweighs its likely benefit.
Information within this scope of discovery need not be
admissible in evidence to be discoverable.
Fed. R. Civ. P. 26(b)(1). But, “this desire to allow broad discovery is not without limits
and the trial court is given wide discretion in balancing the needs and rights of both
plaintiff and defendant.” Scales v. J.C. Bradford & Co., 925 F.2d 901, 906 (6th Cir.
1991).
A party may file a motion to compel discovery when a deponent fails to answer a
question under Rules 30 or 31. Fed. R. Civ. P. 37(a)(3)(B). “[T]he proponent of a
motion to compel discovery bears the initial burden of proving that the information
sought is relevant.” Mayer v. Allstate Vehicle & Prop. Ins. Co., No. 2:15-cv-2896, 2016
WL 1632415, at *2 (S.D. Ohio Apr. 22, 2016) (Deavers, M.J.), objections overruled,
2016 WL 2726658 (S.D. Ohio May 10, 2016) (Marbley, D.J.) (quoting Guinn v. Mount
Carmel Health Sys., No. 2:09-cv-226, 2010 WL 2927254, at *5 (S.D. Ohio July 23,
2010) (Kemp, M.J.); Clumm v. Manes, No. 2:08-cv-567 (S.D. Ohio May 27, 2010) (King,
M.J.)); see also United States ex rel. Shamesh v. CA, Inc., 314 F.R.D. 1, 8 (D.D.C. 2016)
(“In cases where a relevancy objection has been raised, the party seeking discovery must
demonstrate that the information sought to be compelled is within the scope of
discoverable information under Rule 26.”). If the proponent meets its initial burden, then
“the party resisting production has the burden of establishing that the information is
either not relevant or is so marginally relevant that the presumption of broad disclosure is
outweighed by the potential for undue burden or harm.” Pillar Title Agency v. Pei, No.
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2:14-cv-525, 2015 WL 2238180, at *3 (S.D. Ohio May 12, 2015) (Kemp, M.J.) (citing
Vickers v. Gen. Motors Corp., No. 07-2172 M1/P, 2008 WL 4600997, at *2 (W.D. Tenn.
Sept. 29, 2008)).
When a party seeks to limit discovery, it may file a motion for protective order.
Federal Rule of Civil Procedure 26(c) provides that a “court may, for good cause, issue
an order to protect a party or person from annoyance, embarrassment, oppression, or
undue burden or expense ….” “To justify restricting discovery, the harassment or
oppression should be unreasonable, but discovery has limits and ... these limits grow
more formidable as the showing of need decreases.” Serrano v. Cintas Corp., 699 F.3d
884, 901 (6th Cir. 2012) (quoting 8A CHARLES ALAN WRIGHT & ARTHUR R.
MILLER ET AL., FEDERAL PRACTICE AND PROCEDURE § 2036 (3d ed. 2012))
(internal quotation marks omitted). To prevail on a motion for protective order, the party
must “show that the requested discovery does not fall within Rule 26(b)(1)’s scope of
relevance (as now amended) or that a discovery request would impose an undue burden
or expense or is otherwise objectionable.” Bros. Trading Co. v. Goodman Factors, No.
1:14-CV-975, 2016 WL 9781140, at *2 (S.D. Ohio Mar. 2, 2016) (Litkovitz, M.J.)
(quoting Mckinney/Pearl Rest. Partners, L.P., 322 F.R.D. 235, 242) (N.D. Tex. 2016)).
IV.
Discussion
A.
Protective Orders
Defendant DMHA filed two motions for protective orders barring the depositions
of five individuals. In its first motion, Defendant DMHA sought a protective order
barring the deposition of its former interim CEO, Jeff Rieck. (Doc. #27). District Judge
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Walter H. Rice overruled Defendant’s Motion for Protective Order Barring the
Deposition of Jeff Rieck (Doc. #27) as moot.
In its second motion for protective order, Defendant DMHA seeks to bar the
depositions of third-party witnesses Alphonzio Prude, De Carol Smith, Phyllis
Smelkinson, and Raymond Keyser. Defendant asserts that (1) the depositions are
irrelevant to any claim or defense; (2) the depositions would subject DMHA to severe
undue burden and expense; and (3) none of the depositions meet the proportionality
requirement of Rule 26(b)(1). (Doc. #28).
i.
Relevance under Rule 26(b)(2)
Defendant asserts that the deposition of Mr. Prude—a former interim CEO of
DMHA—is “largely irrelevant” because his “only involvement in the events giving rise
to Plaintiff’s lawsuit pertains to the letter that Prude authored in his capacity as interim
CEO of DMHA in April 2013 expressing the agency’s purported support for Plaintiff’s
request for vouchers for its housing project.” (Doc. #28, PageID #227). Defendant
claims to be “categorically barred [from] satisfying Plaintiff’s reasonable accommodation
request through use of the Prude letter as a matter of law.” Id. at 228. The law
Defendant refers to is 24 C.F.R. § 983.51. And, this requires some additional
information: Under 24 C.F.R. § 983.51(b), there are two methods by which a public
housing authority (PHA) can select project-based voucher (PBV) proposals: (1) request
PVB proposals; or (2) rely on previous competition. A public housing authority—such as
Defendant in the present case—must have an administrative plan that describes “the
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procedures for owner submission of PBV proposals and for PHA selection of PBV
proposals.” Id. § 983.51(a).
