Court Opinion

ID: 4524216
Source: CourtListenerOpinion
Date Created: 2020-04-10 00:02:42.768859+00
Date Added: 2024-06-11T09:26:07.919248
License: Public Domain

The summaries of the Colorado Court of Appeals published opinions
  constitute no part of the opinion of the division but have been prepared by
  the division for the convenience of the reader. The summaries may not be
    cited or relied upon as they are not the official language of the division.
  Any discrepancy between the language in the summary and in the opinion
           should be resolved in favor of the language in the opinion.

                                                                   SUMMARY
                                                                 April 9, 2020

                                2020COA67

No. 19CA1671, (Various) in re Appraisal v. Anschutz Corp —
Corporations — Mergers and Sales — Dissenters’ Rights; Courts
and Court Procedures — Uniform Interstate Deposition and
Discovery Act — Issuance of Subpoena; Civil Procedure —
Discovery Scope and Limits

     This opinion addresses, for the first time in a published

opinion in Colorado, whether the intent and motives of a controlling

stockholder are relevant in an appraisal proceeding, where

Delaware Code Annotated title 8, section 262(h) (West 2019),

requires a Delaware court to determine the reliability of and weight

to give to the “deal price” in fixing the “fair value” of shares.

     Additionally, this opinion considers, for the first time in a

published opinion in Colorado, whether the Colorado Rules of Civil

Procedure allow us the incorporate the so called “apex doctrine”
into Colorado law, thus shifting the traditional burden of

persuasion under C.R.C.P. 26(c) to the party seeking a deposition.
COLORADO COURT OF APPEALS                                          2020COA67

Court of Appeals No. 19CA1671
City and County of Denver District Court No. 19CV287
Honorable Christopher J. Baumann, Judge

BlueMountain Credit Alternatives Master Fund L.P., BlueMountain Foinaven
Master Fund L.P., BlueMountain Fursan Fund L.P., BlueMountain Guadalupe
Peak Fund L.P., BlueMountain Kicking Horse Fund L.P., BlueMountain Logan
Opportunities Master Fund L.P., BlueMountain Montenver Master Fund SCA
SICA V-SIF, BlueMountain Summit Trading L.P., GKC Strategic Value Master
Fund LP, and GKC SV SMA I, LLC: In re Appraisal of Regal Entertainment
Group,

Petitioners-Appellants,

v.

Regal Entertainment Group, Anschutz Corporation, and Philip F. Anschutz,

Respondents-Appellees.

                          ORDER REVERSED AND CASE
                          REMANDED WITH DIRECTIONS

                                  Division A
                     Opinion by CHIEF JUDGE BERNARD
                     Martinez* and Davidson*, JJ., concur

                            Announced April 9, 2020

Ireland Stapleton Pryor & Pascoe, P.C., Mark E. Lacis, Lidiana Rios, Denver,
Colorado, for Petitioners-Appellants

Hogan Lovells US, LLP, Jessica Black Livingston, Denver, Colorado, for
Respondents-Appellees

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.
VI, § 5(3), and § 24-51-1105, C.R.S. 2019.
¶1    The petitioners in this case are BlueMountain Credit

 Alternatives Master Fund L.P., BlueMountain Foinaven Master

 Fund L.P., BlueMountain Fursan Fund L.P., BlueMountain

 Guadalupe Peak Fund L.P., BlueMountain Kicking Horse Fund L.P.,

 BlueMountain Logan Opportunities Master Fund L.P.,

 BlueMountain Montenver Master Fund SCA SICA V-SIF,

 BlueMountain Summit Trading L.P., GKC Strategic Value Master

 Fund LP, and GKC SV SMA I, LLC. We shall call them the “minority

 stockholders.”

¶2    The minority stockholders asked the trial court to compel

 Philip F. Anschutz, who is the founder and chief executive officer of

 the Anschutz Corporation, to comply with a deposition subpoena.

 (The Anschutz Corporation is also a party to this appeal.) The court

 denied their motion. The minority stockholders appealed. We

 reverse the trial court’s order and remand the case to the district

 court for further proceedings consistent with this opinion.

                           I.   Background

¶3    Regal Entertainment Group, which, among other things, owns

 and manages movie theaters throughout the United States, is a

 Delaware corporation. The Anschutz Corporation was Regal’s

                                   1
 controlling stockholder. The minority stockholders were

 noncontrolling, minority stockholders of Regal.

¶4    In February 2018, a British company called Cineworld Group

 plc acquired Regal in a transaction that we shall call “the merger.”

