Opinion
No. 03 C 4065.
July 15, 2003.
ORDER
The Motion relates to litigation filed by LaSalle, in its capacity as Trustee of a REMIC, against Nomura Asset Capital Corp. ("Nomura") and Nomura's affiliate, Asset Securitization Corporation ("ASC"), which is pending in the Southern District of New York (the "Litigation"). The Litigation concerns as $50 million loan made by Nomura to HPCH, and subsequently transferred to LaSalle as Trustee of the REMIC trust.
Nomura loaned HPCH $50 million, secured by a guarantee from Doctors Hospital. Nomura subsequently transferred the $50 million loan, along with other loans, to LaSalle, as Trustee of the REMIC Trust. When Doctors Hospital filed for bankruptcy protection and ceased making lease payments to HPCH in 2000, HPCH defaulted on the $50 million loan. LaSalle sued Nomura and ASC, alleging that Nomura and ASC either failed to properly investigate the borrower and the guarantor, or that the Defendants knew that the $50 million loan was not properly secured.
During discovery, LaSalle learned that Dr. James Desnick was the majority shareholder and/or managing partner of several entities that were involved with HPCH, and the $50 million Nomura Loan. Specifically, Dr. Desnick owned 100% of HP Membership, Inc, which owned 1% of HPCH and was the managing member of HPCH. In addition, Dr. Desnick owned 100% of Stoney Island Ventures, Inc., which was the managing partner of HPCH Partners LP, which in turn owned 99% of HPCH. Dr. Desnick also owned 100% of the stock of Doctors Hospital.
On January 29, 2003, LaSalle deposed Dr. Desnick in his individual capacity, regarding his participation in obtaining the $50 million loan. Subsequently, LaSalle subpoenaed HPCH, seeking to depose its designated Rule 30(b)(6) representative. Only then did HPCH identify Dr. Desnick as its designated representative.-almost six months after Dr. Desnick's individual deposition was taken.
HPCH seeks to quash the subpoena pursuant to Federal Rule of Civil Procedure 45(c)(3)(A)(iv), which provides that "On timely motion, the court by which a subpoena was issued shall quash or modify the subpoena if it . . . subjects a person to undue burden." HPCH claims that the deposition would be duplicative of the day-long deposition of Dr. James Desnick, which LaSalle took on January 29, 2003, and would be unduly burdensome. A party seeking to quash a subpoena bears the burden of proving that the subpoena is unduly burdensome. Plant Genetic Sys., N.V. v. Northrup King Co. Inc., 6 F. Supp.2d 859, 862 (E.D.Mo. 1998). HPCH correctly notes that the court in Novartis Pharmaceuticals Corp v. Abbott Labs prohibited a Rule 30(b)(6) deposition of a corporation through its designated representative, because the representative had already been deposed in his individual capacity. 203 F.R.D. 159 (Del. 2001). The case is readily distinguishable, however, because the corporation in Novartis agreed to be bound by the individual's deposition testimony, whereas HPCH has refused to be bound by Dr. Desnick's testimony. Id. at 162. HPCH also claims that LaSalle cannot satisfy the test set forth in Block v. Abbott Labs, Inc., 2001 WL 1539159, at *2 (N.D.Ill. 2001), which identifies the circumstances warranting deposing a witness for a second time. Block is also distinguishable, however, because LaSalle is seeking to depose HPCH, a distinct corporate entity, see Pacific Mutual Life Ins. Co. v. American Nat'l Bank and Trust Co. of Chicago, 649 F. Supp. 281, 287-88 (N.D.Ill. 1986), via their designated representative Dr. Desnick; LaSalle is not seeking to redepose Dr. Desnick in his individual capacity. Even if the Court were to ignore this distinction, the Court finds that LaSalle would satisfy the Block test: 1) neither Dr. Desnick nor HPCH, both central actors in the events giving rise to this lawsuit, have answered LaSalle's deposition questions on the record about HPCH's participation in and knowledge of the events leading up to the $500 million loan; 2) as the borrower, HPCH has relevant knowledge that it uniquely possesses; and 3) HPCH has not identified, nor is the Court aware of, less burdensome avenues for obtaining the desired information. Id. In conclusion, the Court finds that HPCH has not demonstrated that making Dr. Desnick, as HPCH's designated representative, available for a deposition is unduly burdensome. Therefore, the Court denies HPCH's Motion to Quash.