Defendant asserts that its administrative plan indicates it may only select projectbased voucher proposals using the first method. (Doc. #28, PageID #s 228, 253-56).
Thus, according to Defendant, because “Plaintiff’s attempt to utilize Prude’s letter to
obtain vouchers for its housing project involved the issuance of vouchers through the
second method …,” and “because awarding Plaintiff housing vouchers through the use of
the Prude letter would have violated federal HUD regulations, it is beyond dispute that
the letter is completely irrelevant to Plaintiff’s sole claim in this case that DMHA
improperly refused to satisfy Plaintiff’s accommodation request.” Id. at 229.
Plaintiff asserts that this is merely one of Defendant’s “various inconsistent,
mistaken, or shifting rationales for its inactions.” (Doc. #33, PageID #710). Plaintiff
argues that, because Defendant’s administrative plan requires Defendant to comply with
all HUD regulations and HUD regulations allow two methods of selection of PBV
proposals, Defendant could rely on the second method for selecting PBV proposals. And,
because Plaintiff’s previous competitive processes satisfy this second method, awarding
Plaintiff housing vouchers through Mr. Prude’s letter would not violate HUD regulations.
Further, if Defendant could not—under its administrative plan at that time—select
Plaintiff’s PVB proposal, Defendant could amend its administrative plan. And, indeed,
Defendant did. In October 2016, Defendant’s Board approved changes to its
administrative plan to include the second method for selecting PBV proposals. (Doc.
#29, PageID #304). HUD approved the changes in April 2017. Id.
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Plaintiff alleges that through Mr. Prude’s letter, Defendant “extended its support
for Plaintiff’s new development on the campus of the VA Medical Center and committed
thirty-three (33) project-based vouchers.” (Doc. #6, PageID #53). This commitment is
at the heart of Plaintiff’s claims. And, Mr. Prude, as Defendant’s interim CEO at the time
of this commitment, likely has relevant and thus discoverable information about
Plaintiff’s claims.
Defendant contends that the deposition of Ms. Smith—an Enhanced Use Lease
Project Manager at the United States Department of Veterans Affairs—is “largely
irrelevant.” Id. at 227. Ms. Smith’s “involvement in the events giving rise to this lawsuit
is limited to her correspondence with DMHA and Plaintiff’s representatives regarding the
status of DMHA’s response to Plaintiff’s accommodation request.” Id. But, Defendant
argues, “any testimony provided by Smith regarding her conversations and interactions
with DMHA would constitute inadmissible hearsay, and as such cannot … be used to
support either of the causes of action asserted by Plaintiff against DMHA in this action.”
Id.
Given Defendant’s assertion that “Plaintiff’s sole claim in this case” is “that
DMHA improperly refused to satisfy Plaintiff’s accommodation request,” the deposition
of Ms. Smith—who, as Defendant claims, was involved with Plaintiff’s accommodation
request—seeks information relevant to Plaintiff’s claim. Defendant’s argument that Ms.
Smith’s testimony is not relevant because it would constitute inadmissible hearsay lacks
merit for discovery purposes: “Information within this scope of discovery need not be
admissible in evidence to be discoverable.” Fed. R. Civ. P 26(b)(1).
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Defendant asserts that depositions of Ms. Smelkinson—a Housing Program
Specialist at HUD—and Mr. Keyser—General Counsel for HUD—“must be barred due
to these two individuals’ lack of personal knowledge regarding any facts underlying the
[present] lawsuit.” (Doc. #28, PageID #s 223, 226). Defendant insists that neither was
“involved in any of the events giving rise to Plaintiff’s action relating to Plaintiff’s
accommodation request for an award of vouchers for Plaintiff’s housing complex, or
DMHA’s handling of and response to Plaintiff’s accommodation request.” Id. at 226.
Plaintiff alleges that Ms. Smith consulted Ms. Smelkinson on whether Plaintiff
was disqualified from the HUD VASH NOFA (notice of finding availability) process. Id.
And, Ms. Smelkinson “reportedly told the VA VASH person, De Carol Smith, that,
contrary to Defendant’s assertion, Plaintiff was eligible to partner with Defendant in the
NOFA. (Doc. #33, PageID #715).
Likewise, Ms. Heapy—the current CEO of Defendant DMHA—stated that Mr.