 The minority stockholders, contending that they did not receive fair

 value for their shares in Regal, dissented from the merger and

 sought appraisal of their shares in a statutory proceeding in the

 Delaware Court of Chancery.

¶5    To obtain information for the appraisal proceeding, the

 minority stockholders served a deposition subpoena on Mr.

 Anschutz. In doing so, they relied on section 13-90.5-103, C.R.S.

 2019, of the Uniform Interstate Depositions and Discovery Act, or

 the UIDDA.

¶6    Mr. Anschutz did not comply with the subpoena. So the

 minority stockholders filed a motion asking the trial court to order

 him to comply with it. They contended that, as the chief executive

 of the Anschutz Corporation, Mr. Anschutz was Regal’s controlling

 stockholder and, as a result, discovering why Mr. Anschutz sold his

 share of Regal was critical and relevant to the appraisal

 proceedings. More specifically, they informed the court that they

                                   2
 wanted to ask Mr. Anschutz about his motives and personal

 considerations for agreeing to the merger.

¶7    The trial court denied the motion, concluding that the

 questions the minority stockholders wanted to ask Mr. Anschutz in

 a deposition were not “relevant and necessary” to the Delaware

 appraisal case.

            II.    Enforcement of the Deposition Subpoena

                        A.   Standard of Review

¶8    We review a court’s decision to deny a motion to compel

 compliance with a subpoena for an abuse of discretion. Gateway

 Logistics, Inc. v. Smay, 2013 CO 25, ¶ 13. A court abuses its

 discretion if its decision is manifestly unreasonable, arbitrary, or

 unfair, or if it misapplies the law. Ferraro v. Frias Drywall, LLC,

 2019 COA 123, ¶ 10.

¶9    We will review de novo a trial court’s (1) decisions regarding

 choice of law, Mountain States Adjustment v. Cooke, 2016 COA 80,

 ¶ 13; and (2) interpretation of pertinent statutes, In re Marriage of

 Ciesluk, 113 P.3d 135, 141 (Colo. 2005).

                                    3
                             B.      Choice of Law

¶ 10   The UIDDA allows a party to “submit a foreign subpoena to

  the district court for the county in which discovery is sought to be

  conducted in [Colorado].” § 13-90.5-103(1). An application to the

  district court to enforce a subpoena issued under section 13-90.5-

  103 must comply with the rules or statutes of Colorado. § 13-90.5-

  106, C.R.S. 2019. More specifically, the procedural and evidentiary

  laws of Colorado govern this analysis. See § 13-90.5-106 cmt.

  (“Evidentiary issues that may arise, such as objections based on

  grounds such as relevance or privilege, are best decided in the

  discovery state under the laws of the discovery state (including its

  conflict of laws principles).”).

¶ 11   But, if Colorado law governs the process that must apply,

  what law governs the substantive legal issues that a court may have

  to decide? Colorado has adopted the general rule, as set forth in

  the restatement (Second) of Conflicts of Law, that the law of the

  state with the most “significant relationship” with the occurrence

  and the parties governs. AE, Inc. v. Goodyear Tire & Rubber Co.,

  168 P.3d 507, 509 (Colo. 2007). Once the state having the most

  significant relationship is identified, the law of that state is then

                                        4
  applied to resolve the issue. Wood Bros. Homes, Inc. v. Walker

  Adjustment Bureau, 198 Colo. 444, 447-48, 601 P.2d 1369, 1372

  (1979). “[T]he courts of a state, in cases where the laws of another

  state are involved, may and should take notice of the decisions of

  the highest courts in the latter jurisdiction upon the law so

  involved.” Sullivan v. German Nat’l Bank, 18 Colo. App. 99, 104, 70
P. 162, 164 (1902).

¶ 12   Because Regal was incorporated in Delaware, and the minority

  stockholders seek the enforcement of a subpoena for purposes of

  obtaining Mr. Anschutz’s testimony in connection with the

  appraisal proceedings in a Delaware court, we conclude that we

  should apply Delaware law to resolve substantive legal matters. See

  Great W. Producers Co-operative v. Great W. Unite Corp., 200 Colo.
180, 182 n.2, 613 P.2d 873, 875 n.2 (1980)(holding that the

  substantive law of Delaware applied because defendant corporation

  was incorporated under the laws of Delaware).

