No. 01 C 1541 Page 5

to take depositions pertaining to it up to and including their last motion of February 26, 2006.
We find that plaintiffs have sufficiently shown cause for their delay in deposing McKinsey
personnel. While at the time the SOOF documents were delivered defendants told plaintiffs
that McKinsey had consulted on the project, it was not until plaintiffs found evidence linking
SOOF to PFP that they realized the need to depose people from McKinsey.

However, plaintiffs seek to depose specific McKinsey employees listed by Allstate
personnel as having consulted Allstate on other projects not related to SOOF. Instead of
deposing employees who may or may not have worked on SOOF, we direct plaintiffs to
ascertain those McKinsey personnel who did consult on SOOF, limit those deposed to a
maximum of three, and comply with the other restrictions set forth below.

Protective Order

Defendants move for a protective order to prevent the deposing and re-deposing ofa
number of Allstate employees. Rule 26(c) of the Federal Rules of Civil Procedure permits this
court to enter a protective order "to protect a party or person from annoyance,
embarrassment, oppression, or undue burden or expense." However, this request must be -
balanced against the broad provision of Rule 26(b)(1), which generally permits discovery of
any non-privileged information that “appears reasonably calculated to lead to the discovery
of admissible evidence.” A party seeking a protective order generally has the burden of
showing good cause “by a particular and specific demonstration of fact, as distinguished from
stereotyped and conclusory statements.” Steadfast Ins. Co., Inc. v. Auto Marketing Network,
Inc., No. 97 C 5696, 1999 U.S. Dist. LEXIS 6897 (N.D. Ill. May 3, 1999).

Defendants argue that plaintiffs should not be able to take these depositions as they

have already met their limit of ten depositions, and noticed up the additional depositions


No. OF C 1541 Page 8

be permitted to pursue discovery on the topic in order to gain such evidence for later use.

We therefore find defendants have not met their burden, and deny their motion for a
protective order. In the interests of time and efficiency, however, we limit plaintiffs to four
depositions of employees and/or former employees of their choosing from the list plaintiffs
provided.’ The depositions will be limited in scope to issues surrounding the SOOF
documents. Plaintiffs are further required to comply with the service requirements for
deponents no longer in Allstate’s employ. Finally, plaintiffs are to complete all of their
depositions, including those of McKinsey personnel, within 60 days from the date of this order.
We continue to expect to set a trial date at the August 29, 2007, status.

CONCLUSION

For the foregoing reasons plaintiffs’ motion for leave to take the deposition of

McKinsey & Company personnel is granted, and defendants’ motion for protective order is

denied.

JAMES B. MORAN
ior Judge, U. S. District Court

\ f 20 _, 2007.

>Exeluding, of course, McCabe, whose deposition plaintiffs apparently no longer seek.


No. O01 C 1541 Page 4

projects and initiatives, they were repeatedly told, during Allstate employee depositions, that
McKinsey did not work on anything that related to PFP. Plaintiffs argue that it was not until
they received the SOOF documents, which they allege laid the groundwork for PFP, that they
first realized McKinsey did in fact consult with Allstate on the topic.

We agree with plaintiffs. In the deposition sections plaintiffs provided to this court
(which are not rebutted by defendants), the Allstate employees deposed never connected
McKinsey with SOOF, nor connected SOOF with early indications of the later-developed PFP.
The deponents did list a number of McKinsey employees they worked with, but on other
projects, unrelated (according to them) to PFP. Therefore we do not find plaintiffs were
neglectful for not deposing them earlier.

Plaintiffs argue that their delay in requesting depositions of McKinsey personnel
resulted from the late production of the SOOF documents, the large amount of documents
produced, and changes in plaintiffs’ counsel that required new counsel to be brought up to
speed on the case. Defendants argue that the SOOF documents were not produced late, but
were produced in response to plaintiffs fourth request for documents propounded in June
2005. Plaintiffs counter that based on the content of the SOOF documents, they should have
been delivered in connection with plaintiff’s third request for documents which this court, in
September 2003, limited to “studies or inquiries between 01/01/08 - 11/30/99 concerning any
plan to terminate R830 and R1500 employee agents and to offer a severance plan in connection
with that termination” (order, 9/16/03, dkt. 56). Regardless of whether the documents were
produced late or on time, we find plaintiffs’ delaying the taking of the depositions to be
justified since they needed to review 17,000 pages of the SOOF documents prior to the taking

of the depositions. Plaintiffs further sought discovery extensions to complete this discovery and