Keyser, HUD general counsel, agreed with the opinion of Gordon Black, a low-level
HUD official, who said that she could not “‘honor’ the original commitment of 33
vouchers to Plaintiff ‘without going through the necessary RFP [competitive] process.”
Id at 713-15 (citation omitted); see Doc. #29, PageID #317. But, according to Plaintiff,
its attorney, Orlando Cabrera, spoke to Mr. Keyser, and he “said that there were a number
of ways that DMHA could partner with Plaintiff, including amending its Administrative
Plan.” Id. at 714. As explained above, “DMHA’s Administrative Plan was amended by
its Board in October or early November of 2016, and approved by HUD in April 2017 to
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specifically include selection based on previous competition ….” Id. at 714, n. 4 (citing
Heapy Depo. Tr. At 107-08).
In other words, Ms. Smelkinson and Mr. Keyser were allegedly involved—to
some degree—in the facts giving rise to the present lawsuit. And, Plaintiff asserts, Ms.
Smith, Ms. Smelkinson, and Mr. Black all possess information regarding whether
Defendant could lawfully honor its initial commitment of thirty-three project-based
vouchers and/or whether Defendant could lawfully grant Plaintiff’s request for reasonable
accommodation. Therefore, their depositions search for relevant and discoverable
information about Plaintiff’s claims.
Further, Plaintiff alleges that “[t]he historical background of [Defendant’s]
actions, the sequence of events, [Defendant’s] departures from the normal procedural
sequence or substantive criteria all reflect intent to discriminate.” (Doc. #6, PageID
#54). Accordingly, the background—including Mr. Prude’s initial commitment letter,
Defendant’s and Plaintiff’s consultation with HUD employees, and HUD employee’s
discussions with VA employees—might or might not shed light on the merits of
Plaintiff’s claims. Consequently, the information Plaintiff seeks by deposing Mr. Prude,
Ms. Smith, Ms. Smelkinson, and Mr. Keyser is discoverable
ii.
Proportionality
Under Federal Rule of Civil Procedure 26(b)(1), discovery must be “proportional
to the needs of the case, considering the importance of the issues at stake in the action,
the amount in controversy, the parties’ relative access to relevant information, the parties’
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resources, the importance of the discovery in resolving the issues, and whether the burden
or expense of the proposed discovery outweighs its likely benefit.”
Importance of the Issues at Stake
Plaintiff correctly asserts that the issues at stake in the present case are important:
“They involve housing for homeless veterans, many of whom are disabled due to their
service to this country. This case implicates important national policies about eradicating
homelessness, especially for veterans, and providing permanent housing for them as
proposed by Plaintiff.” (Doc. #33, PageID #716). Defendant does not argue to the
contrary.
Amount in Controversy
Plaintiff validly contends that the amount-in-controversy factor weighs in its
favor. “Plaintiff’s damages expert opines that DMHA’s actions caused Plaintiff, and
more importantly the veterans, to lose more than $15,000,000 in lost housing and overlay
services.” Id. Defendant does not suggest otherwise.
Parties’ Relative Access to Relevant Information
It is likely that Defendant has, or has access to, most or all of the information
Plaintiff seeks. Thus, this factor falls in Plaintiff’s favor.
Parties’ Resources
Defendant contends that the parties’-resources factor weighs in favor of barring
the depositions. “DMHA is a public housing agency funded solely by taxpayer dollars.
Thus, DMHA has limited resources as it relates to defending against Plaintiff’s claims in
this case, as each dollar spent on defending this meritless action is a dollar that cannot be
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put toward providing affordable housing to the residents of Dayton.” (Doc. #28, PageID
#233).
Plaintiff contends that the parties’ resources are the same. “Defendant is being
defended by an insurance defense firm and has millions of dollars in potential coverage.
Its annual budget is $45,000,000.” (Doc. #33, PageID #716) (citing Heapy Depo. Tr. at
10).
Without additional information about the parties’ resources—which the record
presently lacks—this factor favors neither party.
Importance of the Discovery in Resolving the Issues
Defendants argue that none of the depositions “are in any way necessary or
otherwise important to resolving the sole dispute at issue in this lawsuit - whether DMHA
improperly declined to satisfy Plaintiff's accommodation request regarding the issuance
of vouchers for its housing complex.” (Doc. #28, PageID #233).
Plaintiff disagrees, asserting, “The discovery is necessary for Plaintiff’s
anticipated summary judgment motion. The witnesses all have important information
that is directly relevant to whether Defendant improperly employed shifting rationales for
denying Plaintiff’s request for housing vouchers.” (Doc. #33, PageID #s 716-17).
As explained in greater detail above, these four individuals were involved with the
events underlying Plaintiff’s claims and likely have information regarding whether
Defendant improperly employed shifting rationales for denying Plaintiff’s request for the
housing vouchers.