                        C.   Relevance of Discovery

¶ 13   The Colorado Rules of Civil Procedure govern the scope of

  permissible discovery in civil cases. C.R.C.P. 26(b)(1) states that

  “parties may obtain discovery regarding any matter, not privileged,

                                    5
  that is relevant to the claim or defense of any party and

  proportional to the needs of the case . . . . Information within the

  scope of discovery need not be admissible in evidence to be

  discoverable.”

¶ 14   The concept of relevance for discovery purposes is different

  than the concept of relevance of evidence at trial. DA Mountain

  Rentals, LLC v. The Lodge at Lionshead Phase III Condo. Ass’n, 2016
COA 141, ¶ 57. “[D]iscovery rules should be construed liberally to

  effectuate the full extent of their truth-seeking purpose” and “[i]n

  close cases, the balance must be struck in favor of allowing

  discovery.” Antero Res. Corp. v. Strudley, 2015 CO 26, ¶ 32

  (quoting Direct Sales Tire Co. v. Dist. Court, 686 P.2d 1316, 1321

  (Colo. 1984)).

                   D.   Delaware Appraisal Proceedings

¶ 15   Under Delaware law, the statutory appraisal proceeding was

  created as a remedy for minority stockholders who view the sale

  price of a corporation as inadequate to seek “an independent

  judicial determination of the fair value of their shares.” Dell, Inc. v.

  Magnetar Glob. Event Driven Master Fund Ltd, 177 A.3d 1, 19 (Del.

  2017) (citation omitted). There is one issue in such an appraisal

                                      6
  trial: “the value of the dissenting stockholder’s stock.” Id. (citation

  omitted).

¶ 16   The Delaware Court of Chancery’s task is to “determine the

  fair value of the shares.” Del. Code Ann. tit. 8, § 262(h) (West

  2019). To do so, the court “shall take into account all relevant

  factors.” Id. The examination requires consideration of “all factors

  and elements which reasonably might enter into the fixing of value.”

  Tri-Cont’l Corp. v. Battye, 74 A.2d 71, 72 (Del. 1950).

                 1.    Factors in Determining Fair Value

¶ 17   Factors which a Delaware court must consider in determining

  fair value include market value, asset value, dividends, earning

  prospects, the nature of the enterprise, and any other facts that

  were known or that could be ascertained as of the date of merger

  and that throw any light on the future prospects of the merged

  corporation. Id. (holding that these factors are not only pertinent to

  an inquiry as to the value of the dissenting stockholders’ interest

  but must be considered by the agency fixing the value).

  Additionally, “the deal price as a market indicator of fair value in

  appraisal cases conforms to [the Delaware court’s] use of

  market-tested prices.” Verition Partners Master Fund Ltd. v. Aruba

                                     7
  Networks, Inc., 210 A.3d 128, 135 n.41 (Del. 2019); see also Dell,
177 A.3d at 19 (holding that relevant factors in determining fair

  value include the deal price).

¶ 18   The court may not adopt an “either-or” approach at the outset,

  thereby relying exclusively on selected factors or accepting

  uncritically the valuation of one party. See In re Appraisal of

  Metromedia Int’l Grp., Inc., 971 A.2d 893, 899-900 (Del. Ch. 2009),

  reargument granted, 2009 WL 1299116 (Del. Ch. 2009). It is the

  court’s duty to determine the core issue of fair value on the

  appraisal date. Id.; see also Gonsalves v. Straight Arrow

  Publishers, Inc., 701 A.2d 357, 361 (Del. 1997)(noting the court’s

  responsibility to “independently determine the value of the shares

  that are the subject of the appraisal action”). After an analysis of

  all relevant factors, the court may then determine “that a single

  valuation metric is the most reliable evidence of fair value and that

  giving weight to another factor will do nothing but distort that best

  estimate.” DFC Glob. Corp. v. Muirfield Value Partners, L.P., 172
A.3d 346, 388 (Del. 2017).

                                     8
              2.   Reliability and Weight of the “Deal Price”

¶ 19   As the minority stockholders correctly note, Delaware courts

  must consider all relevant factors, including the deal price, to

  decide whether a corporate sale was for fair value. See Aruba

  Networks, 210 A.3d at 135 n.41; Dell, 177 A.3d at 19. After an

  analysis of all relevant factors, the court may then determine the

  reliability of, and weight to attribute to, each factor, including the

  reliability and weight to be given to the deal price. See DFC Glob.,
172 A.3d at 388.

¶ 20   In recent appraisal decisions that have examined the reliability

  of a sale process, the Delaware Supreme Court has cited certain

  “objective indicia” suggesting that “the deal price was a fair price.”

