Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_15-mc-00146/USCOURTS-caed-2_15-mc-00146-2/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: Civil Miscellaneous Case

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UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF CALIFORNIA 

CITY OF STERLING HEIGHTS 

GENERAL EMPLOYEES’ 

RETIREMENT SYSTEM, Individually 

and on Behalf of All Others Similarly 

Situated, 

Plaintiffs, 

v. 

PRUDENTIAL FINANCIAL, INC., et al., 

Defendants. 

No. 2:15-mc-0146 WBS AC 

Main Case: 2:12-cv-5275 MCA LDW 

(D.N.J.) 

ORDER 

 This is a Miscellaneous proceeding brought by movant, Commissioner David E. Jones, the 

California Insurance Commissioner. Commissioner Jones moves to quash the deposition 

subpoena served upon him by plaintiffs. The underlying litigation is pending in the U.S. District 

Court for the District of New Jersey. See City of Sterling Heights Gen’l Employees’ Retirement 

Sys. v. Prudential, 2:12-cv-5275 MCA LDW (D.N.J.). This proceeding was referred to the 

undersigned by E.D. Cal. R. 302(c)(1). 

 For the reasons that follow, the motion to quash will be granted. 

I. BACKGROUND 

 On November 11, 2015, plaintiffs served a deposition subpoena on the Commissioner. 

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The subpoena “seeks deposition testimony from the Commissioner regarding his personal 

knowledge and his state of mind as to the public statements he made” about a multi-state 

investigation or examination into the insurance practices of defendant Prudential Financial Inc., 

and the subsequent settlement of that investigation. 

II. THE POSITIONS OF THE PARTIES 

 The Commissioner argues that as the elected head of California’s Department of 

Insurance, plaintiffs may not take his deposition because they have not first shown, in accordance 

with the “apex doctrine,” that (1) he has unique first-hand, non-repetitive knowledge of the facts 

at issue in the underlying case, and (2) plaintiffs have exhausted other less intrusive discovery 

methods. Joint Statement (ECF No. 12) at 14 (citing K.C.R. v. City of Los Angeles, 2014 WL 

3434257 at *3, 2014 U.S. Dist. LEXIS 98279 at *9 (C.D. Cal. 2014) (Segal, M.J.)). The 

Commissioner further argues that it would be unduly burdensome to subject him to a deposition 

here, where his only asserted connection to the Prudential investigation is his public statements 

made on behalf of the Insurance Department. 

 Plaintiffs argue that the Commissioner is not an “apex” deponent, and that in any event, 

they have met the requirements of the apex doctrine. Plaintiffs cite the Commissioner’s public 

statements as evidence that he has “direct, firsthand knowledge of the facts regarding the 

Department’s investigation and settlement” regarding Prudential. They further argue that they 

have exhausted their other options for obtaining the information they seek. 

III. MEET AND CONFER ACTIVITIES 

 The parties have met and conferred to impasse. Joint Statement at 8. 

IV. ANALYSIS 

 A. Standards and the Apex Doctrine 

 Using the ordinary standards applicable under the Federal Rules of Civil Procedure, the 

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court must quash the subpoena if Commissioner Jones shows that it would impose an “undue 

burden.” Fed. R. Civ. P. (“Rule”) 45(d)(3)(iv); see United States v. $177,844.68 in U.S. 

Currency, 2015 WL 4227948 at *4, 2015 U.S. Dist. LEXIS 90579 at *11 (D. Nev. 2015) (Foley, 

M.J.) (“A party seeking to quash or modify a subpoena under Rule 45 “bears the burden of 

showing why a discovery request should be denied”); see also, Rule 26(c) (protective order is 

available upon a showing of “good cause,” which includes a showing of “undue burden”); Rivera 

v. NIBCO, Inc., 364 F.3d 1057, 1063 (9th Cir. 2004) (“The burden is upon the party seeking the 

order to ‘show good cause’ by demonstrating harm or prejudice that will result from the 

discovery”), cert. denied, 544 U.S. 905 (2005); Blankenship v. Hearst Corp., 519 F.2d 418, 429 

(9th Cir. 1975) (“A strong showing is required before a party will be denied entirely the right to 

take a deposition”). 

 Normally, a putative non-party deponent’s mere assertion that he is not in possession of 

relevant information would not be sufficient to avoid a deposition, since the requesting party is 

entitled to test the asserted lack of knowledge. See Lexington Ins. Co. v. Sentry Select Ins. Co., 

2009 WL 4885173 at *6 (E.D. Cal. Dec. 17, 2009) (Austin, M.J.). However, “a different result is 

sometimes reached when the proposed deponent is a busy government official, or a very high 

corporate officer unlikely to have personal familiarity with the facts of the case.” Id. That is 

because the head of a government agency could have all of his or her time monopolized by 

discovery in lawsuits to which they are not even parties, if they could be compelled to testify 

every time the agency carried out its responsibilities.1 For that reason, “[v]irtually every court 

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 Cases have barred such “apex” depositions even when the deponent is a named 

defendant, or a corporate officer of the defendant, in the underlying lawsuit. See, e.g., K.C.R. v. 

