Webb v. Ethicon Endo-Surgery, Court Addresses Proportionality in Discovery, Observes that Party’s Recordkeeping System Requiring it to Incur Heavy Expenditures Does Not Prevent Disclosure of Discoverable Information
In this product liability case, the parties disputed the scope of discovery ordered by Magistrate Judge Jeanne J. Graham.
On July 29, 2009, the Plaintiff, Susan Webb (“Webb”), underwent surgery during which the surgeon used a TX60B disposable surgical stapler manufactured by Ethicon. Webb alleged that the stapler malfunctioned which required the surgeon to hand suture the incision. Subsequently, Webb suffered a postoperative leak at the surgical site, leading to hospitalization, an additional surgery, and permanent health problems. Webb filed suit and asserted claims for product liability, negligence with respect to manufacturing, and breach of warranty of merchantability claims against the Defendant, Ethicon Endo-Surgery, Inc. (“Ethicon”).
After extensive discovery, the parties sought the Court’s direction as to their disputes about the number and scope of document requests, and the location of the depositions of Ethicon’s officers and representatives. In an August 8, 2014 order, the Magistrate Judge limited the scope of Webb’s discovery requests to surgical staplers in the TX line. Explaining the limit in the scope, the Magistrate Judge noted that the TX60B was used in Webb’s surgery and items outside the TX line appeared significantly different. The Magistrate Judge denied Ethicon’s request for a discovery scope more narrow than the full line of TX surgical staplers. Both parties objected to the discovery scope in the August 8th order, with Ethicon seeking to limit the discovery to the TX60B stapler and Webb seeking discovery on Ethicon’s entire line of linear staplers.
In addition to setting the scope of discovery, the Magistrate Judge’s August 8th order addressed the parties’ dispute as to the location of the Ethicon corporate depositions. Ethicon sought to have the depositions conducted in Cincinnati, Ethicon’s principal place of business, and the city of residence of all the deponents. Webb’s counsel requested that the depositions take place in St. Paul, Minnesota, where they and some of Ethicon’s attorneys were located. The Magistrate Judge granted Ethicon’s request to hold the depositions in Cincinnati, concluding that it would be more efficient for Webb’s attorneys to travel to Ohio than for each of the deponents to be flown to Minnesota. After the August 8th order, Ethicon informed Webb that their witnesses would not be available on consecutive dates, requiring Webb’s counsel to make multiple trips to Cincinnati to complete the depositions. Webb then objected to the deposition location established in the August 8th order.
In an August 18th order, The Magistrate Judge denied Ethicon’s request that she reconsider her August 8th discovery order with respect to Webb’s additional document requests. The matter went before the District Court based upon both parties’ objections to the Magistrate’s August 8th order and Ethicon’s objection to the August 18th order.
During its analysis, the District Court observed that during her reasoning, the Magistrate Judge considered the declaration submitted by the Project Director for Ethicon’s Research and Development Department, which argued that the likely benefit of discovery into linear staplers beyond the TX line was substantially limited based upon significant differences in design and functions served. The Magistrate Judge found that staplers with a very different design were of little or no value, and the cost to Ethicon of producing the information would be significant. As a result, the Magistrate Judge declined to order expansive discovery into Ethicon staplers beyond the TX product line.
The Court also noted that the “Magistrate Judge demonstrated further cognizance of the importance of balancing the relative values and interests of the parties by not severely restricting the scope of discovery in the manner requested by Ethicon.” To balance discovery, the Magistrate Judge ordered Ethicon to produce information on other surgical staplers in the TX line, which appeared to have more features in common and would be more likely to be affected if there were a flaw the TX60B stapler design.
In addition to its objection to the August 8th order, Ethicon offered the Court a declaration from its Risk Manager stating that the cost of producing all relevant documents for all TX line staplers would be disproportionately high because Ethicon had produced the line for eighteen years and stored records for the line in multiple databases. Ethicon estimated that it would cost $62,400 to comply with the Magistrate Judge’s order, while Webb only asserted that her damages were “well in excess of $50,000.” Ethicon contended that the burden was disproportionate to the recovery Webb sought in this case, and that the Magistrate Judge’s discovery scope was therefore contrary to the proportionality concept encompassed by Rule 26.
The Court noted that the Magistrate Judge appeared “to have placed significant weight on the concept of proportionality” in narrowing the discovery scope from Webb’s request of all Ethicon liner staplers to only the TX line. The Court found that Ethicon’s expense analysis “did not alter make contrary to law” the Magistrate Judge’s conclusion that the burden and expense did not outweigh the likely benefit of producing the requested documents. Citing two earlier decisions, the Court noted, “(t)he fact that a corporation has an unwieldy record keeping system which requires it to incur heavy expenditures of time and effort to produce requested documents is an insufficient reason to prevent disclosure of otherwise discoverable information.” Wagner v. Dryvit Sys., Inc., 208 F.R.D. 606, 611 (D. Neb. 2001); Handi-Craft Co. v. Action Trading, S.A., No. 02-cv-1731, 2003 WL 26098543, at *11 (E.D. Mo. Nov. 25, 2003).
The Court found that the Magistrate Judge took expense, burden, and likely benefit into account when considering the scope of the August 8th discovery order and that a proportionality objection by Ethicon was contemplated by the August 18th order when it stated that, “Defendant’s objections to information sought in document request numbers 40 through 43 falls within the scope of discovery are overruled.”
In a footnote, the Court rejected Ethicon’s argument that it would violate due process for the Magistrate Judge to preemptively strike a proportionality objection that Ethicon had not yet formally made, because it would deprive Ethicon of “the opportunity to be heard on burdensomeness and relevance.” The Court found that Ethicon had received due process as to their proportionality argument, having extensively argued the issue in their motion for a protective order and in their letter to the Magistrate Judge requesting clarification of the August 18th order.
Concluding its analysis, the Court overruled both parties’ objection to the scope of discovery and adopted the Magistrate Judge’s August 8th order outlining the appropriate scope of discovery in the case.
With regard to Webb’s objection to the Magistrate Judge’s order that the Ethicon corporate depositions take place in Cincinnati as opposed to St. Paul, the Court concluded that the Magistrate Judge’s location determination was not contrary to law. The Court noted that the general rule requires that a Rule 30(b)(6) deposition take place at the corporation’s principal place of business absent unusual circumstances. The Court noted that the factors raised by Webb did not weigh in favor of exercising the Court’s authority to move the location of the corporate depositions. Overruling Webb’s arguments, the Court noted that there was “no indication that the Magistrate Judge viewed the number of Webb’s counsel’s trips to Cincinnati as dispositive of the location in this case ” and overruled Webb’s objection as to the location of the 30(b)(6) depositions.
Webb v. Ethicon Endo-Surgery, 2015 WL 317215 (D. Minn. Jan. 26, 2015)