  Dell, 177 A.3d at 28; accord DFC Glob., 172 A.3d at 376. But the

  presence of objective indicia does not establish a presumption in

  favor of the deal price, and the Delaware Supreme Court has

  rejected requests for the adoption of a presumption that the deal

  price reflects fair value if certain preconditions are met. Dell, 177
A.3d at 21. Rather, the indicia are merely a starting point for the

  analysis of whether the deal price was fair. But “[t]he fact that a

  transaction price was forged in the crucible of objective market

                                     9
  reality . . . is viewed as strong evidence that the price is fair.” Van

  de Walle v. Unimation, Inc., No. Civ. A. 7046, 1991 WL 29303, at *17

  (Del. Ch. Mar. 7, 1991)(unpublished opinion).

¶ 21   When deciding what weight to give a deal price and whether it

  was reliable, see DFC Glob., 172 A.3d at 388, Delaware courts have

  considered

        whether a merger was an arm’s-length transaction with a

          third party, see id. at 349 (citing the fact that “the company

          was purchased by a third party in an arm’s length sale” as a

          factor supporting fairness of the deal price);

        the absence of explicit or implicit collusion, whether among

          bidders or between the seller and a particular bidder, see

          M.P.M. Enters., Inc. v. Gilbert, 731 A.2d 790, 797 (Del.

          1999)(“A merger price resulting from arms-length

          negotiations where there are no claims of collusion is a very

          strong indication of fair value.”);

        the possibility that management will favor a particular

          bidder for self-interested reasons, which is a common risk

          in corporate sale processes, see Huff Fund Inv. P’ship v.

          CKx, Inc., No. CV 6844-VCG, 2013 WL 5878807, at *13

                                     10
  (Del. Ch. Nov. 1, 2013)(unpublished opinion)(giving

  exclusive weight to a sales process where “[t]he record and

  the trial testimony support a conclusion that the process by

  which [the company] was marketed to potential buyers was

  thorough, effective, and free from any spectre of self-interest

  or disloyalty”), aff’d, No. 348,2014, 2015 WL 631586 (Del.

  2015)(unpublished table decision);

 whether the transaction involves a controlling stockholder,

  see Dell, 177 A.3d at 25, 30 (holding that a “market is more

  likely efficient . . . if it has many stockholders [and] no

  controlling stockholder” and that “this was not a buyout led

  by a controlling stockholder” as a factor supporting fairness

  of the deal price);

 the existence of meaningful competition among multiple

  bidders during the pre-signing phase, see Aruba Networks,
210 A.3d at 136 (holding that where there was an open

  chance for buyers to bid, the level of competition was

  enough to support the reliability of the deal price); and

 whether there were improper motives behind the negotiation

  of the transaction, see Cinerama, Inc. v. Technicolor, Inc.,

                             11
          663 A.2d 1156, 1172 (Del. 1995)(affirming the lower court’s

          finding that the evidence did not support an “improper

          motive” on the part of the board in negotiating a good

          transaction for the stockholders); In re Dollar Thrifty

          S’holder Litig., 14 A.3d 573, 577 (Del. Ch. 2010)(crediting

          the record that showed the board “had no conflict of interest

          that gave them a motive to do other than the right thing” in

          their approach to value maximization).

¶ 22   In considering these factors in the determination of the

  reliability of the deal price, it is worth noting that Delaware law

  presumes that investors act to maximize the value of their own

  investments. Unitrin, Inc. v. Am. Gen. Corp., 651 A.2d 1361, 1380-

  81 (Del. 1995). “When a large stockholder supports a sales process

  and receives the same per-share consideration as every other

  stockholder, that is ordinarily evidence of fairness, not of the

  opposite . . . .” Iroquois Master Fund Ltd. v. Answers Corp., 105
A.3d 989, 2014 WL 7010777, at *1 n.1 (Del. 2014) (unpublished

  table decision).

¶ 23   However, Delaware law also recognizes that, in some

  scenarios, circumstances may cause the interests of investors who

                                     12
hold common stock to diverge. For example, desire for liquidity has

been recognized as a benefit that “may lead directors to breach their

fiduciary duties” and stockholder directors may be found to have

breached their duty of loyalty if a “desire to gain liquidity . . .

caused them to manipulate the sales process” and subordinate the

best interests of the corporation and the stockholders as a whole.

In re Answers Corp. S’holder Litig., No. Civ. A. 6170-VCN, 2012 WL
1253072, at *7 (Del. Ch. 2012)(unpublished opinion)(quoting N.J.

