Alberto v. Toyota Motor Corp...

• Decision Date: 05 August 2010
• Docket Number: Docket No. 296824.
• Citation: 796 N.W.2d 490,289 Mich.App. 328
• Parties: ALBERTOv.TOYOTA MOTOR CORPORATION.
• Court: Court of Appeal of Michigan — District of US

289 Mich.App. 328

796 N.W.2d 490

ALBERTO

v.TOYOTA MOTOR CORPORATION.

Docket No. 296824.

Court of Appeals of Michigan.

Submitted May 13, 2010, at Detroit.Decided Aug. 5, 2010, at 9:00 a.m.

Hilborn & Hilborn, P.C. (by George Hilborn), Birmingham; Thomas J. Murray & Associates (by Thomas J. Murray), Grand Rapids; Edgar F. Heiskell, III; Bailey & Glasser, LLP (by Benjamin L. Bailey, Eric B. Snyder, and Robert P. Lorea); Lewis & Babcock (by A. Camden Lewis); and Bendure & Thomas (by Mark R. Bendure), Detroit, for Lilia Alberto.Bowman and Brooke LLP (by Lawrence C. Mann, Andrea L. Moody, and Carmen M. Bickerdt), Troy, for Toyota Motor Sales U.S.A., Inc.Dickinson Wright PLLC (by Robert W. Powell, Phillip J. DeRosier, Detroit, and Michael D. Bossenbroek, Bloomfield Hills), and Hugh F. Young, Jr., for Product Liability Advisory Council, Inc.Before: SAAD, P.J., and JANSEN and DONOFRIO, JJ.SAAD, P.J.

Defendant Toyota Motor Sales U.S.A., Inc.,¹ appeals by leave granted the trial court's order that denied its motion for a protective order to quash the depositions of two corporate officers, Yoshimi Inaba and Jim Lentz. We vacate the trial court's order and remand this case for further proceedings.

I. FACTS AND UNDERLYING PROCEEDINGS

This is a personal-injury, products-liability suit wherein plaintiff seeks to depose two high-ranking Toyota corporate officers in connection with the claim that a defect in a Toyota vehicle caused the accident that resulted in the death of plaintiff's decedent.

Plaintiff filed this wrongful-death action and claimed that the decedent drove a 2005 Toyota Camry at a speed of less than 25 miles an hour when the vehicle suddenly accelerated to a speed in excess of 80 miles an hour. Plaintiff also asserts that the decedent attempted unsuccessfully to apply the vehicle's brakes, but the vehicle struck a tree, went airborne, and struck another tree, and plaintiff's decedent sustained fatal injuries.

Plaintiff noticed the video depositions of Yoshimi Inaba, defendant's chairman and chief executive officer, and Jim Lentz, defendant's president and chief operating officer, pursuant to MCR 2.306 and MCR 2.315. Defendant moved for a protective order pursuant to MCR 2.302(C) to prevent the depositions, because defendant says that neither Mr. Inaba nor Mr. Lentz “participated in the design, testing, manufacture, warnings, sale, or distribution of the 2005 Camry, or the day-to-day details of vehicle production,” and that neither officer had “unique information pertinent to issues in the case.” Defendant also avers that plaintiff could not show that the depositions of Messrs. Inaba and Lentz were necessary to prevent injustice, because the information plaintiff sought could be obtained from those persons who worked directly on the design, testing, and manufacture of the vehicle at issue. Defendant noted that Michigan adheres to the so-called “ apex-deposition rule” for high-ranking governmental officials, observed that various federal and state courts had applied the apex-deposition rule to high-ranking corporate officers in addition to governmental officials, and argued that Michigan should do so as well.

In response, plaintiff argues that while Michigan has adopted the apex-deposition rule for public officials, it has not applied the apex-deposition rule in connection with high-ranking corporate officers, and that even if Michigan were to adopt the apex-deposition rule for corporate officers, it should not apply here. Plaintiff contends that Mr. Lentz has been the “public face” of Toyota as the company's safety problems became widely known and emphasized that Mr. Lentz had made numerous public appearances and testified before Congress regarding Toyota's recent recalls of vehicles.² Plaintiff also noted that Mr. Inaba had testified before Congress regarding Toyota's efforts to complete its current recalls and review its quality-control processes and had said that he would be involved in the quality-control review.

Though the trial court found that Messrs. Inaba and Lentz were apex, or high-ranking, corporate officers, the trial court held that Michigan's caselaw and court rules did not preclude the depositions from taking place.

Defendant sought leave to appeal in this Court and moved for immediate consideration and a stay of the depositions. Ultimately, this Court granted defendant's application and continued in effect a prior order of the Court that had stayed the depositions of Messrs. Inaba and Lentz. The Court also ordered the appeal expedited and directed the parties to “address specifically the issue of whether the apex deposition rule should or does apply to corporate defendants.” Alberto v. Toyota Motor Corp, unpublished order of the Court of Appeals, entered March 11, 2010 (Docket No. 296824).