Cty. of Los Angeles, 2014 WL 3434257, 2014 U.S. Dist. LEXIS 98279 (C.D. Cal. 2014) 

(denying compelled deposition of defendant Tanaka under the apex doctrine); Bicek v. C & S 

Wholesale Grocers, Inc., 2013 WL 5425345, 2013 U.S. Dist. LEXIS 139897 (E.D. Cal. 2013) 

(Newman, M.J.) (granting protective order and vacating deposition subpoenas for two “top-level 

executives” of defendant corporation under the apex doctrine). 

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that has addressed deposition notices directed at an official at the highest level or ‘apex’ of 

corporate management has observed that such discovery creates a tremendous potential for abuse 

or harassment.” Groupion, LLC v. Groupon, Inc., 2012 WL 359699 at *2, 2012 U.S. Dist. 

LEXIS 12684 at *6 (N.D. Cal. 2012) (James, M.J.) (internal quotation marks omitted); Apple Inc. 

v. Samsung Elecs. Co., Ltd, 282 F.R.D. 259, 263 (N.D. Cal. 2012) (Grewal, M.J.) (“[w]hen a 

party seeks the deposition of a high-level executive (a so-called ‘apex’ deposition), courts have 

observed that such discovery creates a tremendous potential for abuse or harassment”) (some 

internal quotation marks omitted). 

 Accordingly, many district courts have invoked the “apex doctrine” when a party seeks to 

compel a high-level governmental or corporate official to testify at a deposition. Under that 

doctrine, the burden is shifted to the party seeking the deposition to show that it is warranted: 

“parties seeking to depose a high ranking corporate officer must first establish that the executive 

(1) has unique, non-repetitive, firsthand knowledge of the facts at issue in the case, and (2) that 

other less intrusive means of discovery, such as interrogatories and depositions of other 

employees, have been exhausted without success.” Bicek v. C & S Wholesale Grocers, Inc., 2013 

WL 5425345 at *4, 2013 U.S. Dist. LEXIS 139897 at *11 (E.D. Cal. 2013) (Newman, M.J.) 

(internal quotation marks omitted). Although the U.S. Supreme Court and the Ninth Circuit have 

both recognized that depositions of public agency and executive department heads are disfavored, 

see United States v. Morgan, 313 U.S. 409, 421-22 (1941), Kyle Eng’g Co. v. Kleppe, 600 F.2d 

226, 231 (9th Cir. 1979), neither has expressly authorized shifting the burdens assigned by the 

Federal Rules of Civil Procedure. 

 B. Resolution 

 As discussed below, Commissioner Jones has shown, under the ordinary rules applicable 

to such motions, that the requested deposition would impose an undue burden on him as 

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Commissioner. Accordingly, while the concerns animating the apex doctrine weigh heavily on 

these proceedings, there is no need in this case to engage in (or determine the propriety of) the 

burden-shifting contemplated by that doctrine. See Mansourian v. Bd. of Regents of Univ. of 

Cal. at Davis, 2007 WL 4557104 at *3, 2007 U.S. Dist. LEXIS 95428 at *8 (E.D. Cal. 2007) 

(Brennan, M.J.) (relying “on the overarching dictates of the Federal Rules of Civil Procedure in 

determining whether or not a protective order should issue”). 

 1. Insurance Commissioner is routinely named in litigation 

 The Commissioner argues that he is “routinely” named as a party in litigation relating to 

the Insurance Department. Declaration of Michael Sapoznikow (“Sapoznikow Decl.”) (ECF 

No. 3) ¶ 17. In fact, the Insurance Commissioner – not just Commissioner Jones specifically – is 

named in well over 100 cases involving insurance issues. Therefore, requiring the Insurance 

Commissioner to be subjected to a deposition every time a case involving a California insurer 

arises, would be a burden, and that burden would be undue if the Commissioner can show that 

there is no good reason for taking his testimony. 