Carpenters Pension Fund v. Infogroup, Inc., No. Civ. A. 5334-VCN,

2011 WL 4825888, at *9 (Del. Ch. Sept. 30, 2011)(denying a motion

to dismiss where the plaintiff alleged that the director, who was also

a large stockholder, sacrificed value in a sale because he needed

liquidity to satisfy personal debts and fund a new venture)).

Additionally, “certain institutional investors may be happy to take a

sizeable merger-generated gain on a stock for quarterly reporting

purposes, or to offset other losses, even if that gain is not

representative of what the company should have yielded in a

genuinely competitive sales process.” Glob. GT LP v. Golden

Telecom, Inc., 993 A.2d 497, 509 (Del. Ch.), aff’d, 11 A.3d 214 (Del.

2010).

                                    13
                              E.    Analysis

¶ 24   C.R.C.P. 26(b)(1) states that “parties may obtain discovery

  regarding any matter, not privileged, that is relevant to the claim or

  defense of any party and proportional to the needs of the case . . . .

  Information within the scope of discovery need not be admissible in

  evidence to be discoverable.”

¶ 25   The scope of our evaluation is limited to whether the evidence

  sought by the minority stockholders is relevant to their claim, and

  would allow the Delaware court to evaluate the reliability of the deal

  price. See C.R.C.P 26(b)(1). Given Colorado’s liberal stance on

  discovery, and that Mr. Anschutz’s motive, intent, and personal

  considerations for divesting his Regal shares would allow a

  Delaware court to evaluate the reliability of, and weight to attribute

  to, the deal price, we hold, for the following reasons, that Mr.

  Anschutz’s testimony is relevant and discoverable. See id.

¶ 26   The minority stockholders allege that the deal price in this

  case is an unreliable indicator of fair value and that the Delaware

  court should not give it weight in the appraisal case. They state

  this is so because Mr. Anschutz may have accepted “less than fair

  value in order to accomplish other objectives.” They contend that, if

                                    14
  evidence showed that he was willing to take less money for his

  Regal shares “so that he could obtain a sale transaction that would

  accomplish personal liquidity, tax, estate planning or other

  objectives,” then a Delaware court might conclude that the deal

  price is not a reliable indicator of fair value.

¶ 27   As noted above, when evaluating the reliability of the deal

  price, Delaware courts have considered whether the merger was an

  arm’s-length transaction, whether there was collusion, whether the

  transaction involved a controlling stockholder, and whether there

  was improper motive in the negotiation of the transaction. See DFC

  Glob., 172 A.3d at 349; Dell, 177 A.3d at 25, 30; M.P.M. Enters.,
731 A.2d at 797; Cinerama, 663 A.2d at 1172. Mr. Anschutz’s

  testimony could shed light on whether he had any improper motive

  in negotiating a fair transaction on the minority stockholders’

  behalf, whether he had a conflict of interest in his approach to

  value maximization on their behalf, or whether the merger was an

  arm’s-length transaction. See Cinerama, 663 A.2d at 1172 (holding

  that the evidence did not support an “improper motive” in the

  negotiation of a good transaction for the stockholders); Dollar

  Thrifty, 14 A.3d at 577 (holding that the evidence showed that the

                                      15
  board did not have a conflict of interest that gave them a motive to

  avoid achieving value maximization for the stockholders). The

  testimony that the minority stockholders seek could persuade a

  Delaware court to give less weight to the deal price and more weight

  to other factors in the determination of the fair value of the Regal

  shares. In other words, the minority stockholders have

  demonstrated that Mr. Anschutz has knowledge of facts that are

  relevant to the resolution of this case.

                           III.   Apex Doctrine

¶ 28   Mr. Anschutz contends that, even if his testimony is relevant

  to the appraisal proceedings, we should affirm the trial court’s order

  because the minority stockholders’ “subpoena violated the apex

  doctrine.” At its most general, the apex doctrine shields high-level

  corporate officers from depositions. Zimmerman v. Al Jazeera Am.,

  LLC, 329 F.R.D. 1, 6 (D.D.C. 2018). The doctrine is rooted in Fed.

  R. Civ. P. 26(c)(1), which provides that a court may, upon motion of

  a party or person from whom discovery is sought and “for good

  cause, issue an order to protect a party or person from annoyance,

  embarrassment, oppression, or undue burden or expense.” We

  disagree with Mr. Anschutz’s contention.