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Whether the Burden or Expense of the Proposed
Discovery Outweighs Its Likely Benefit
Defendant argues that “all four depositions would subject DMHA to severe undue
burden and expense.” (Doc. #28, PageID #230). According to Defendant, the distant
depositions of Ms. Smith and Ms. Smelkinson (in Washington, D.C.), Mr. Prude (in
Michigan), and Mr. Keyser (in Cleveland) “would force [Defendant] to incur both air [or
other] travel and overnight lodging expenses ….” Id. at 231. In addition, Defendant
“would incur substantial additional litigation expenses in having to prepare for and attend
these depositions, none of which will produce any tangible benefit for either of the parties
involved in this action.” Id. Defendant asserts that Plaintiff will receive “little—if any—
benefit” because the witnesses “possess scant knowledge of facts or evidence that would
assist Plaintiff ….” Id. at 232.
Plaintiff insists, however, that Defendant’s “counsel is located in Cincinnati,
which has regular non-stop service to the Washington, D.C. area where Smelkinson and
Smith are located.” (Doc. #33, PageID #715). It also has frequent non-stop flights to
Cleveland, where Mr. Keyser is located, and to Chicago, near where Plaintiff intends to
depose Mr. Prude. Id. at 715-16.
Plaintiff notes that it scheduled the depositions of Mr. Keyser and Gordon Black, a
low-level HUD official, on the same day in Cleveland. Id. at 717, n.6. Defendant did not
seek a protective order barring the deposition of Mr. Black. Id. And, if Defendant had
agreed to the deposition of Mr. Keyser on the same day as Mr. Black, Defendant would
not have incurred significant additional expenses.
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Defendant bears the burden of establishing good cause for a protective order. Nix
v. Sword, 11 F. App’x 498, 500 (6th Cir. 2001). “To show good cause, a movant for a
protective order must articulate specific facts showing clearly defined and serious injury
resulting from the discovery sought and cannot rely on mere conclusory statements.” Id.
(quoting Avirgan v. Hull, 118 F.R.D. 252, 254 (D.D.C. 1987)) (internal quotation marks
omitted); see Fed. R. Civ. P 26(b)(1) advisory committee’s note (2015) (“A party
claiming undue burden or expense ordinarily has far better information—perhaps the
only information—with respect to that part of the determination.”). Defendant’s broad
allegations of “significant travel expenses” and “substantial additional litigation
expenses” suffice to show it will suffer undue burden or expense and do not establish
good cause for a protective order.
In sum, the balancing of these factors weighs in favor of allowing the depositions
of Mr. Prude, Ms. Smith, Ms. Smelkinson, and Mr. Keyser. Additionally, Plaintiff has
shown that it seeks information from their depositions that is relevant to its claims and
proportional to the needs of the case. Accordingly, Defendant’s Motion for Protective
Order is denied.
B.
Motion to Compel
Plaintiff’s Motion to Compel Discovery and Request for Attorneys’ Fees and
Expenses asks the Court for an order compelling Ms. Heapy’s deposition testimony and
admonishing defense counsel to refrain from speaking and coaching objections,
instructing witnesses not to answer questions, and making baseless objections. (Doc.
#29).
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Under Federal Rule of Civil Procedure 30, “An objection at the time of the
examination--whether to evidence, to a party’s conduct, to the officer’s qualifications, to
the manner of taking the deposition, or to any other aspect of the deposition--must be
noted on the record, but the examination still proceeds; the testimony is taken subject to
any objection. An objection must be stated concisely in a nonargumentative and
nonsuggestive manner. A person may instruct a deponent not to answer only when
necessary to preserve a privilege, to enforce a limitation ordered by the court, or to
present a motion under Rule 30(d)(3).”
i.
Mr. Freudiger’s Objections
Plaintiff asserts, “Mr. Freudiger made at least 17 other speaking objections that
suggested to his client how to answer questions.” (Doc. #29, PageID #259) (citations
omitted). Further, “In 20+ instances, Mr. Freudiger instructed Ms. Heapy not to answer
even though no claim of privilege had been raised or was implicated.” Id. at 262
(citations omitted).
Plaintiff asserts that opposing counsel’s statements such as “if you can” or “if you
know” are suggestive and, therefore, in violation of Rule 30. For example, after noting
his objection, Mr. Freudiger instructed Ms. Heapy to respond:
Q. Does the Americans with Disabilities Act apply to your
policies and actions?
MR. FREUDIGER: Objection. You can answer if you know.
THE WITNESS: That’s a legal determination. I don’t know.
Id. at 314 (emphasis added).
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Defendant disagrees: “this statement merely patterns the extremely common
principal followed almost uniformly by all litigants in both state and federal court that
deponents should not guess or speculate as to their deposition answers.” (Doc. #32,
PageID #681).
This is why astute counsel prepares witnesses—before depositions begin—to
testify about their personal knowledge rather than to guess or speculate. Defendant is
correct that deponents should not guess or speculate as to their deposition answers.
