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Schall v. Suzuki Motor of America, Inc.

United States District Court, W.D. Kentucky, Owensboro Division

November 21, 2017

DEREK SCHALL PLAINTIFF
v.
SUZUKI MOTOR OF AMERICA, INC.; SUZUKI MOTOR CORPORATION; and NISSIN KOGYO CO., LTD., DEFENDANTS

          MEMORANDUM OPINION AND ORDER

          H. BRENT BRENNENSTUHL, UNITED STATES MAGISTRATE JUDGE.

         Before the Court is a motion for protective order filed by Defendant Suzuki Motor Corporation (“SMC”) (DN 132). Relying on the general rule, SMC argues that the Court should issue a protective order requiring Plaintiff to conduct the Fed.R.Civ.P. 30(b)(6) deposition of its designated witness, Yoshinobu Matsumoto, in Japan because that is where SMC's principal place of business is located (DN 132). Schall objects to the motion because special circumstances exist that justify the Court issuing an order directing SMC to produce its Rule 30(b)(6) witness in Orange County, California, where SMC established the headquarters for its wholly-owned subsidiary Defendant Suzuki Motor of America, Inc. (“SMAI”) (DN 133). By agreement of the parties, no reply will be filed (DN 130). The motion stands submitted to the undersigned for ruling. For the reasons that follow, SMC's motion for protective order is denied.

         Background

         Schall filed his complaint on July 17, 2014 (DN 1) and his amended complaint on July 18, 2014 (DN 5). Schall asserts that he owned and operated a 2006 Suzuki motorcycle, model GSX-R600, equipped with a front brake master cylinder determined to be defective by SMC and SMAI (DN 5 ¶ 6, 38, 39). Specifically, he contends that the brake piston was insufficiently surface treated and this led to corrosion which, in turn, generated hydrogen gas which impaired the function of the brake system (Id. ¶ 27-29, 38). Schall claims that, due to this defect in the motorcycle's front master brake cylinder, he was unable to stop and was involved in a single-vehicle collision in which he sustained serious physical injuries (Id. ¶ 7, 39). Schall brought this action alleging strict products liability and negligence against SMC, the manufacturer of the motorcycle; SMAI, the importer of the motorcycle; and Nissin Kogyo Co., Ltd., the manufacturer of the front brake master cylinder (Id. ¶ 41-52).

         As a result of procedural and jurisdictional motion practice, the undersigned did not issue a scheduling order until May 29, 2015 (DN 52). Schall served initial written discovery on June 1, 2016 (DN 121 PageID # 1529). He issued initial Rule 30(b)(6) deposition notices to SMAI and SMC on July 1, 2015 (Id.). The actual scheduling of those depositions was delayed by litigation over the location of SMC's corporate representative deposition and scheduling issues concerning the availability of SMAI's representatives (Id.). In August 2015, SMAI and SMC produced documents in response to Schall's initial written discovery (Id.). SMAI made additional document productions in September, November, and December 2015 (Id.). During this time frame, SMC apparently produced over 131, 000 Japanese language documents, including emails (Id.).

         Schall took the depositions of SMAI's corporate representatives, Mark Eastman and Steve Muthig, on February 10 and 11, 2016, respectively. Schall took the deposition of SMC's corporate representative, Mr. Matsumoto, in California on March 9, 2016. At the time, Mr. Matsumoto was employed as the Director of Thai Suzuki Motor Co. Ltd. in Thailand (DN 123 PageID # 1620). SMC flew Mr. Matsumoto to California at its expense for the Rule 30(b)(6) deposition (Id.).

         There appears to be no dispute that Schall received six categories of documents from SMAI and SMC in the months following the corporate representative depositions. Specifically: (1) SMAI produced the post July 2013 “Siebel” reports[1]; (2) SMAI produced unredacted versions of the 97 “Siebel” reports that were generated through July 2013 and previously produced in redacted form; (3) SMAI produced the AIQ questionnaires[2]; (4) SMAI and SMC produced quality control guidelines and policies and procedures addressing the investigation of accidents and disclosure of a defect to SMC; (5) SMAI produced 1, 169 emails containing information about other similar incidents; and (6) SMC produced 54 documents selected by Schall for translation from Japanese to English language, as a resolution of an outstanding discovery dispute involving the thousands of Japanese language documents produced by SMC (DN 121 PageID # 1527-34; DN 123 PageID # 1620).

         In July of this year, Schall filed a motion, pursuant to Fed.R.Civ.P. 1, 26, and 30(b)(6), to reopen the depositions of corporate representatives for SMAI and SMC due to the newly produced documents (DN 121). SMAI and SMC objected to the motion (DN 123), and Schall filed a reply (DN 125).

