Averkamp et al v. Swimways Corporation et al

Filing 46

ORDER signed by Judge Rudolph T. Randa on 11/17/2014 GRANTING 34 Motion to Compel Depositions. By 12/4/2014 Swimways must make Rachel Lee, Danny Zhang, and Jerry Jiang available for deposition. (cc: all counsel) (cb)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
ROBERT WILLIAM AVERKAMP,
and JANICE AVERKAMP
Plaintiffs,
and
BLUE CROSS BLUE SHIELD
OF WISCONSIN,
Involuntary Plaintiff
-vs-

Case No. 13-C-473

SWIMWAYS CORPORATION,
CNA FOUNDATION,
TARGET CORPORATION, and
ACE AMERICAN INSURANCE COMPANY
Defendants.

DECISION AND ORDER
This products liability action is before the Court on the motion to
compel the depositions of Rachel Lee (“Lee”), Danny Zhang (“Zhang”), and
Jerry Jiang (“Jiang”), three employees of Defendant Swimways Corporation
(“Swimways) who work in China. (ECF No. 34.) As will be further explained,
the Plaintiffs, Robert William and Janice Averkamp (the “Avercamps”), have
met their burden of establishing that the three employees are managing
agents of Swimways and, therefore, subject to deposition pursuant to Rule

30(b)(6) of the Federal Rules of Civil Procedure.
Pursuant to Rule 30(b)(6), “[i]f the person to be deposed is a
corporation, the party seeking discovery has the choice either to designate an
appropriate individual or to describe the subject matter of the questions to be
asked and allow the corporate deponent to designate its own spokesperson
familiar with that subject matter. If the party seeking discovery chooses the
former option, then the person designated must be ‘an officer, director, or
managing agent’ of the corporate deponent.”

Sugarhill Records Ltd. v.

Motown Record Corp., 105 F.R.D. 166, 169 (S.D.N.Y. 1985) (internal quotes
and citations omitted).
When determining whether an individual is a managing agent, courts
consider multiple factors, including: (1) whether the individual has general
powers allowing him to exercise judgment and discretion in corporate matters;
(2) whether the individual can be relied on to testify, at the corporation’s
request, in response to the discovery proponent’s demands; (3) whether there
are any other employees who have more authority than the individual in
regard to information concerning the subject matter at issue in the case; (4)
his general responsibilities respecting the matters involved in this litigation;
and (5) whether he can be expected to identify with the interests of the
corporation.

See Charles Alan Wright, et al., 8A Federal Practice and

Procedure § 2103, at 480-81 (3d ed. 2008); The Vision Ctr. Nw. Inc. v. Vision

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Value LLC, No. 3:07-CV-183 RLM, 2008 WL 4276240, at *3 (N.D. Ind. Sept.
15, 2008), aff’d, 2008 WL 4724722 (N.D. Ind. Oct. 21, 2008). No single factor is
conclusive, and courts typically focus on the degree of control the individual
has over the corporate affairs at issue. Id. The moving party has the burden
of establishing that the deponent is properly characterized as a managing
agent. The Vision Ctr. Nw. Inc., 2008 WL 4276240, at *2. The number of
factors considered by courts varies, but the test is a functional one decided on
a case-by-case basis. See Founding Church of Scientology of Wash., D.C., Inc.
v. Webster, 802 F.2d 1448, 1452 (D.C. Cir. 1986).
The

Avercamps

are

seeking

information

regarding

Swimways’

consideration of the design and alternative designs for the Toypedo, a hand
launched swimming pool projectile toy.
30(b)(6)

designated

corporate

They deposed Swimways’ Rule

representatives,

David

Arias

(“Arias”),

Swimways’ President, and Anthony Vittone (“Vittone”), Swimways’ Vice
President of Business and Legal Affairs, on the subject of the Toypedo design
and alternative designs. Although designated by Swimways, contrary to Rule
30(b)(6)’s requirement neither Arias nor Vittone prepared for the deposition
by discussing the topic of alternative designs with responsible employees or
reviewed correspondence directly on point. See Hooker v. Norfolk S. Ry. Co.,
204 F.R.D. 124, 126 (S.D. Ind. 2001); Alloc, Inc. v. Unilin Decor N.V., No. 02C-1266, 2006 WL 2527656, at *2 (E.D. Wis. Aug. 29, 2006). Vittone identified