                                     16
  A.   Standard of Review, Preservation, and General Legal Principles

¶ 29   Although the trial court did not rule on the applicability of the

  apex doctrine, the issue was properly preserved for appellate review

  because Mr. Anschutz raised its applicability in pleadings that he

  had filed. The court therefore had an opportunity to rule on it.

  Grant Bros. Ranch, LLC v. Antero Res. Piceance Corp., 2016 COA
178, ¶ 11 (“All that is needed to preserve an issue for appeal is for

  the issue to be brought to the district court's attention so that the

  court has an opportunity to rule on it.”).

¶ 30   When interpreting the Colorado Rules, we rely on various

  interpretive aids, including the Federal Rules and federal precedent

  interpreting Federal Rules. Garcia v. Schneider Energy Servs., Inc.,

  2012 CO 62, ¶ 7; see also Garrigan v. Bowen, 243 P.3d 231, 235

  (Colo. 2010)(“Because the Colorado Rules of Civil Procedure are

  patterned on the federal rules, we may also look to the federal rules

  and decisions for guidance.”).

¶ 31   Colorado has an analogous rule to Fed. R. Civ. P. 26(c)(1).

  Like the federal rule, the Colorado rule permits a trial court to issue

  a protective order upon a showing of good cause. See C.R.C.P.

  26(c)(“[F]or good cause shown, the court may make any order which

                                    17
  justice requires to protect a party or person from annoyance,

  embarrassment, oppression, or undue burden or expense.”). But

  the parties have not cited, and we have not found, any published

  Colorado appellate case that has generally applied the apex

  doctrine, or, more specifically, decided whether a trial court may

  anchor a finding of good cause to issue a protective order primarily

  on an individual’s status as a “high ranking and important

  executive.” So we must now decide whether we should apply

  special discovery rules unique to high-ranking executives to this

  case. For the reasons we discuss below, we conclude that we

  should not do so. Rather, we determine that the existing discovery

  rules, including the protective order provisions of C.R.C.P. 26(c),

  provide Mr. Anschutz with sufficient protection from any

  inappropriate or improper discovery requests.

                  B.   Application of the Apex Doctrine

¶ 32   Some federal courts developed the apex doctrine because they

  decided that “depositions of high-level officers severely burdens

  those officers and the entities they represent, and that adversaries

  might use this severe burden to their unfair advantage.” United

  States ex rel. Galmines v. Novartis Pharm. Corp., No. Civ. 06-3213,

                                    18
  2015 WL 4973626, at *1 (E.D. Pa. Aug. 20, 2015); see also EchoStar

  Satellite, LLC v. Splash Media Partners, L.P., No. 07-cv-02611-PAB-

  BNB, 2009 WL 1328226, at *2 (D. Colo. May 11, 2009)(“[H]igh

  ranking and important executives ‘can be easily subjected to

  unwarranted harassment and abuse’ and ‘have a right to be

  protected, and the courts have a duty to recognize [their]

  vulnerability.”)(citation omitted).

¶ 33   The doctrine provides that, before a party may depose a

  high-level corporate executive, such party must show that (1) the

  deponent has unique, first-hand, nonrepetitive knowledge of the

  facts at issue in the case; and (2) other, less burdensome avenues

  for obtaining the information sought have been exhausted. In re

  Google Litig., No. C 08-03172 RMW PSG, 2011 WL 4985279, at *2

  (N.D. Cal. Oct. 19, 2011); Liberty Mut. Ins. Co. v. Superior Court, 13
Cal. Rptr. 2d 363, 365 (Cal. Ct. App. 1992); Alberto v. Toyota Motor

  Corp., 796 N.W.2d 490, 495 (Mich. Ct. App. 2010).

¶ 34   An essential component of the doctrine is that the burden of

  proof is shifted to the party seeking the corporate executive’s

  deposition. See, e.g., Sun Capital Partners, Inc. v. Twin City Fire Ins.

  Co., 310 F.R.D. 523, 527 (S.D. Fla. 2015)(“The party seeking the

                                        19
  deposition of the high-ranking official has the burden to show that

  the deposition is necessary.”); Tierra Blanca Ranch High Country

  Youth Program v. Gonzales, 329 F.R.D. 694, 699 (D.N.M.

  2019)(quashing subpoenas where the plaintiffs did not show that

  the executive possessed “‘unique personal knowledge’ of facts

  relevant to any material issue”). “The ‘apex’ doctrine exists in

  tension with the otherwise broad allowance for discovery of party

  witnesses under the federal rules.” Apple Inc. v. Samsung Elec. Co.,

  Ltd, 282 F.R.D. 259, 263 (N.D. Cal. 2012).

