TTAB: Deposition Site Doesn’t Hinge On Workplace Or Residence Of Corporate Designee

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If your company finds itself in a trademark dispute, it may be forced to pay the travel expenses of any corporate designee called to give a deposition under a recent ruling by the U.S. Trademark Trial and Appeal Board (TTAB).

In Flanders v. DiMarzio, Inc., a corporate designee witness insisted that the lawyers for both parties should travel to his place of residence – in Bozeman, Montana – rather than force him to travel to New York to be deposed in a law office.

The corporate defendant, DiMarzio, Inc., filed a motion for a protective order on behalf of the witness, Larry DiMarzio, forcing the TTAB to tackle a question of first impression, namely, whether a party seeking to depose the other side's corporate designee can require the designee to travel from his or her state of residence to the state of the corporation’s principal place of business for purposes of the deposition.

In support of the motion, DiMarzio Inc. argued that there is "no rule or case law from the Board requiring a 30(b)(6) witness to be deposed in a jurisdiction in which the witness does not live, nor is regularly employed.”

Since the company's designee is a natural person, DiMarzio Inc. argued, his deposition must take place in the federal judicial district where he resides or is regularly employed. In support of the motion, the designee submitted a declaration stating that the he had lived in Montana for more than two decades and that he worked out of the company's Montana office. In light of these facts, the company argued that the TTAB should issue an order protecting the designee from the “annoyance and oppressive demands” and “undue burden and expense” of being deposed in New York.

The TTAB denied the request for a protective order. In reaching this decision, the TTAB acknowledged that the Trademark Rules of Practice do not expressly state the location in which a party must depose a corporation under Rule 30(b)(6). However, looking to federal court decisions interpreting the Federal Rules of Civil Procedure, the TTAB concluded that the deposition of a corporation by its agents and officers should generally take place at the corporation’s principal place of business.

The TTAB concluded that, while it has broad discretion to determine the appropriate place for a Rule 30(b)(6) deposition, it should exercise that discretion only where “good cause justifies a departure from the general rule” that the deposition should take place at the corporation’s principal place of business. To determine whether good cause exists, the TTAB stated that it must consider the following factors:

  • location of counsel
  • burden of travel (including expense)
  • size of the party to be deposed and the regularity of executive travel
  • number of corporate representatives designated to testify
  • equities with regard to the nature of the claim and the relationship of the parties

In ruling that DiMarzio Inc. failed to establish good cause for the departure from the general rule, the TTAB noted that the deposition at issue was a 30(b)(6) notice – not a notice for the designee’s deposition in his individual capacity. It also noted that both parties had counsel located in New York and that the respondent had failed to identify any specific, undue burden, financial or otherwise, that traveling to New York would place on the respondent or the corporate designee.

The TTAB also relied on the fact that DiMarzio Inc. did not have to select this particular witness as its corporate designee and had failed to submit any evidence to suggest that, due to its size, this particular witness was the only witness that could testify on the respondent’s behalf at a 30(b)(6) deposition. Moreover, the TTAB acknowledged that, early on in the litigation, the corporate designee had demanded that the deposition take place in New York – a fact it found particularly compelling.

Finally, the TTAB concluded that the respondent had identified only one corporate designee to testify on its behalf, and that the respondent had failed to argue or submit evidence to suggest that the respondent would be unable to designate another witness located in New York to offer equally competent testimony regarding the identified topics.

In view of the foregoing, the TTAB ordered that the respondent must produce its corporate designee for deposition in New York.

Going forward, practitioners and parties should carefully consider the location of a person when determining whether to identify that person as a 30(b)(6) witness on behalf of a corporation. Under the Flanders decision, the possibility exists that the TTAB could require a witness residing in one state to travel to the state of the corporation’s principal place of business for the deposition. For smaller companies, the costs associated with such travel could prove a problematic. In such cases, it may be more prudent to educate a local witness on the topics necessary to testify on the corporation’s behalf.

Practitioners and parties should also refrain from making demands about the locations of depositions unless the parties want to be held to those demands. As seen in the case of Flanders, the TTAB is unlikely to view a reversal of position regarding the deposition location with favor.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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