Foreign Corporation Depositions in Hawaii (Part 2)

Proudly Serving Honolulu, Maui, Kauai and the Big Island

When a foreign corporation has subjected itself to jurisdiction in the United States, exceptions to the general rule on the location of the deposition are often made. Id. at 466-67 citing Custom Form Mfg. v Omron Corp., 196 F.R.D. 333, 336 (S.D.N.Y., 2001). In considering whether a foreign corporation should be deposed in the United States rather than their own country, Courts have looked to “whether the time, expense, inconvenience of travel, presents a special hardship on the deponent, and the ability of the court to intervene should disputes arise.” Id. citing Afram Export Corp. v Metallurgiki Halyps, 772 F.2d 1358, 1365 (7th cir., 1985). It appears that sophistication of the deposing party and disputes between the parties are weighed in considering the above mentioned factors. See Six West Retail Acquisition v Sony Theatre Management Corp., 203 F.R.D. 98 (S.D.N.Y., 2001).

Similarly, in Custom Form Mfg. v Omron, the Plaintiff sought to compel the Court to order that depositions be held in Indiana rather than Japan, which was the corporation’s principal place of business. Custom Form Mfg. v Omron Corp., 196 F.R.D. at 336. In that case, the deposing party pointed out that “in Japan a witness cannot be compelled to produce anything, and also notes that Japanese laws forbid an employee, while on Japanese soil, from disclosing any information that its corporate employer may unilaterally label as a trade secret, even when the employee is under order of a United Stated Court to make such a disclosure.” Id. The deposed party responded that this reading of Japanese law was unsupported and the Japanese discovery rules could be “averted by stipulations relating to the conduct of the deposition agreed upon in advance.” Id. See also Dwelly v Yamaha Motor Corp., 214 F.R.D. 537, 541(D.Minn., 2003)(“Having considered the respective arguments, we conclude that the deposition of a supplemental Rule 30(b)(6) deponent should be taken in location where the corporation, for whom the deponent testifies, is located. Our ruling would have been different, absent the Defendants’ representation that they were waiving any insistence on adherence to Japanese procedures if the deposition were taken in Japan.”) The Indiana District Court, after weighing the parties’ arguments and a number of factors, concluded that “the best way to protect the discovery process in this case, and the best way to avoid sovereignty issues that might otherwise arise, is to compel that the Rule 30(b)(6) depositions of defendants’ employees take place in the United States.” Id. at 337. Further, “granting plaintiff’s motion to compel depositions at the Indiana or Illinois location would require fewer of the participants involved on both sides of this matter to travel, this, in turn, would cut costs and provide an economic benefit for all.” Id. at 338.

Moreover, in New Medium Technologies LLC. v Barco N.V , the Illinois District Court granted Plaintiff’s Motion to Compel after it decided that “conducting depositions in Japan . . . would severely compromise-to put it mildly- the court’s ability to intervene should problems arise.” New Medium Technologies LLC. v Barco N.V., 242 F.R.D. at 467. Further, the Court was not persuaded by deponent’s argument of “jet lag” because the witnesses were experienced businessmen who travel frequently. Id. at 468. Also, in response to deponent’s argument that there absence would burden the corporation, the Court held that “highly placed executives are not immune to discovery, and the fact that an executive has a busy schedule cannot shield him or her from being deposed” and such result is the “cost of doing business in the United States.” Id. at 469.

In addition, courts have allowed depositions of corporate defendants in alternate locations since “corporate defendants are frequently deposed in places other than the location of their principal place of business, especially when the deposition site is the forum most convenient to all parties and that which would best serves the general interest of judicial economy”. Custom Form Mfg. v Omron Corp., 196 F.R.D. at 338 citing Sugarhill Records Ltd. v Motown Record Corp., 105 F.R.D. 166, 171 (S.D.N.Y., 1985).

Finally, with regard to how travel costs should be allocated between the parties, courts have broad discretion. New Medium Technologies LLC. v Barco N.V. F.R.D 462 at 468-69. However, “in considering who should bear the costs of depositions the court should keep in mind that the federal rules are to be construed to secure the just, speedy and inexpensive determination of every action.” Custom Form Mfg. v Omron Corp., 196 F.R.D. at 338.