One of the differences between litigation in federal court and state court is the manner by which an adversary notices of the deposition of a corporation, and the location for deposition of various corporate witnesses.

In federal court deposition practice, a corporation is often requested in the first instance to produce individuals who are officers, directors or managing agents pursuant to Federal Rule of Civil Procedure 30(b)6. The deposition notice usually sets forth a set of categories for which the adversary is requesting witness testimony, and the corporation selects a responsive witness.

Unlike state court practice in New York, an adversary in federal court litigation may not notice the deposition of a corporation by a particular person who is not an officer, direct or managing agent. In fact, where the deposition of one who is not an officer or director is sought, the witness is considered a non-party, and the attendance of the “non-party” employee of a corporation at deposition must be procured by subpoena pursuant to the Federal Rules of Civil Procedure. Convermat Corporation v. St. Paul Fire Marine Insurance Company, 2007 U.S. Dist. LEXIS 69102 (E.D.N.Y. 2007). Ruinsky v. Harrah’s Entertainment, Inc., 2006 U.S. Dist. LEXIS 13149 (E.D.N.Y. 2006). The significance here is that the “non-party” employee will have to be subpoenaed and deposed in or about the district where that person works or resides, unless otherwise agreed. That “non-party” employee cannot be forced to come to New York if they work and reside out-of-state and more than one hundred miles away (F.R.C.P. 45), unless otherwise agreed.

Frequently, it is not an officer or director who possesses first-hand factual information. This becomes particularly important in federal court practice with regard to the category of “managing agents.” The question of whether a person is a managing agent, and therefore subject to a notice of deposition, is answered on a fact-specific basis, and courts generally consider factors such as:

1) Whether the individual is invested with general powers allowing the individual to exercise judgment and discretion in corporate matters;

2) whether the individual can be relied upon to give testimony, at the employer’s request, in response to the demands of the examining party;

3) whether any person or persons are employed by the corporation in positions of higher authority than the individual designated in the area regarding which the information is sought by the examination;

4) the general responsibilities of the individual respecting the matters involved in the litigation; and

5) whether the individual can be expected to identify with the interests of the corporation.

See, Schindler Elevator Corp. v. Ottis Elevator Company, 2007 U.S. Dist. LEXIS 44200 (S.D.N.Y. 2007). (holding that the examining party bears the burden of establishing the status of the witness, and that the determination of managing agent status is often reserved until the time of trial).

In New York state court practice, the Civil Practice Law & Rules § 3106 provides that a party seeking the deposition of a corporate entity may designate any employee, officer or director to be examined. One potential advantage pursuant to CPLR § 3106 over the applicable Federal Rules of Civil Procedure is the ability in New York state court practice for the corporation to avoid producing top management personnel, at least in the first instance. However, the caveat is that a non-managerial employee at the initial deposition may be asked questions as to corporate practices and procedures, and counsel representing the corporation must be aware of whether the non-managerial employee is a knowledgeable witness for that broad area of inquiry.

Also to be noted under New York State practice is that if the corporation has a multi-state presence and the individual employee to be examined has an out-of-state work location and residence, a simple subpoena served on corporate offices will suffice to force the sought corporate employee to come to New York for deposition. e.g. Standard Fruit and Steamship Company v. Waterfront Commission of New York Harbor, 43 N.Y.2d 11, 371 N.E.2d 453, 400 N.Y.S.2d 732 (1977); 23/23 Communications Corp. v. General Motors Corporation, 172 Misc. 2d g 21, 660 N.Y.S.2d 296 (Sup. N.Y. Co. 1997) (out-of-state employee may be required to appear for deposition merely upon notice to the employer, if it is a party to the case before the Court, but at the adversary’s expense.)

Corporate litigants are also cautioned that in New York state and federal courts, some non-party employees are subject to ex-parte interview by opposing counsel prior to depositions. Pursuant to Disciplinary Rule 7-104(A)(1), a corporate employee is generally deemed to be a “party” not subject to interview by opposing council if the employee whose acts or omissions in the matter under inquiry are binding on the corporation, and imputed to the corporation. Niesig v. Team I et al., 76 N.Y.2d 363, 558 N.E.2d 1030, 559 N.Y.S.2d 493 (1990). Yet, conversely, an employee who merely witnessed an incident may be subject to ex-parte informal interview by an adversary. The interview may not, however, touch upon privileged information existing between that employee and corporate counsel.

Our firm has experience in addressing these issues for a wide range of corporate clients in many different settings. One of our strengths is in laying out these issues for the client at the outset, and methodically addressing the various corporate witnesses.

  Rule 30(b)6 provides in pertinent part, that “A party may in the party’s notice and in a subpoena name as the deponent a public or private corporation or a partnership or association or governmental agency and describe with reasonable particularity the matters on which examination is requested.  In that event, the organization so named shall designate one or more officers, directors, or managing agents, or other persons who consent to testify on its behalf, and may set forth, for each person designated, the matters on which the person will testify.”