Nevertheless, assuming this practice is widespread in state and federal courts, there is no
valid reason why Defendant’s counsel would need to repeatedly interrupt the deposition
questioning of any individual—here, Ms. Heapy—who has been an attorney for nearly
fifteen years. Indeed, at a minimum, Defendant’s “counsel would do well to avoid using
this phrasing in the future, as it can plausibly be[] seen as coaching [the] witness. It is the
attorney’s job to make an objection and then stop talking. If the deponent does not know
how to answer a question, he or she may state as much, but it is not appropriate for his or
her attorney to push him or her in that direction.” Pogue v. NorthWestern Mut. Life Ins.
Co., No. 3:14-CV-598-CRS, 2017 WL 3044763, at *11 (W.D. Ky. July 18, 2017).
Plaintiff also points to multiple instances where Mr. Freudiger objected and then
suggested a response.
Q. So would it be fair to say … that there would be minutes
… of the meeting where Mr. Prude was terminated, but
that those may or may not be available under the public
record law depending upon whether the meeting was
open or closed?
MR. FREUDIGER: Yeah, I have to object. I don’t think she’s
going to know that.
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MR. GREEN: Well, I’m asking her a question. It’s not for
you to testify.
MR. FREUDIGER: Well, it’s beyond the purview of the
topics. You’re asking a question that probably needs to
be asked of her general counsel. She is hired by the
board. You can answer if you know. If you do not
know, then say you do not know.
THE WITNESS: Can you repeat the question?
(Record read.)
THE WITNESS: I do not know the answer to that.
(Doc. #29, PageID #327) (emphasis added). Rather than allowing Ms. Heapy to respond
to—or ask for clarification of—Mr. Green’s questions, Mr. Freudiger expressed his own
opinions:
Q. What part of the regulations did Orlando Cabrera say that
you could ignore?
A. He didn’t specifically state which ones could be -- what he
said was as long as the administrative plan says just a
blanket statement that you will comply with all HUD
rules and regulations, that we didn’t have to follow
what was in our administrative plan.
Q. Is that because the HUD regulations trumped your
administrative plan?
MR. FREUDIGER: Objection.
BY MR. GREEN:
Q. Is that because the HUD regulations controlled your
administrative plan?
MR. FREUDIGER: Objection, vague. It’s not clear whether
you’re talking about whether Cabrera said that or
you’re asking for her legal opinion.
Id. at 324 (emphasis added). Mr. Freudiger’s comments are improper under Rule
30(c)(2). See Little Hocking Water Ass’n, Inc. v. E.I. Du Pont de Nemours & Co., No.
2:09-CV-1081, 2013 WL 6632678, at *15 (S.D. Ohio Dec. 17, 2013) (“The Court
strongly disapproves of defense counsel’s efforts to interject [defendant] positions into
the course of plaintiff’s deposition inquiry. Certainly, [defendant] has a right to attempt
17
to clarify the witness’ testimony, if it perceives a need to do so, but that attempt must
await the completion of plaintiff’s inquiry.); Cullen v. Nissan N. Am., Inc., No. 3-090180, 2010 WL 11579750, at *6 (M.D. Tenn. Feb. 2, 2010) (“[I]t is not proper for
counsel for the deponent to ask the deposing attorney to clarify the question; that is the
responsibility of the deponent.”).
Notably, during Ms. Heapy’s deposition, Mr. Freudiger declared, “I can instruct
my witness. Speaking objections -- we all know what the federal rules say. I have been
less vocal than you were. So I’m permitted to instruct the witness whether she can
answer or not.” (Doc. #29, PageID #286) (emphasis added). And shortly thereafter, “I
have a right to tell my witness that she can answer a question.” Id.
Mr. Freudiger’s interpretation of “what the federal rules say” is incorrect. He does
not have the right to tell his witness that she can answer a question. Indeed, all he can do
is state a concise, nonargumentative, and nonsuggestive objection on the record and
instruct his witness not to answer in the limited circumstances laid out in Rule 30(c)(2).
See Montiel v. Taylor, No. 3:09-CV-489, 2011 WL 1532529, at *3 (E.D. Tenn. Apr. 21,
2011) (“Rule 30(c)(2) allows non-examining counsel at a deposition to do one of two
things: (1) listen and (2) make objections.”).
ii.
The CEOs Prior to Ms. Heapy
Plaintiff asserts that Defendant’s counsel improperly instructed Ms. Heapy not to
respond to questions about Mr. Prude’s application for unemployment. (Doc. #29,
PageID# 264). On March 23, 2018 (after Ms. Heapy’s deposition), at Plaintiff’s request,
the Court held an informal telephone conference regarding, in part, the termination of
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Alphonzio Prude’s employment with Defendant. Plaintiff reported that, although
Defendant provided Mr. Prude’s employee file, his file did not include Defendant’s
response to Mr. Prude’s application for unemployment. This Court found that this
evidence was relevant, therefore discoverable, and directed Defendant to investigate
whether there was a response to Mr. Prude’s application and, if there was, produce it. If
Defendant could not produce the response, then Defendant must certify that it could not
be located. It appears that Defendant failed to follow the Court’s instruction.
