FILED
2 nr . PH 1: :i
SUPERIOR COUF T
4 01: rIJ4
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6 IN THE SUPERIOR COURT OF GUAM 7 INLAND BUILDERS CORPORATION, a CIVIL CASE NO.: CVOO7O-17 $ Corporation Plaintiff,
9 Counterclaim Defendant,
10 DECISION AND ORDER vs. (IBC’s Motion for Protective Order;
11 GEDA’s Motion to Compel)
GUAM ECONOMIC DEVELOPMENT AUTHORITY, a Public Non-Profit 12 Corporation, and DOES 1 THROUGH 5,
13 Defendants,
14 GUAM ECONOMIC DEVELOPMENT AUTHORITY, a Public Non-Profit 15 Corporation,
16 Counterclaimant.
17 GUAM ECONOMIC DEVELOPMENT AUTHORITY, a Public Non-Profit 1$ Corporation,
19 Third Party Plaintiff,
20 vs.
21 ARCHITECTS LAGUANA & CRISTOBAL LLC, 22 Third Party Defendant.
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CVOO7O-l7 Inland Builders Corp. v. GEDA, et at. Page 1 of 10 Decision and Order; IBC’s Mot. for Protective OrdeQ3Rj’GtN 1 INTRODUCTION 2 This matter came before the Honorable Anita A. Sukola on November 26, 2019, for a
3 Motion Hearing on Plaintiff/Counterclaim Defendant Inland Builders Corporation’s (“JBC”)
4 Motion for a Protective Order or Alternatively to Quash 30(b)(6) Deposition and 5 Defendant/Counterclaim Plaintiff Guam Economic Development Authority’s (“GEDA”) Motion
6 to Compel and for Sanctions for Failure to Appear. Attorney R. Marsh Johnson represents ifiC.
7 Attorneys Thomas I. Fisher and Rachel Taimanao-Ayuyu represent GEDA. Upon review of the
8 applicable law, the parties’ written and oral arguments, and for the reasons set out herein, the
9 Court hereby GRANTS IBC’s Motion for Protective Order and DENIES GEDA’s Motion to
10 Compel. Further, the Court holds that neither party will be sanctioned at this time.
11 BACKGROUND 12 On or about June 24, 2013, ffiC and GEDA entered into a construction contract for Phase
13 II of the Guam and Chamorro Educational Facility construction (“Agreement”). Compl. ¶ 5 (Jan.
14 26, 2017). During construction, ffiC encountered various delays, allegedly due to GEDA’s
15 conduct. Id. at ¶ 6. On September 19, 2014, ifiC sent a letter to GEDA asserting facts and
16 circumstances relating to the delays. id. at ¶ 7. On June 24, 2016, IBC served its First
17 Government Claim on GEDA in accordance with 5 G.C.A. § 620i of the Government Claims
18 Act, seeking additional compensation and a time extension. Id. at ¶ 9. GEDA formally rejected
19 this claim on December 23, 2016. Id. at ¶ 10.
20 On January 26, 2017, IBC filed a Complaint against GEDA in the Superior Court of
21 Guam, alleging breach of contract and seeking damages for work related to the Agreement.
22 Compl.at91915, 11.
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1 On April 25, 2017, JBC filed a Second Government Claim related to the same
2 construction project, seeking damages for additional delay periods allegedly caused by GEDA,
3 liquidated damages, and the remaining retention held by GEDA. Sterling DecL, Ex. A (Dec. 14,
4 2017). These claims are in addition to the amounts sought in ifiC’s First Government Claim,
5 which JEC included in its Complaint. GEDA denied the Second Government Claim on October
6 13,2017.Id.,Ex.D.
7 On May 15, 2017, GEDA filed an Answer to the Complaint and Counterclaim against
8 JBC for its own breach of contract claim. Def.’s Answer and Countercl. (May 15, 2017). On,
9 March 30, 2018, ffiC filed a Supplemental Complaint with the Superior Court of Guam, adding
10 damages related to its Second Government Claim.