         In a memorandum opinion and order filed on September 13, 2017, the undersigned observed that Schall took the deposition of SMC's corporate representative, Mr. Matsumoto, on March 9, 2016 (DN 127 PageID # 1715). Further, the undersigned recognized that in the months following that Rule 30(b)(6) deposition, SMC produced to Schall the following categories of documents: quality control guidelines and policies and procedures addressing the investigation of the accidents and disclosure of the defect to SMC; and 54 documents selected by Schall for translation from Japanese to English language, as a resolution of an outstanding discovery dispute involving the thousands of Japanese language documents produced by SMC (Id. PageID # 1715-16). In pertinent part the undersigned's ruling reads as follows:

The Court concludes that Schall should be permitted to reopen the Rule 30(b)(6) deposition with regard to both categories of documents.[3] Clearly, testimony by SMC's corporate representative about each category of documents is relevant, within the meaning of Rule 26(b)(6), to Schall's strict liability and negligence claims.
Obtaining testimony from SMC's corporate representative about the first category of documents is proportional to the needs of the case because the burden and expense incurred by SMC is outweighed by its importance to Schall's negligence claim regarding SMC's evaluation of complaints about the defect and the information it received from SMAI. With regard to Rule 26(b)(2)(C)(i), the information Schall seeks about SMC's policies is not unreasonably cumulative or duplicative, nor can it be obtained from some other source that is more convenient, less burdensome, or less expensive. In reaching this conclusion, the Court notes that SMC does not dispute that its corporate representative indicated he was unaware of policies and procedures governing the investigation of the defect and disclosure of the defect. Further, while interrogatories may provide an adequate basis to develop a working understanding about SMC's policies and procedures, deposing a Rule 30(b)(6) witness will provide Schall with the ability to tailor probing questions in response to the witness' answers to previous questions. Rule 26(b)(2)(C)(ii) does not provide SMC relief here because Schall's ability to conduct a probing examination was hamstrung by the material not having been produced and Mr. Matsumoto being unprepared for examination regarding the corporation's policies and procedures. Clearly, Schall is entitled to testimony from a Rule 30(b)(6) witness who is educated about this material and speaks on behalf of SMC.
Obtaining testimony from SMC's corporate representative about the 54 documents selected by Schall for translation from Japanese to English language is proportional to the needs of the case because the burden and expense incurred by SMC is outweighed by its importance to Schall's strict liability and negligence claims. With regard to Rule 26(b)(2)(C)(i), the information Schall seeks about these translated documents is not unreasonably cumulative or duplicative, nor can it be obtained from some other source that is more convenient, less burdensome, or less expensive. Rule 26(b)(2)(C)(ii) does not provide SMC relief here because Schall's ability to conduct a probing examination was hamstrung by the material's not having been translated prior to Mr. Matsumoto's deposition. Further, the Court declines SMAI's invitation to apply the distorting effects of hindsight to Schall's decision to proceed with the Rule 30(b)(6) deposition rather than wait for resolution of the discovery dispute over translations of the documents. Clearly, Schall is entitled to testimony from a Rule 30(b)(6) witness who is educated about this material and speaks on behalf of SMC.

(Id. PageID # 1716-17).

         In sum, the undersigned granted Schall's motion for leave to reopen the deposition of SMC's corporate representative because of conduct by SMC with regard to witness preparation and document production. Further, the undersigned sought to address this conduct by ordering SMC to produce a prepared and knowledgeable corporate representative to testify about the documents identified above (Id. PageID # 1718). Moreover, in an effort to address the delays precipitated by SMC and SMAI's conduct, the undersigned extended the fact discovery deadline to December 18, 2017 for the limited purpose of completing this and other specified depositions by “no later than December 15, 2017” (Id.) (emphasis in original).

         SMC has again designated Mr. Matsumoto as its corporate representative in the Rule 30(b)(6) deposition (DN 132 PageID # 1735-36). Instead of agreeing to once more produce him in California, on a date that complies with the Court's December 15, 2017 deadline, SMC has filed a motion for a protective order that would require Schall to conduct the Rule 30(b)(6) deposition in Japan. There is no dispute that if SMC's motion is granted, Schall will have to comply with all of the strict procedural requirements in the United States-Japan Consular Convention and Protocol Treaty (“the Treaty”) to conduct the deposition in Japan, and the soonest it might be conducted would be the spring or summer of 2018, months after the December 15, 2017 deadline specified in the Court's order.

         Arguments

         1. SMC's Motion

         SMC, a Japanese corporation with a principal place of business in Japan, has moved for entry of a protective order under Fed.R.Civ.P. 26(c)(1) because it contends there is a presumption that this Rule 30(b)(6) deposition must be conducted in Japan (DN 132 PageID # 1730-32). SMC asserts that Schall must rebut this presumption by demonstrating that “special circumstances” exist to conduct the deposition in the United States (Id.). SMC contends that the Court should consider cost, convenience, and litigation efficiency in determining whether Schall has demonstrated that “special circumstances” exist (Id. PageID # 1732).

         2. Schall's Response

         Schall asserts that following the Court's order, he repeatedly communicated with SMC about scheduling the Rule 30(b)(6) deposition (DN 133 PageID # 1785-89). Schall indicates that SMC waited until October 2, 2017 to announce that it would only produce Mr. Matsumoto in Japan (DN 133 PageID # 1785-89). Schall suggests that this delay is questionable due to SMC's previous discovery conduct and its knowledge of the lengthy and costly scheduling process for taking depositions in Japan (Id.). Referring to the United States-Japan Consular Convention and Protocol Treaty, Schall contends that the strict and burdensome regulations governing depositions in Japan are one of the main reasons that multiple courts have rejected Japanese defendants' arguments on this issue, instead finding that the deposition should be conducted in the United States (Id. PageID # 1786-1806). Schall submits that he has shown “good cause” to require SMC to produce Mr. Matsumoto, or any other representative it may designate, in California for the Rule 30(b)(6) deposition (Id.).

         Applicable ...


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