No. 01 C 1541 Page 6

without requesting leave of court — in violation of Rule 30(a)(2)— to exceed their limit or to re-
depose certain witnesses. We note that plaintiffs’ motion to extend the discovery date to
February 28, 2006, was filed on November 4, 2005, but not granted by this court until
February 6, 2006, only 22 days before the modified discovery deadline. Further, the court’s
order granting the extension made no mention of the specific issues of new or repeat
depositions. Therefore, while we agree with defendants that plaintiffs’ notice was not proper,
we do not see plaintiffs’ conduct as an attempt to thwart the Federal Rules or the authority of
this court, and so do not see a reason to prevent plaintiffs from seeking these depositions.
Defendants attempt to shift the burden, and argue that plaintiffs fail to satisfy a
“heightened standard” of proof as to why plaintiffs should be permitted to depose high
ranking officials such as Ed Liddy and Phil Lawson, but they cite no cases where the Seventh
Circuit has adopted this so-called “apex” standard. See VanDenEng v. The Coleman Co.,
Inc., No. 03 C 0504, 2005 U.S. Dist. LEXIS 41748 (N.D. Iil. Sept. 23, 2005). In the case
defendants do cite, Patterson v. Avery Dennison Corp., 281 F.3d 676 (7th Cir. 2002), the
Seventh Circuit held that it would not disturb a district court ruling that the deposition of a
certain CEO was not warranted under the circumstances. As the court there noted, “district
courts have broad discretion in matters relating to discovery” (id. at 681), and thus the Seventh
Circuit reviews such rulings only for abuse of discretion. Corley v. Rosewood Care Ctr., Inc.,
142 F.3d 1041, 1052 (7th Cir. 1998); see also Johnson v. Jung, No. 02 C 5221, 2007 U.S. Dist.
LEXIS 34500, *8 (N.D. IIL May 10, 2007)(“Being a range, not a point, discretion allows two

decision-makers on virtually identical facts to arrive at opposite conclusions, both of which

*The third high-ranking official discussed in defendants’ motion, Ron McNeil, was no longer an
employee of Allstate at the conclusion of briefing and so defendants do not make further “apex” arguments as
to him.


IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
JAY F. FLANAGAN, JAMES W. CARSON,
JOHN M. CHANEY, and DONALD W. JONES,
individually and on behalf of all others
similarly situated,
Plaintiffs,

vs. No. 01 C 1541

ALLSTATE INSURANCE COMPANY, an

Illinois corporation, and the AGENT
TRANSITION SEVERANCE PLAN,

)

)

)

)

)

)

)

)

)

)

)

)

)
Defendants. )

MEMORANDUM OPINION AND ORDER

Plaintiffs, a class of former Allstate Insurance Company employees, move to take the
depositions of personnel from the consulting firm McKinsey & Company, who acted as
consultants to Allstate during the development of the “Sales Organization of the Future”
program (“SOOF”). Defendants Allstate and the Agent Transition Severance Plan (“Allstate”)
argue that plaintiffs waited too long to move for these depositions, as discovery has been closed
since February 28, 2006, and have not shown excusable neglect for their delay. Plaintiffs also
seek to depose, and re-depose, eight! current and former employees of Allstate based on the
information contained in the SOOF documents tendered to plaintiffs in discovery in
September 2005. Defendants have moved for a protective order to prevent these depositions,

arguing they are too late, redundant, and over-burdensome. For the following reasons, we

grant plaintiffs’ motion in part and subject to conditions, and deny defendants’ motion.

'Defendanis’ original motion for protective order included a ninth employee, Michael McCabe, in-
house counsel for Allstate. Plaintiffs did not address McCabe in their response, and thus we assume, as did
defendants in their reply, that plaintiffs have withdrawn their request to depose him.

Au


No. 01 C 1541 Page 7

constitute appropriate exercises of discretion.”). The circumstances here warrant the taking
of such depositions. The exhibits presented by plaintiffs demonstrate that Liddy and Lawson
most likely had personal knowledge of the circumstances surrounding the SOOF documents.
We find that Liddy and Lawson’s status as high-ranking officials alone, without evidence from
defendants that they do not have any relevant knowledge, is not enough to immunize them
from deposition. See Steadfast, 1999 U.S. Dist. LEXIS 6897, *5 (defendant “has offered no
affidavit from [corporate officer] attesting to a lack of knowledge and burden that would be
imposed by the deposition”).