11 The discovery period ended on October 28, 2019. On October 4, 2019, GEDA noticed
12 ifiC of its Rule 30(b) deposition for October 22, 2019. The Notice contains five topics of
13 inquiry:
14 1. The facts and circumstances regarding the Government Claims Act claims filed 24 June 2016 and 24 April 2017;
15 2. The facts and circumstances surrounding or supporting Plaintiff’s Complaint filed 26 January 2017 and Supplemental Complaint filed 30 March 2018 and 16 attachments to those complaints;
3. You responses provided to Interrogatories and Requests for Production made 17 by GEDA and particularly your recitation of monetary damage;
4. IBC’s understanding of contract and contract document provisions contained 18 in a contract to construct the Guam and Chamorro Educational Facility entered into by ffiC;
19 5. lB C’s Computation of Damages: as stated in your Initial Disclosures made 10 July 2018.
20 Johnson Deci., Ex. 3 (Oct. 21, 2019).
21 On October 14, 2019, ifiC sent GEDA an objection to the Notice, arguing a lack of 22 reasonable particularity: “Essentially you have asked [lBCJ to designate a person or persons to 23
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CVOO7O-17 Inland Builders Corp. v. GEDA. eta!. Page 3 of 10 Decision and Order; IBC’s Mot. for Protective Order; GEDA’s Mot. to Compel
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bind [IBCJ in connection with every contention it is making in the case.” Johnson Deci., Ex. 4.
2 On October 16, 2019, GEDA responded that it did not agree with the objection, and that the
3 deposition would proceed as scheduled on October 22, 2019. Id., Ex. 5. On October 21, 2019,
4 IBC filed a Motion for Protective Order, seeking to prohibit the deposition in its entirety. JBC
5 did not appear for the deposition on October 22, 2019.
6 On October 25, 2019, GEDA filed a Motion to Compel and for Sanctions for Failure to
7 Appear. On October 28, 2019, GEDA filed a Motion to Shorten Time. On November 19, 2019,
$ the Court issued a Decision and Order granting GEDA’s Motion to Shorten Time and setting an
9 expedited schedule for resolution of IBC’s Motion for a Protective Order and GEDA’s Motion to
10 Compel and for Sanctions. On November 26, 2019, the Court heard a Motion Hearing on both
11 motions and subsequently took the matters under advisement.
12 DISCUSSION 13 A. GEDA’s Notice of Deposition does not meet the “reasonable particularity” requirement of Rule 30(b)(6).
14 Guam Rule of Civil Procedure 30(b)(6) permits a party to depose a corporation. In 15 noticing the corporation’s deposition, the noticing party must “describe with reasonable 16 particularity the matters on which examination is requested.” Guam R. Civ. P. 30(b)(6). The 17 corporation “shall designate one or more officers, directors, or managing agents, or other persons 18 who consent to testify on its behalf, and may set forth, for each person designated, the matters on 19 which the person will testify.” Id. The designees must testify to matters known or reasonably 20 available to the corporation. Id.
21 As stated above, GEDA’s Notice to IBC contained five topics of inquiry which IBC 22 argues “are not stated with any degree of specificity whatsoever and are tantamount to simply 23
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CVOO7O-17 Inland Builders Corp. v. GEDA, et al. Page 4 ol’ 10 Decision and Order; IBC’s Mot. for Protective Order; GEDA’s Mot. to Compel asking [fflCJ to provide witnesses capable of testifying on anything at all related to the two
2 government claims raised by [ifiC].” Mot. for Protective Order at 5 (Oct. 21, 2019). IBC notes
3 that the combined length of its two Government Claims, including all attachments, totals 978
pages. ifiC argues that it cannot reasonably be asked to produce a witness or witnesses capable
of answering questions about all aspects of GEDA’s claims without being provided with more
6 specificity than contained in the Notice.