Accordingly, Defendant must, within one week of this Order, produce its response
to Mr. Prude’s application for unemployment.
Plaintiff also notes that Mr. Freudiger—objecting on the basis of “pending
litigation”—instructed Ms. Heapy not to answer questions about why Danielle Wright
and Jeff Rieck, former CEOs, left DMHA.
Defendant does not suggest that “pending litigation” is a valid ground for
instructing a deponent not to answer. Instead, Defendant insists that Plaintiff’s questions
were “wholly improper” because Ms. Wright and Mr. Rieck’s prior employment are
“wholly irrelevant” to the present case. (Doc. #32, PageID #s 689-90). Defendant’s
argument misses the mark: Rule 30(c)(2) requires a deponent to continue her testimony
over objection unless she has asserted a privilege, is enforcing a limitation ordered by the
court, or to present a motion under Rule 30(d)(3). “Objecting on the basis of relevance
does not constitute one of these exceptions.” Grider v. City of Russell Springs, No. 1:05CV-137, 2010 WL 4683748, at *2 (W.D. Ky. Nov. 12, 2010).
Accordingly, Plaintiff is permitted to send written deposition questions to Ms.
19
Heapy to which she must respond within two weeks after she receives them.
iii.
Defendant’s Administrative Plan and HUD Regulations
Next, Plaintiff asserts that Defendant’s counsel improperly objected to questions
concerning Defendant’s Administrative Plan and HUD regulations. On several
occasions, Mr. Freudiger objected and instructed Ms. Heapy not to respond on the
grounds that the question called for a legal conclusion or for her to interpret law.
BY MR. GREEN:
Q. Is there any HUD authority or rule that requires an
expiration date for the … April 9th, 2013, commitment
vouchers?
MR. FREUDIGER: Again, objection, legal conclusion,
beyond the scope of the topic for the 30(b)(6). She can’t
answer that.
BY MR. GREEN:
Q. Are you aware of any HUD authority or HUD rule that
requires an expiration date for Mr. Prude’s 2013 letter
committing to 33 units of PBRA?
MR. FREUDIGER: Same objection, same instruction.
(Doc. #29, PageID# 317) (emphasis added).
Mr. Freudiger stopped her from answering questions as the Rule 30(b)(6) designee
or as an individual.
Q. Would you agree as CEO that your organization is required
to interpret your administrative plan consistently with
HUD regulations?
MR. FREUDIGER: Objection, legal conclusion, beyond the
scope of the notice of taking 30(b)(6).
MR. GREEN: I’m asking her as an individual.
MR. FREUDIGER: Well, she cannot give a legal opinion as an
individual.
BY MR. GREEN:
Q. As a member of management, do you agree that you need
to interpret your administrative plan consistently with
HUD regulations?
20
MR. FREUDIGER: Objection.
MR. GREEN: Go ahead and answer.
THE WITNESS: Can you repeat the question again?
(Record read.)
THE WITNESS: We have to write our administrative plan
taking into consideration the regulations.
BY MR. GREEN:
Q. Okay. I asked you the question are you required to interpret
your administrative plan consistently with federal
regulations?
MR. FREUDIGER: Well, she answered to the best of her
ability, and you’re asking her if she is required to
interpret -MR. GREEN: No.
MR. FREUDIGER: -- or if GDPM is required to interpret, so I
don’t think she can answer that question.
MR. GREEN: She said she was required to write the
administrative plan.
MR. FREUDIGER: I know what she said, but she’s not going
to answer your next question.
MR. GREEN: Okay. So you’re directing her not to answer the
last question about interpretation?
MR. FREUDIGER: Yeah.
MR. GREEN: Okay.
Id. at 324-25. And he stopped some questions without providing a reason:
Q. Okay. As CEO of GDPM, is it your understanding that
federal law trumps state and local law?
MR. FREUDIGER: Objection. That is still a legal conclusion
and beyond the scope of the 30(b)(6).
MR. GREEN: It’s entirely within the scope.
MR. FREUDIGER: No, it’s not.
MR. GREEN: I asked her for the reasons, and she stated that
the administrative plan did not provide for something
that HUD regulations provided for, so I’m trying to
explore that.
MR. FREUDIGER: Your topic said the factual basis for the
refusal. So obviously she can testify to the reasons that
she gave your client as to her understanding. But you
asked her a general question about whether federal law
trumps state law. That’s entirely outside the scope of
your topic or the reasons that she has ever given.
21
MR. GREEN: Okay.
MR. FREUDIGER: So she can’t answer that.
MR. GREEN: She can answer that as an individual.