Defendants argue that plaintiffs should not be able to re-depose previously deposed
witnesses. They claim that plaintiffs have failed to demonstrate that they will be unable to get
the same information from “an alternative, more convenient or less burdensome source.” Rule
26(b)(2). As stated before, it is defendants’ burden to demonstrate that plaintiffs can tap
another source for this information, and they have failed to meet this burden. Furthermore,
we hold that these depositions should be limited in scope to the SOOF documents and any
relation those documents have to the issues in this litigation (namely PFP and the Allstate
Agency Standards). Such a limitation will ensure that these depositions are not duplicative,
overly time-consuming, or burdensome.

Defendants argue that another district court, affirmed by the Seventh Circuit, found
that the SOOF documents had no relation to the PFP program or the strengthening of the

Allstate Agency Standards. See Isbell y. Allstate Ins. Co., No. 01 CV 00252, 2003 U.S. Dist.

LEXIS 21412 (N.D. IIL. Nov. 25, 2003) aff'd in part, rev'd in part 418 F.3d 788 (7" Cir. 2005).
Yet the fact that another court found a plaintiff not to have presented evidence of a such a

connection for summary judgment purposes is not relevant to whether plaintiffs here should


No. 01 C 1541 Page 2

BACKGROUND

On September 16, 2005, defendants produced to plaintiffs 17,000 pages of documents
relating to SOOF. Defendants produced these documents in a supplemental response to
plaintiffs’ fourth request for production. Discovery was set to close on September 28, 2005.
On September 26, 2005, the parties filed a joint motion, which this court granted, to extend the
discovery cutoff date to January 16, 2006. On November 4, 2005, plaintiffs filed another
motion to extend the discovery cutoff date, citing the large number of documents they had
received. We again granted the motion and extended the date to February 28, 2006, with the
caveat that there would be no further extensions. On February 13, 2006, plaintiffs gave notice
to defendants of nine current and former Allstate employees they wished to depose during the
week of February 22-28, 2006. On February 16, 2006, defendants moved for a protective order
to prevent those depositions from taking place. On February 24, 2006, plaintiffs again moved
to extend discovery cutoff. We stayed briefing on both motions pending the outcome of
plaintiffs’ motions for class certification and leave to amend their complaint. We denied the
discovery motion as moot on June 5, 2007, requesting, instead, that plaintiffs file a motion
specifically addressing the remaining discovery in which they wished to engage.

ANALYSIS

McKinsey Depositions

Federal Rule of Civil Procedure 6(b) states:

When by these rules or by a notice given thereunder or by order of court an act
is required or allowed to be done at or within a specified time, the court for
cause shown may at any time in its discretion (1) with or without motion or
notice order the period enlarged if request therefore is made before the
expiration of the period originally prescribed or as extended by a previous
order, or (2) upon motion made after the expiration of the specified period


No. 01 C 1541 Page 3

permit the act to be done where the failure to act was the result of excusable

neglect... .

The appropriate standard for determining whether to allow an extension depends on
when the request for the extension was filed. Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 896-
97 (U.S. 1990). Defendants argue that because plaintiffs’ motion was filed on June 12, 2007,
almost fifteen months after discovery closed, that the motion is governed by Rule 6(b)(2) and
the appropriate standard is “excusable neglect.” Plaintiffs assert that this motion is a
supplement to their motion to extend discovery, which was filed prior to the close of discovery,
and thus the more lenient standard under Rule 6(b)(1) is appropriate. We agree that plaintiffs
are not required to demonstrate excusable neglect. Plaintiffs filed their motion for extension
of discovery prior to the cutoff date. The long delay in its disposition was due to our decision
to stay briefing pending the outcome of a number of other motions. Furthermore, as we stated
during a status meeting with the parties, in light of our prior rulings and everyone’s desire to
move this case along, we would not now grant a blanket extension for discovery. Hence, we
denied plaintiffs’ earlier motion as moot, but invited them to re-file anew, outlining their
specific requests. We therefore analyze plaintiff's request for cause. See O'Regan v.

Arbitration Forums, Inc., 246 F.3d 975, 989 (7th Cir. 2001).

Plaintiffs argue that they need these depositions to determine the origin of the SOOF
documents and their relation to the later development of the “Preparing for the Future
Program” (“PFP”) and modification of the Allstate Agency Standards, which are at the center
of this litigation. Defendants argue that plaintiffs should have deposed McKinsey personnel
earlier, since they knew long prior to receiving the SOOF documents that McKinsey consulted
for Allstate. They state that plaintiffs even served a subpoena on McKinsey for documents

in 2002. Plaintiffs counter that while they knew McKinsey worked with Allstate on other