¶ 35   But the apex doctrine does not rule the roost in all federal

  courts. Some of them have rejected the doctrine altogether, while

  others have tried to harmonize the doctrine’s principles with Fed. R.

  Civ. P. 26. See, e.g., Novartis Pharm., 2015 WL 4973626, at *2

  (holding that “[t]he apex doctrine does not represent an exception to

  the rule that a party seeking to quash a subpoena bears the ‘heavy

  burden’ of demonstrating that the subpoena represents an undue

  burden,” but, rather, the doctrine should be used as a tool for

  guiding the court's analysis in determining whether to limit

  discovery); Scott v. Chipotle Mexican Grill, Inc., 306 F.R.D. 120, 122

  (S.D.N.Y. 2015)(stating that, even in apex doctrine scenarios, the

                                    20
  plaintiff bears no burden to show that the deponent has special

  knowledge); Van Den Eng v. Coleman Co., No. 05-MC-109-WEB-

  DWB, 2005 WL 3776352, at *2 (D. Kan. Oct. 21, 2005)(holding that

  high-level executives “are treated under the same standards as any

  other protective order, while taking into consideration special

  factors that may apply to such officials”).

¶ 36   And, in federal courts that have adopted some version of the

  doctrine, the courts are split on which party bears the ultimate

  burden of persuasion when a high-level executive invokes the apex

  doctrine. Tierra Blanca, 329 F.R.D. at 697. As a result, a hybrid,

  burden-shifting version of the doctrine has developed, requiring an

  initial showing of unique personal knowledge by the party seeking

  discovery, but then placing “the ultimate burden of persuasion” on

  the executive to demonstrate that he or she in fact has no unique

  personal knowledge. Naylor Farms, Inc. v. Anadarko OGC Co., No.

  11-CV-01528-REB-KLM, 2011 WL 2535067, at *2 (D. Colo. June

  27, 2011)(citing EchoStar, 2009 WL 1328226, at *2).

¶ 37   Our decision is informed by a trend. As we have just

  observed, federal courts do not uniformly follow the apex doctrine.

  And a growing number of state courts, including those whose rules

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of civil procedure, like ours, are modeled on the federal rules, have

rejected it. See Netscout Sys., Inc. v. Gartner, Inc., No. (FS1)

TCV146022988S, 2016 WL 5339454, at *6 (Conn. Super. Ct. Aug.

22, 2016)(unpublished opinion)(holding that the apex doctrine was

incompatible with Connecticut law to the extent that it shifted the

burden of showing good cause); Citigroup Inc. v. Holtsberg, 915 So.
2d 1265, 1269 (Fla. Dist. Ct. App. 2005)(declining to apply the apex

doctrine where Florida’s discovery rules did not contain a

requirement that the party seeking deposition must first show that

the high-level executive has unique or superior knowledge); State ex

rel. Ford Motor Co. v. Messina, 71 S.W.3d 602, 607 (Mo.

2002)(declining to adopt the apex doctrine and holding that the

deposition of high-level executives should proceed in accordance

with the Missouri rules governing discovery); Thomson v. Zillow,

Inc., 32 N.Y.S.3d 455, 459 (N.Y. Sup. Ct. 2016)(declining to extend

discovery rules for executives where respondents had shown that

they seek information which was material and necessary to their

defense); Bradshaw v. Maiden, No. 14 CVS 14445, 2017 WL
1238823, at *5 (N.C. Super. Ct. Mar. 31, 2017)(unpublished

opinion)(declining to apply the apex doctrine, and restricting the

                                   22
  deposition of an executive under the North Carolina Rules of Civil

  Procedure); Crest Infiniti, II, LP v. Swinton, 174 P.3d 996, 1004

  (Okla. 2007)(declining to adopt the apex doctrine where it shifted

  the burden to the party seeking discovery, because, in Oklahoma,

  “the burden of showing ‘good cause’ is statutorily placed on the

  party objecting to discovery”). This trend signals to us that the apex

  doctrine’s influence has reached its zenith and has begun to

  decline.

¶ 38   In addition to the doctrine’s waning influence, which

  undercuts Mr. Anschutz’s request to apply it to this case, we

  conclude that it is inconsistent with Colorado law.