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Swimways’ employees Zhang, Jiang, Lee, Tim Ellington (“Ellington”), Ed
Hayes (“Hayes”), and Paul Olsen (“Olsen”), Swimways’ Director of Product
Development and Operations for Asia, as having information about the
Toypedo designs.
The deposition testimony of Olsen, Hayes, and Ellington establishes
that from a functional standpoint Lee, Jiang, and Zhang are managers — each
is a key player in Swimways’ China team, and each has knowledge of the
Toypedo alternative designs, with Zhang having the most knowledge
regarding design modifications of the Toypedo and being Swimways’
connection with the factory in China that fabricates its products. Swimways
emphasizes that Lee, Jiang, and Zhang are mid-level employees and lack the
authority to make any unilateral binding decisions concerning any design
change or product modification (see Vittone Aff. ¶¶ 5, 8, 11, 13, ECF No. 38);
however those facts are not dispositive of the managing director analysis. See
Bianco v. Globus Med., Inc., No. 2:12-CV-00147-WCB, 2014 WL 977686, at *3
(E.D. Tex. Mar. 6, 2014) (collecting cases).
Lee is senior manager of account executives, Jiang is a manager of the
product integrity group, and Zhang manages the engineering department of
Swimways’ China office and is involved in “all the projects” conducted out of
that office. (Olsen Dep. 69:24-70:13.) (ECF No. 43-2, 45.) Hayes testified that
both Zhang and Olsen were responsible for developing a soft tip Toypedo

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prototype, but Zhang alone was tasked with discussing and developing the
prototype with the factory in China. (Hayes Dep. 24:13-25:18.) (ECF No. 45.)
The testimony of Hayes, Olsen, and Ellington establishes that Zhang had
significant decision-making power over alternative design and product
modification; Zhang was routinely assigned projects described in general
terms, and he worked with the factory in China to formulate specifications
and to test and analyze the results.

(See Hayes Dep. 11:23-12:25; 14:1-8;

23:23-25:18; 27:1-29:12; 34, 92-101:25;109-110; Ellington Dep.16:05-15; Olsen
Dep. 60:8-16; 54; 61:13-63-10; 65:10:25; 68:1-69:25; 71-85) (ECF Nos. 43-1-433, 45.) Furthermore, the proffered deposition testimony indicates that the
employment relationship between Swimways and Zhang, Jiang, and Lee and
the connection between their job responsibilities and the subject of the
Toypedo aligns their interests with that of Swimways and makes them
reliable deponents who may be expected to testify at Swimways’ request.
Based on the foregoing, the Court grants the Avercamps’ motion to compel the
Rule 30(b)(6) depositions of Lee, Jiang, and Zhang. See Bianco, 2014 WL
977686, at *3.
Swimways has also contended that Lee, Jiang and Zhang have
significant language difficulties. However, its contention is undermined by
Olsen, who does not speak Chinese. Olsen communicates with Lee, Jiang, and
Zhang exclusively in English, without use of an interpreter, and finds that

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each is understandable. Lee, Jiang, and Zhang also communicate in English
with other Swimways employees in the United States, and Olsen has not been
made aware of any complaints that language barriers pose a deterrent to
these communications.
NOW, THEREFORE, BASED ON THE FOREGOING, IT IS
HEREBY ORDERED THAT:
The Avercamps’ motion to compel the depositions of Lee, Jiang, and
Zhang (ECF No. 34) is GRANTED; and
Swimways must make Lee, Jiang, and Zhang available for deposition
no later than December 4, 2014.
Dated at Milwaukee, Wisconsin, this 17th day of November, 2014.

BY THE COURT:

__________________________
HON. RUDOLPH T. RANDA
U.S. District Judge

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