BY MR. GREEN:
Q. You’re a lawyer, correct?
MR. FREUDIGER: No, we’re not going there. We’re not
going there.
MR. GREEN: So you’re instructing her not to answer as an
individual who is also a lawyer; is that correct?
MR. FREUDIGER: Well, I’m instructing her to … not answer,
period. I don’t have to give you my reasons. She is not
answering it.
MR. GREEN: Okay.
Id. at 309-10 (emphasis added).
On at least one occasion, Mr. Freudiger answered the question himself:
[MR. GREEN:]
Q. And if HUD regulations specifically allow … that
Freedom’s Path could qualify for the PBV under (b)(2), that
would allow your agency to … treat them as being qualified,
correct?
MR. FREUDIGER: No.
THE WITNESS: No.
MR. FREUDIGER: Objection. She cannot answer that
question. You’re asking her to interpret the regulations.
Id. at 302-03 (emphasis added).
The Rule is clear: “An objection … must be noted on the record, but the
examination still proceeds; the testimony is taken subject to any objection…. A person
may instruct a deponent not to answer only when necessary to preserve a privilege, to
enforce a limitation ordered by the court, or to present a motion under Rule 30(d)(3).”
Fed. R. Civ. P. 30. There is no indication from Defendant that any of the exceptions
apply. Accordingly, it was improper for Mr. Freudiger to instruct Ms. Heapy not to
answer questions on the ground that it called for a legal conclusion.
22
iv.
Ms. Heapy’s Failure to Prepare as a Rule 30(b)(6) Designee
Under Federal Rule of Civil Procedure 30(b)(6), “a party may name as the
deponent a ... corporation ... and must describe with reasonable particularity the matters
for examination. The named organization must then designate one or more ... persons
who consent to testify on its behalf …. The persons designated must testify about
information known or reasonably available to the organization.” See Rivet v. State Farm
Mut. Auto. Ins. Co., 316 F. App’x 440, 447 (6th Cir. 2009). “A Rule 30(b)(6) deponent
testifies as to the knowledge of the corporation and the corporations’ subjective beliefs
and opinions and interpretation of documents and events.” Buck v. Ford Motor Co., No.
3:08CV998, 2012 WL 601922, at *3 (N.D. Ohio Feb. 23, 2012) (quoting Hilton Hotels
Corp. v. Dunnet, 2002 WL 1482543, *2 (W.D. Tenn. 2002)) (quotation marks omitted).
The corporation has a duty to prepare the witness to answer all questions about the
designated topics fully and without evasion. U.S., ex rel. Fry v. Health All. of Greater
Cincinnati, No. 1:03-CV-167, 2009 WL 5227661, at *2 (S.D. Ohio Nov. 20, 2009)
(citing Great American Ins. Co. v. Vegas Constr. Co., Inc., No. 2:06-cv-911, 251 F.R.D.
534, 539 (D.Nev. March 24, 2008) (“Counsel has the responsibility to prepare its
designee to the extent matters are reasonably available, whether from documents, past
employees, or other sources.”).
Plaintiff contends that Ms. Heapy failed to adequately prepare as the Rule 30(b)(6)
designee. Specifically, she “failed to look for records concerning the reasons for
terminating the employment of former Interim CEO, Alphonzio Prude. She conducted no
23
written review of documentation as to the reasons for the termination. She spoke with
only one member of her board.” (Doc. #29, PageID #268) (internal citations omitted).
Ms. Heapy testified that, in preparation for her deposition, she spoke to one board
member about Mr. Prude’s termination and reviewed Mr. Prude’s personnel file. Id. at
283-84. His file did not contain a record of the reasons for his termination. Id. Ms.
Heapy did not, however, review Mr. Prude’s “benefits file” because she does not consider
it to be part of a personnel matter. Id. at 285.
When asked about “how Mr. Prude came to be terminated,” she explained, “He
was placed on administrative leave in November and was ultimately fired that following
month.” Id. Ms. Heapy did not know if he was given reasons why he was placed on
administrative leave and she did not ask anyone. Id. She testified that she believed there
was a board meeting when Mr. Prude was terminated but she was not at the meeting and
she did not remember whether it was an open or closed meeting. Id. at 288. Ms. Heapy
knew, based on her previous discussions with the board of directors and general counsel,
that Mr. Prude “was fired by our Board of Commissioners for his lack of ability to
maintain compliance of the agency and to work within the rules and regulations laid out
by HUD. He also settled a lawsuit without consulting the board.” Id. at 282, 284. The
areas of non-compliance included their public records policy and their violence against
women policy. Id. at 282. The lawsuit involved an employment issue brought by Karen
Boneski. Id. at 283. Ms. Heapy did not know “the specific allegations”; the settlement
amount; or if Mr. Prude was named individually. Id. She knew that there were no
allegations of sexual harassment or issues with violence against women. Id.