 The burden faced by the Commissioner is well illustrated by plaintiff’s reliance here on 

his public statements. Specifically, plaintiffs cite Commissioner Jones’s discussion, posted on the 

Department’s website, of two other insurers, besides defendant Prudential, who have also settled 

with the Department. Joint Statement at 28. Parties litigating in the wake of those settlements 

would presumably want the Commissioner’s testimony as much as these plaintiffs do. In 

addition, the insurer conduct that led to the multi-state investigation and settlement has spawned 

litigation all across the country against various insurers, at least one of which makes reference to 

the role of the California Insurance Department in the investigation.2

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 See, e.g., City of Westland Police & Fire Ret. Sys. v. MetLife, Inc., ___ F. Supp. 2d ___, 

2015 WL 5311196 at *3, 2015 U.S. Dist. LEXIS 121571 at *13 (S.D.N.Y. 2015) (“[a]ccording to 

Central States, state investigations into MetLife's accounting practices began as early as 2008, 

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 2. Commissioner Jones’s knowledge 

 Commissioner Jones asserts, through a declaration by Pam O’Connell, that he “did not 

manage or direct” the investigation of Prudential. December 16, 2015 Declaration of Pam 

O’Connell (“O’Connel Decl.”) (ECF No. 13) ¶ 12. Instead, he “received periodic updates” from 

O’Connell and other attorneys. Id. O’Connell herself “was the Department’s primary point of 

contact” for the investigation, and aside from department attorneys, “no other Department 

employees had a significant involvement.” Id. ¶ 11. Finally, Commissioner Jones “was not 

directly involved in any settlement negotiations with Prudential.” Id. ¶ 13. 

 This showing meets Jones’s initial burden of demonstrating that there is no good reason 

for taking his deposition in this case. Plaintiffs are seeking information about the Prudential 

examination and settlement from a non-party who has shown that he does not have information 

about it. 

 Plaintiffs attempt to refute Jones’s assertions by citing his public statements about the 

examination and the settlement. However, given the O’Connell declaration, it is plain that those 

statements were issued on behalf of the Department, and not by the Commissioner personally. 

The statements do not show that Jones had any direct, personal knowledge or involvement with 

the investigation. Every cited statement is entirely consistent with a department issuing press 

releases in the name of the department head, and based upon information communicated to him 

by his staff. Plaintiffs have offered nothing to refute the O’Connell declaration.3

 

when the California Insurance Commission began to look into MetLife's alleged failure to pay 

some life insurance benefits even after learning that an insured had died”); Feingold v. John 

Hancock Life Ins. Co. (USA), 2013 WL 4495126 at *1, 2013 U.S. Dist. LEXIS 117070 at *3 (D. 

Mass. 2013) (dismissing securities class action lawsuit where it was alleged that “John Hancock 

regularly uses this database [the Death Master File] to determine when it may stop paying 

benefits but never to determine when it must start”), aff'd, 753 F.3d 55 (1st Cir. 2014). 

3

 At oral argument, plaintiffs asserted that they have information showing that 

Commissioner Jones does have personal knowledge, but that they could not disclose it without 

violating a confidentiality agreement or protective order of some kind. The court will not base its 

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 Plaintiffs particularly emphasize a statement Commissioner Jones made during a news 

interview, regarding a specific insurance claimant who was able to obtain benefits as a direct 

result of the investigation and settlement. Joint Statement at 28 (statement regarding Linda 

Pantarell). However, there is nothing about that interview to indicate that Jones was personally 

taking credit for getting the claimant her money. To the contrary, he talks about “what his office 

found,” and states that “because of his office, Linda Pantarell got $9,000 owed to her”). Joint 

Statement at 28 (emphasis in text). Nor is there any indication that he was giving the interview as 

a private citizen, rather than as “Insurance Commissioner Dave Jones.” Joint Statement at 28 

(emphasis in text). 

 3. Authenticating Commissioner Jones’s statements 

 At oral argument on this matter, plaintiffs argued that they wanted to be able to introduce 

Commissioner Jones’s public statements into evidence at trial, and that the statements would be 

inadmissible without deposition testimony providing the basis for the statements. However, 

plaintiffs did not explain why the desired deposition testimony would overcome a hearsay 

objection. Viewed in light of the O’Connell declaration, those statements were plainly based 

upon what the Commissioner had been told by his attorneys and staff. 

 4. Relevance 

 Plaintiffs state that they want to establish Jones’s “state of mind as to the public 

statements he made.” Joint Statement at 30. Further, they state that no one else can substitute for 

Jones to tell them “what Commissioner Jones meant in his public statements regarding the 

investigation into and settlement of Prudential’s unclaimed property practices or why 

Commissioner Jones released those statements when he did.” Joint Statement at 41. 

 However, plaintiffs have not explained how Jones’s state of mind has any relevance to 

 

ruling upon information that is not placed before it in some way. See, e.g., E.D. Cal. R. 141 

(procedure for sealing documents). 

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their underlying securities lawsuit, nor why the timing of the statements matters to their securities 

lawsuit, or what it is about Jones’s statements that they need clarified. Without some showing 

that a deposition of Jones is likely to lead to some admissible evidence, the deposition of this nonparty is an undue burden. 

V. CONCLUSION 

 For the reasons stated above, IT IS HEREBY ORDERED that 

 1. Commissioner Jones’s Motion To Quash (ECF No. 1) is GRANTED; and 

 2. The Clerk of the Court shall close this case. 

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