7 ifiC cites to Kalis v. Cotgctte-Falinolive Co., 231 F.3d 1049, 1058 (7th Cir. 2000), in
8 which the Seventh Circuit found that a party’s “generic Rule 30(b)(6) notice” did not meet the
9 “reasonably particular” standard. id., fn 5. This statement however, found in a footnote, was not
10 dispositive to the issues of the case and the court did not provide any analysis as to why that
11 notice was insufficient given the facts of that case. Given the fact-specific nature of the issue
12 before this Court, the Kcttis case provides very little insight. However, the Kalis court cites to
13 Prokosch v. Catalina Lighting, Inc., 193 F.R.D. 633, 638 (D. Minn. 2000), which is more
14 insightful as to the purposes of the “reasonably particular” requirement:
15 Since a corporation can only act through its employees, directors and agents, the potential thrives for an inquiring party to be bandied, from one corporate 16 representative to another, vainly searching for a deponent who is able to provide a response which would be binding upon that corporation.
17 On the other hand, a corporation should not be confronted with a seemingly 18 endless sequence of depositions which necessarily interfere with the capacity of its officers and employees to properly discharge their employment duties, and 19 which impose substantial financial costs.
20 Accordingly, to allow the Rule to effectively function, the requesting party must take care to designate, with painstaking specificity,1 the particular subject areas 21 that are intended to be questioned, and that are relevant to the issues in dispute.
Correlatively, the responding party must make a conscientious good-faith 22
23 IBC cites to the Prokosch Court’s use of this phrase “painstaking specificity.” Other courts have declined to adopt this standard in place of the “reasonable particularity” standard explicitly stated in Rule 30(b)(6). Murphy u, Kinart Corp., 255 F.R.D. 497, 506 (D.S.D. 2009) (Holding that the Prokosch court did not intend “to supplant the L’+ ‘reasonable particularity’ standard clearly articulated in Rule 30(b)(6).”).
CVOO7O-17 Inland Builders Corp. v. GEDA, eta!. PageS of 10 Decision and Order; IBC’s Mot. for Protective Order; GEDA’s Mot. to Compel
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1 endeavor to designate the persons having knowledge of the matters sought by [the interrogator] and to prepare those persons in order that they can answer fully, 2 completely, unevasively, the questions posed by [the interrogator] as to the relevant subject matters.
3 Id. (internal quotations and citations omitted).
A party is not excused from attending a deposition merely because there is no employee
who has the necessary knowledge to speak to every topic contained in the deposition notice. “A 6 party need only designate, with reasonable particularity, the topics for examination. The
corporation, then must not only produce such number of persons as will satisfy the request, but 8 more importantly, prepare them so that they may give complete, knowledgeable and binding
answers on behalf of the corporation.” Starlight Int’l Inc. v. Hethhy, 186 F.R.D. 626, 638 (D.
10 Kan. 1999). The United States District Court for the Middle District of North Carolina has 11 described the obligation of the deposed party as follows:
12 Rule 30(b)(6) implicitly requires the designated representative to review all . . .
13 matters known or reasonably available to it in preparation for the Rule 30(b)(6)
deposition. This interpretation is necessary in order to make the deposition a 14 meaningful one and to prevent the sandbagging of an opponent by conducting a half-hearted inquiry before the deposition but a thorough and vigorous one before 1) the trial. This would totally defeat the purpose of the discovery process. The Court understands that preparing for a Rule 30(b)(6) deposition can be 16 burdensome. However, this is merely the result of the concomitant obligation from the privilege of being able to use the corporate [or other organizational]
17 form in order to conduct business.
[A party] does not fulfill its obligations at the Rule 30(b)(6) deposition by stating it has no knowledge or position with respect to a set of facts or area of inquiry 19 within its knowledge or reasonably available.