24
When asked if she knew that Mr. Prude applied for unemployment compensation,
she replied, “I believe he did.” Id. at 284. However, Ms. Heapy did not know what
position DMHA took regarding his application and stated that she did not ask anyone. Id.
At that point, Mr. Freudiger objected, contending
That’s beyond the scope of the topics. She was asked
for the personnel and disciplinary reasons and the reasons for
his separation discharge or termination. There’s nothing in
here about DMHA’s position in his request for
unemployment, and it’s totally outside the bounds of any kind
of relevancy whatsoever, so she won’t be answering any
questions on that.
Id. at 284.
Mr. Freudiger, however, is not correct on either assertion. Plaintiff’s list of Rule
30(b)(6) topics includes “The personnel and disciplinary records of Alphonzio Prude.”
Id. at 276. It is reasonable to think that his application for unemployment and any
response by Defendant would be included in Mr. Prude’s personnel file. Further, as
explained above, DMHA’s response is relevant and Defendant must produce a copy of its
response to Mr. Prude’s application for unemployment compensation or a sworn affidavit
stating that it cannot be located.
Although Ms. Heapy could not answer every question concerning Mr. Prude’s
termination, “the inability of a designee to answer every question on a particular topic
does not necessarily mean that the corporation has failed to comply with its obligations
under the Rule.” Pogue v. NorthWestern Mut. Life Ins. Co., No. 3:14-CV-598-CRS,
2017 WL 3044763, at *8 (W.D. Ky. July 18, 2017) (citing Janko Enters. v. Long John
Silver’s, Inc., 2014 U.S. Dist. LEXIS 185334, *14, 2014 WL 11152378 (W.D. Ky. Apr.
25
3, 2014)). Ms. Heapy did adequately prepare for her deposition and was able to provide
the reasons for Mr. Prude’s termination.
Further, Defendant, in response to Plaintiff’s Motion to Compel, provided a sworn
affidavit from a Board member, Reverend Wilburt Shanklin. (Doc. #32, PageID #s 70406). Rev. Shanklin indicated that the Board discussed Mr. Prude’s employment issues
during an executive session and no meeting minutes were generated. Id. at 705. Ideally,
Ms. Heapy would have known those details during her deposition. But, a “30(b)(6)
witness is not expected to perform with absolute perfection.” Pogue, No. 3:14-CV-598CRS, 2017 WL 3044763, at *8 (citing QBE Ins. Corp. v. Jorda Enterprises, Inc., 277
F.R.D. 676, 691 (S.D. Fla. 2012)).
v.
Reasonable Attorney Fees and Costs
Under Rule 30(d)(2), a court “may impose an appropriate sanction—including the
reasonable expenses and attorney’s fees incurred by any party—on a person who
impedes, delays, or frustrates the fair examination of the deponent.”
Plaintiff asks the Court to award attorneys’ fees—at an hourly rate of $500 per
hour—for the time spent preparing the motion to compel. Plaintiff also asks the Court to
order Ms. Heapy and Defendant’s employees “to directly and fully respond to questions
posed by Plaintiff’s counsel unless subject to a valid exception under Rule 30(c)(2); and
… order Mr. Freudiger, as counsel for Defendant, to refrain from making speaking
objections and comments intended to influence the testimony, such as ‘if you know.’”
(Doc. #29, PageID #270).
26
Although Defendant’s counsel’s conduct during the deposition of Ms. Heapy was
improper at times, the imposition of sanctions is presently unwarranted because Plaintiff
was not ultimately prevented from conducting a “fair examination of the deponent.” Fed.
R. Civ. P. 30(d)(2).
In this contentious case, counsel for both parties “should strive to be cooperative,
practical and sensible, and should turn to the courts (or take positions that force others to
turn to the courts) only in extraordinary situations that implicate truly significant
interests.” Cable & Computer Tech., 175 F.R.D. 646, 652 (citations and internal
quotations marks omitted); see also Saria v. Mass. Mut. Life Ins. Co., 228 F.R.D. 536,
539 (S.D.W. Va. 2005) (“The integrity of the discovery process rests on the faithfulness
of parties and counsel to the rules—both the spirit and the letter. [T]he discovery
provisions of the Federal Rules are meant to function without the need for constant
judicial intervention and … those Rules rely on the honesty and good faith of counsel in
dealing with adversaries.”) (quoting Poole v. Textron, Inc., 192 F.R.D. 494, 507 (D. Md.
2000)) (citation and internal quotation marks omitted).
IT IS THEREFORE ORDERED THAT:
1.
Defendant’s Motion for Protective Order (Doc. #28) is denied; and
2.
Plaintiff’s Motion to Compel Discovery and Request for Attorneys’
Fees and Expenses (Doc. #29) is granted, in part, and denied, in part.
June 13, 2018
s/Sharon L. Ovington
Sharon L. Ovington
United States Magistrate Judge
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