¶ 39   As we explained, the doctrine presumes that “apex” executives

  should not be deposed unless the party requesting the deposition

  can establish reasons why the doctrine should not bar the

  deposition. But, much like the cases in our sister states that we

  cited above, Colorado law flips the script because it presumes that

  such executives should be deposed unless they can show good

  cause why the deposition should not be held. See C.R.C.P. 26(c).

¶ 40   The scope of discovery is broad under the Colorado Rules of

  Civil Procedure. Williams v. Dist. Court, 866 P.2d 908, 911 (Colo.

                                    23
  1993). “[A]ll relevant, non-privileged information should be

  discoverable unless it would cause annoyance, embarrassment,

  oppression, or undue burden or expense.” Hadley v. Moffat Cty.

  Sch. Dist. RE-1, 681 P.2d 938, 945 (Colo. 1984). “Discovery rules

  should be accorded a broad and liberal interpretation in order to

  effect their purpose of adequately informing the litigants of the facts

  giving rise to a claim or defense.” Id. And, as Justice White

  recognized in the plurality opinion in Branzburg v. Hayes, 408 U.S.
665, 690 n.29 (1972)(quoting 8 J. Wigmore, Evidence § 2192

  (McNaughton rev. 1961)), “everyone is obligated to testify when

  properly summoned,” and “derogations” to this “positive general

  rule” are “obstacle[s] to the administration of justice.”

¶ 41   None of our civil discovery rules, including C.R.C.P. 26, refer

  to the apex doctrine. Mr. Anschutz’s request that we apply it to this

  case is therefore, at its core, an invitation that we amend the Rules

  of Civil Procedure. And that we cannot do because the supreme

  court’s power to adopt and to amend such rules is exclusive. See

  Colo. Const. art VI, § 21 (“The supreme court shall . . . make and

  promulgate rules governing practice and procedure in civil . . .

                                     24
  cases.”); Gold Star Sausage Co. v. Kempf, 653 P.2d 397, 400 (Colo.

  1982)(same).

¶ 42   But our conclusion does not leave Mr. Anschutz without a

  remedy. Our supreme court has recognized that the “broad

  discovery permitted by C.R.C.P. 26(b)(1) may lead to discovery

  abuses,” Williams, 866 P.2d at 912, including, conceivably, the sort

  of abuses that the apex doctrine is designed to prevent. But there

  are ways to protect against such abuses. “C.R.C.P. 26(c) allows the

  trial court to issue protective orders as justice requires ‘to protect a

  party . . . from annoyance, embarrassment, oppression, or undue

  burden or expense.’” Id. The party seeking protection from

  discovery bears the burden to establish good cause to obtain relief.

  See C.R.C.P. 26(c); Williams, 866 P.2d at 912.

¶ 43   So, in this case, if Mr. Anschutz can establish such good

  cause, the trial court could issue a protective order. In this regard,

  Mr. Anschutz could, for example, ask the trial court to consider “the

  possibility of harassment and the potential disruption of business”

  that his deposition might cause. Gen. Star Indem. Co. v. Platinum

  Indem. Ltd., 210 F.R.D. 80, 83 (S.D.N.Y. 2002).

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¶ 44   In reaching the conclusion that we will not apply the apex

  doctrine to this case, we note the following:

        The minority stockholders have alleged that Mr. Anschutz’s

          testimony is relevant to the question of whether he was

          willing to take less money for his Regal shares “so that he

          could obtain a sale transaction that would accomplish

          personal liquidity, tax, estate planning or other objectives.”

          Indeed, he may be the best possible witness to testify about

          his intent.

        Mr. Anschutz does not deny that he had knowledge of the

          unique and relevant facts. See Naylor Farms, 2011 WL
2535067, at *4 (holding that a declaration sworn under

          penalty of perjury where executive unequivocally disavows

          any unique personal knowledge is competent evidence that

          may be considered by the court); EchoStar, 2009 WL
1328226, at *3 (holding that executive had satisfied his

          burden and was entitled to a protective order precluding his

          deposition where he provided an affidavit establishing that

          he had “no personal knowledge of the circumstances

          surrounding” the agreement in dispute).

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¶ 45   We therefore reverse the trial court order denying the minority

  stockholders’ motion to compel Mr. Anschutz to testify at a

  deposition. We remand the case to the trial court to grant the

  minority stockholders’ motion to compel him to testify at a

  deposition unless, after an evidentiary hearing, the court

  determines that it should issue a protective order under C.R.C.P.

  26(c).

       JUSTICE MARTINEZ and JUDGE DAVIDSON concur.

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