20 United States v. Taylor, 166 F.R.D. 356, 362 (M.D.N.C.), aff’d, 166 F.R.D. 367 (1996). “If no
21 current employee has sufficient knowledge to provide the requested information, the party is
22 obligated to prepare [one or more witnesses] so that they may give complete, knowledgeable and
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CVOO7O- 17 Inland Builders Corp. v. GEDA, et at. Page 6 of 10 Decision and Order: IBC’s Mot. for Protective Order; GEDA’s Mot. to Compel
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1 binding answers on behalf of the corporation.” Dravo Cow v. liberty Mut ha Ca, 164 FaD. 2 70,75 (D.Neb. 1995). 3 In Prokosch, the plaintiffs in a product liability suit noticed the defendant, a seller of 4 lamps, of a Rule 30(b)(6) deposition in which the plaintiffs would be seeking information about 5 the product history and manufacturing process of the lamps, as well as any past claims involving 6 the lamps. 193 P.1W. 633,637(2000). The defendant corporation designated an individual to be 7 deposed, who during the deposition testified that he was unable to respond to the questions due 8 to a lack of information and knowledge. Id. Despite the broad nature of the information sought, 9 the Prokosch court found that the designated topics sufficed to meet Rule 30(b)(6)’s 10 requirements. IS (‘We are satisfied that the Plaintiffs adequately designated, after a 11 consciéntioás effort to focus its intended inquiry, the subject areas which were both temporally 12 and factually relevant to its claims in this matter.”). IS 13 In Lipad v. U.S. Bwworp, NA, No. CWA 07-2146-CM-DJW, 2008 WL 4642618, at *6 14 (D. Kan. Oct 16, 2008), the United States District Court of Kansas held that a deposition notice 15 failed to meet the “reasonably pafficulW’ requirement when the notice directed the corporation 16 produce a witness who could testify to all allegations raised in a 263-paragraph petition,
17 spanning more than 70 pages. In In re Independent Service Organizations Antitrust litigation,
18 168 ER.D. 651, 654 (D. Kan. 1996), the same court entered a protective order where a plaintiff 19 served a Rule 30(b)(6) deposition notice on the defendant Xerox Corporation, requesting that
20 xn produce a corporate witness “to testify about facts supporting numerous paragraphs of 21 Xerox’s denials and affirmative defenses in its Answer and Counterclaims.” See also Blackrock 22 Allocation Target Shares: Series S Portfolio v. Wells Fargo Bant Nat? Ass’n, No.
14CVO9371KPFSN, 2017 WL 9400671, at ‘1 (S.D.N.Y. Apr. 27, 2017) (“The organfrstional
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CVOO7O-17 Inland Builders Corp. v. GEDA, et aL Page 7 of 10 Decision and Order; IBC’s Mot for Protective Order; GEDA’s Mot to Compel 1 designee can be questioned about historical facts, as well as the opinions and beliefs of the
2 organization. But topics that generally seek testimony as to every fact that supports a legal claim
3 will likely fail the reasonable particularity requirement.”).
4 Based on the cases cited above, the Court holds that GEDA’s Notice of Deposition is
5 overly broad. GEDA’s topics include “facts and circumstances” concerning IBC’s two
6 Government Claims, each of which are based upon delays in the construction of the Guam and
7 Chamorro Educational Facility. The topics do not seem to require that IBC’s designee would
8 need any knowledge outside of the particular circumstances which led to the delays. However, in
9 light of the complex subject matter of this litigation, i.e. problems stemming from the
10 construction of a museum, the topics as noticed do not describe with reasonable particularity the
1 subjects of inquiry. The Complaint and Supplemental Complaint stem from seven separate
12 “delay periods” which were allegedly caused by various reasons such as design changes, delays
13 in securing legally mandated site inspections, and GEDA’s alleged lack of direction as to the
14 testing of certain building materials. Even considering the substantial burden placed on a
15 corporation to prepare an employee for a deposition, it is unreasonable to expect IBC to prepare
16 one of its employees to sufficiently answer questions regarding the reasons for every delay, as
17 well as the mathematics behind computing the damages incurred to ifiC due to the delays. This
18 preparation would be excessively time-consuming and the designated employee would
19 nonetheless be unable to answer every possible question regarding the Government Claims.
