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TELEPHONE SYSTEMS v. CECIL

United States District Court, S.D. New York


January 7, 2004.

TELEPHONE SYSTEMS, et al., Plaintiffs, -against- MICHAEL CECIL, et al., Defendants

The opinion of the court was delivered by: RONALD ELLIS, Magistrate Judge

MEMORANDUM OPINION AND ORDER

Defendants Stuart Bentham and Michael Cecil have filed a motion to compel the depositions of three alleged directors, officers, or managing agents of plaintiff Afghan Wireless Communications Company ("AWCC') as representatives of the Afghanistan — based corporation. Plaintiffs Telephone Systems International, Inc. and AWCC assert that these three individuals, Abdul Rahim Saidjan, Mohammad Masoom Stanekzai, and Sami Wali, are not currently members of AWCC's Board of Directors, and that they bear no other relationship to the corporation that would require their production. For the reasons discussed below, defendants' application is DENIED.

Rule 30(b)(1) of the Federal Rules of Civil Procedure permits a party to compel the deposition of a specific officer, director, or managing agent of a corporation by a notice of deposition. Dubai Islamic Bank v. Citibank, N.A., 99 Civ. 1930, 2002 U.S. Dist. LEXIS 9794. *5-6 (S.D.N.Y. May 28, 2002) See generally 8A Charles Alan Wright, Arthur R. Miller, Richard L. Marcus, Federal Practice and Procedure § 2103 (2d ed. 1994) Defendants Bentham and Cecil claim that Saidjan and wali are current members of the Board of Directors. Page 2 Memorandum of Law in Support of Cecil and Bentham's Motion to Compel ("Defendants' Mem. of Law") at 7, or in the alternative, that they are managing agents of AWCC, and thus are subject to deposition by notice. Reply Memorandum of Law in Further Support of Cecil and Bentham's Motion to Compel ("Defendants' Reply Mem. of Law") at 5. As evidence of Saidjan and Wall's status as directors, defendants assert that these individuals attended various board meetings up to 2002, see Defendants' Mem. of Law at 8, and that they told defendant Bentham in 2003 that they were still directors. See Affidavit of Stuart Bentham at 3. Plaintiffs state, however, that a new roster of board members was elected in May 2003 that does not include any of the three disputed individuals. See Plaintiffs' Memorandum of Law in Opposition to Defendants' Motion to Compel ("Plaintiffs' Mem. of Law") at 3-4; Declaration of Amin Ramin at 3, Exh. A. On the basis of an affidavit by Abdul Rahman Rahimghiyasa, an attorney authorized to practice law in Afghanistan, defendants Bentham and Cecil counter that this May 2003 election of new board members was illegal under Afghan law, and that Saidjan and Wall remain directors of the board. See Reply Affirmation of Abdul Rahman Rahimghiyasa at 3-4. The Court finds that the opinion expressed in Rahimghiyasa's affidavit is not sufficient to establish Afghan law on the subject of whether these individuals are board members.

  Additionally, defendants Bentham and Cecil claim that managing agent status can be conferred by the Court when a corporation purposefully directs a director to leave to frustrate discovery. See Defendants' Reply Mem. of Law at 5-6. Even if this were legally permissible, defendants have not provided sufficient evidence that the AWCC purposefully directed such action. Defendants' assertion appears to rest chiefly on the affirmation by Rahimghiyasa regarding Afghan law, which the Court has already found legally insufficient. Defendants' claim Page 3 regarding managing agent status is therefore similarly unsubstantiated. The burden of determining the status of a witness is on the examining party, see Dubai, 2002 U.S. LEXIS, at *11 (citing Sugarhill Records Ltd, v. Motown Record Corp., 105 F.R.D 166, 170 (S.D.N.Y. 1985)), and thus defendants' motion to compel the depositions of Saidjan and Wali is DENIED.

  In addition, defendants Bentham and Cecil assert that Stanekzai, the current Minister of Communications of Afghanistan, is a director, officer, or managing agent of the AWCC, and is therefore subject to deposition by notice. See Defendants' Mem. of Law at 10; Defendants' Reply Mem. of Law at 7-8. Defendants claim that according to the by-laws of the AWCC, the Minister of Communications is an honorary chairman. See Defendants' Mem. of Law at 10; Defendants' Reply Mem. of Law at 7-8; Reply Affidavit of Stuart Bentham at 7. They allege that Stanekzai provides "significant input into running and making important decisions for AWCC," see Defendants" Reply Mem. of Law at 7, that he was present at a meeting in May 2003 where the new roster of board members was nominated and approved, that he engaged in discussion at that meeting about a project in contention, and that he has knowledge of the current lawsuit brought by plaintiffs. Id. at 7-8. Plaintiffs concede that the Minister of Communications possesses an equity interest in the AWCC, but appear to argue that this relationship is not equivalent to that of a director, officer, or managing agent. See Plaintiffs' Mem. of Law at 5. Apart from the legally insufficient affidavit by Rahimghiyasa regarding Afghan law, defendants have not included any evidence or discussion to demonstrate that an "honorary chairman" is tantamount to a director or actual officer of the corporation. Similarly, defendants' assertions regarding Stanekzai's role in AWCC, even if taken as true, cannot sufficiently establish that he is a "managing agent." This district has employed several factors to determine whether a witness is Page 4 a managing agent, including 1) whether the individual is invested with general powers allowing him or her to exercise judgment and discretion in corporate matters; 2) whether any person is employed by the corporation in a position of higher authority than the designated individual; 3) the general responsibilities of the individual respecting the matters involved in the litigation; and 4) whether the individual can be expected to identify with the interests of the corporation. See United States v. Afram Lines (USA), Ltd., 159 F.R.D. 408, 413 (S.D.N.Y. 1994)(noting a total of five factors for determining managing agent status); Sugarhill Records, 105 F.R.D. at 170. Defendants, who presumably have advanced knowledge of the corporation's inner workings as past board members, have simply failed to bring forth adequate evidence to support a finding that Stanekzai is a managing agent. Because defendants have not met their burden, their motion to compel the deposition of Stanekzai is also DENIED.

  Pursuant to this order, defendants' additional application for a protective order scheduling the depositions of defendants Bentham and Cecil in close proximity to those of Saidjan, Stanekzai, and Wali is DENIED.

  SO ORDERED

20040107

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