II. NATURE OF THE CASE AND THE APEX–DEPOSITION RULE

This appeal presents the question whether Michigan should formally adopt the apex-deposition rule in the corporate context. As used by other state and federal courts, the apex-deposition rule provides that before a plaintiff may take the deposition of a high-ranking or “apex” governmental official or corporate officer, the plaintiff must demonstrate both that the governmental official or corporate officer possesses superior or unique information relevant to the issues being litigated and that the information cannot be obtained by a less intrusive method, such as by deposing lower-ranking employees. See, e.g., Baine v. Gen. Motors Corp., 141 F.R.D. 332, 334–335 (M.D.Ala., 1991).

Courts have applied the apex-deposition rule not to shield high-ranking officers from discovery, but to sequence discovery in order to prevent litigants from deposing high-ranking governmental officials as a matter of routine procedure before less burdensome discovery methods are attempted. See, e.g., Sneaker Circus, Inc. v. Carter, 457 F.Supp. 771, 794 n. 33 (E.D.N.Y., 1978). Courts have reasoned that giving depositions on a regular basis would impede high-ranking governmental officials in the performance of their duties, and thus contravene the public interest. See, e.g., Union Savings Bank v. Saxon, 209 F.Supp. 319, 319–320 (D.D.C., 1962). In essence, the apex-deposition rule prevents high-ranking public officials from being compelled to give oral depositions unless a preliminary showing is made that the deposition is necessary to obtain relevant information that cannot be obtained from another discovery source or mechanism. Baine, 141 F.R.D. at 334–336.

Premised on similar reasoning, several federal appellate and district courts have extended application of the apex-deposition rule to high-ranking corporate executives. Generally, these cases hold that before a high-ranking corporate executive may be deposed, the plaintiff must establish that the executive has superior or unique information regarding the subject matter of the litigation and that such information cannot be obtained through a less intrusive method, such as by deposing lower-ranking executives. See, e.g., Salter v. Upjohn Co., 593 F.2d 649, 651 (C.A.5, 1979); Lewelling v. Farmers Ins. of Columbus, Inc., 879 F.2d 212, 218 (C.A.6, 1989); Thomas v. Int'l Business Machines, 48 F.3d 478, 482–484 (C.A.10, 1995); Mulvey v. Chrysler Corp., 106 F.R.D. 364, 366 (D.R.I., 1985); Baine, 141 F.R.D. at 334–336; Evans v. Allstate Ins. Co., 216 F.R.D. 515, 518–519 (N.D.Okla., 2003).

State courts, including those in California and Texas, have also adopted the apex-deposition rule in the corporate context. For example, in Liberty Mut. Ins. Co. v. San Mateo Co. Superior Court, 10 Cal.App.4th 1282, 1289, 13 Cal.Rptr.2d 363 (1992), the California Court of Appeal, relying on federal decisions such as Salter, Mulvey, and Baine, adopted the apex-deposition rule in the corporate context and held that the potential deponent, the president and chief executive officer of Liberty Mutual, could not be deposed absent a showing that the officer had “unique or superior personal knowledge of discoverable information.” The Liberty Mut. court held that absent such a showing, “the trial court should issue the protective order and first require the plaintiff to obtain the necessary discovery through less intrusive methods.” Id. If after these less intrusive methods are exhausted and the plaintiff makes a showing that the apex officer has information relevant to the case, the trial court may allow the deposition to proceed. Id. Similarly, in Monsanto Co. v. May, 889 S.W.2d 274, 277 (Tex., 1994), the Texas Supreme Court, relying on federal decisions such as Salter and Mulvey and on the decision in Liberty Mut., adopted the apex-deposition rule and held that the rule “presents a fair balance between the right of a plaintiff to conduct discovery in its case within the limits of the rules, and the right of someone at the apex of the hierarchy of a large corporation to avoid being subjected to undue harassment and abuse.”

The question posed by Toyota's motion and the trial court's order is whether Michigan caselaw should take into account the position within an organization of the person sought to be deposed. Because Michigan's court rules contemplate such a rule and because our courts have, in essence, applied the principles of the apex-deposition rule to governmental officials, albeit, without using the aforementioned terminology, and because there is no principled reason for not affording similar safeguards to corporate defendants, we hereby adopt the apex-deposition rule as explained more thoroughly below.

III. ANALYSIS

We hold that the apex-deposition rule applies to high-ranking officials in the public sector and to high-ranking corporate officers in the private sector.

Michigan has a broad discovery policy that permits the discovery of any matter that is not privileged and that is relevant to the pending case. MCR 2.302(B)(1); Reed Dairy Farm v. Consumers Power Co., 227 Mich.App. 614, 616, 576 N.W.2d 709 (1998). However,...