20 For the reasons above, the Court grants JEC’s Motion for Protective Order and denies
21 GEDA’s Motion to Compel. Despite the passing of the discovery period, the Court will allow
22 GEDA to amend its Notice of Deposition to better inform JEC of the topics to be covered.
23 Because the discovery period has passed, the deposition must occur on an expedited schedule.
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CVOO7O-17 In’and Builders Corp. v. GEDA. et al Page 8 of 10 Decision and Order; IBC’s Mot. for Protective Order; GEDA’s Mot. to Compel 1 GEDA may file its amended Notice of Deposition within fourteen (14) days of this Decision and
2 Order. The deposition is to take place before the next Further Proceedings, which are scheduled
3 for January 16, 2020. If this is not possible, the parties shall file a stipulated request for a time
4 extension.
5 B. IBC is not entitled to attorney fees. 6 ifiC asks the Court to sanction GEDA by awarding ifiC attorney fees for its Motion for
7 Protective Order and for opposing GEDA’s Motion to Compel. Because GEDA’s Motion to
8 Compel was denied, it is liable for IEC’s attorney fees unless it can show that its Motion was
9 substantially justified or other circumstances exist which would make an award of expenses
10 unjust. Guam R. Civ. P. 37(a)(4)(B).
In Pierce v. Underwood, 487 U.S. 552, 108 (1988), the Supreme Court of the United
12 States established the meaning of “substantially justified” within the context of the Equal Access
13 to Justice Act. In its analysis, the Court recognized the meaning that lower courts have attached
14 to “substantially justified” in the context of Rule 37(a)(4) and (b)(2)(E), which governs attorney
15 fees under the Federal Rules of Civil Procedure. Id. at 565. The Court stated that under Rule 37,
16 “[substantially justified] has never been described as meaning ‘justified to a high degree,’ but
17 rather has been said to be satisfied if there is a ‘genuine dispute,’ . . . or ‘if reasonable people 18 could differ as to [the appropriateness of the contested action] . . . .‘ Id. (internal citations 19 omitted).
20 The Court holds that there was a genuine dispute regarding whether the Notice of
21 Deposition was overly broad. Therefore, both GEDA and ifiC were substantially justified in
22 filing their motions and oppositions regarding the Notice. The Court’s decision to deny GEDA’s
23 Motion to Compel does not render GEDA’s position unreasonable. The discovery dispute giving
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CVOO7O-]7 Inland Builders Corp. v. GEDA, etal. Page 9 of 10 Decision and Order; IBC’s Mot. for Protective Order; GEDA’s Mot. to Compel 1 rise to the Motion to Compel involved legitimate issues of law upon which reasonable parties
2 could disagree. Therefore, no sanctions are appropriate at this time.
CONCLUSION
4 For the reasons stated herein, the Court hereby GRANTS ifiC’s Motion for Protective
5 Order and DENIES GEDA’s Motion to Compel. The Court will not sanction either party at this
6 time. GEDA may file an amended deposition notice within fourteen (14) days of this Decision
7 and Order. The deposition is to take place before January 16, 2020. If this is not possible, the
$ parties are to file a stipulated request for a time extension. The Court orders the parties to
9 cooperate going forward in an effort to avoid further disputes requiring the Court’s
10 involvement.
/ ‘Y.
12 SO ORDERED ‘.
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15 The Honorable Anita A. Sukola Judge, Superior Court of Guam 16
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CVOO7O-17 Inland Builders Corp. v. GEDA, etat. Page 10 of 10 Decision and Order; IBC’s Mm. for Protective Order; GEDA’s Mot. to Compel