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Sunterra Corp. v. Perini Building Co.

February 20, 2009


The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge


Pursuant to Federal Rule of Civil Procedure 30(b)(6), Perini Building Company and Perini Corporation (collectively "Defendants") move to compel each Plaintiffs' designation of persons most knowledgeable ("PMKs"). Plaintiffs are hereby directed, consistent with the terms of this Order evaluating Defendants' Rule 30(b)(6) Notices of Deposition filed December 4, 2008, to designate the requested PMKs.


Lake Tahoe Resort Partners, LLC ("LTRP") is a wholly owned subsidiary of a Diamond Resorts Corporation holding company, which is, in turn, a wholly owned subsidiary of Diamond Resorts (formerly known as Sunterra Corporation). In 1996, LTRP contracted with Perini Building Company for the development of the Lake Tahoe Vacation Resort ("Resort"). At the same time, LTRP and Perini Corporation entered a Guaranty of Performance and Indemnity Agreement under which Perini Corporation guaranteed the performance of Perini Building Company. Perini Building Company then began construction of the Resort.

Sunterra, along with various affiliated entities, subsequently initiated bankruptcy proceedings. During those proceedings, Sunterra discovered a number of defects alleged to have occurred in the construction of the Resort. Thus, in 2002, Sunterra instituted the current action against Perini Building Company to recover for those deficiencies. On June 20, 2008, Diamond Resorts filed its First Amended Complaint ("FAC") adding a number of Plaintiffs, a second Defendant, Perini Corporation, and new causes of action. Since then, Plaintiffs have filed a Second ("SAC") and then a Third Amended Complaint ("TAC"). Currently before the Court is Defendants' Motion to Compel Plaintiffs' Designation of PMKs pursuant to Rule 30(b)(6).


Federal Rule of Civil Procedure 30(b)(6) provides that "a party may name as the deponent a public or private corporation...or other entity and must describe with reasonable particularity the matters for examination. The named organization must then designate one or more officers, directors, or managing agents, or designate other persons who consent to testify on its behalf; and it may set out the matters on which each person designated will testify...The persons designated must testify about information known or reasonably available to the organization."

Additionally, in its Discovery Order No. 5, the Court directed that "[o]n or before July 11, 2008 all parties shall exchange a list identifying the person or persons most knowledgeable (PMK) concerning the Sunterra project. Each party shall state whether the individual or individuals identified on the list as a PMK is a current employee of the party and/or whether he or she will be produced for deposition by the party. If the listed individual is no longer an employee or cannot be produced by the party, counsel shall supply his or her last known address and telephone number."

Plaintiffs make numerous repetitive objections to Defendants' PMK requests. Rather than address each objection to every specific category, the Court will address each general objection in turn.

A. Plaintiffs' Objections to Defendants' Request that Each Plaintiff Designate PMKs

Plaintiffs object to Defendants' request that each named Plaintiff designate PMKs. However, the plain language of Rule 30(b)(6) indicates that each party is to designate a witness as requested. Additionally, in Discovery Order No. 5, the Court specifically stated "all parties" shall exchange the requisite information and "each party" shall make various statements. Each Plaintiff is an entity separate and distinct from the remaining Plaintiffs and suing on its own behalf, and it is only logical that each Plaintiff be required to designate PMKs.

Nevertheless, Plaintiffs argue that efficiency and judicial economy demand a contrary finding. According to Plaintiffs, requiring each entity to designate PMKs will result in taking the deposition of approximately 288 individuals. Plaintiffs' argument is not entirely accurate. There appears to be nothing preventing each Plaintiff from naming the same PMKs to testify as to a particular category if, indeed, that person is the most knowledgeable for that Plaintiff. Moreover, one PMK may be able to testify as to multiple categories. Therefore, the actual number of depositions required will likely be much lower than the 288 hypothesized by Plaintiffs.

Accordingly, Plaintiffs' objection is overruled, and each Plaintiff is ordered to individually respond to Defendants' 30(b)(6) requests by designating the requisite PMKs.

B. Plaintiffs' Objections to Defendants' Requests for Designation of Persons No Longer Employed by Plaintiffs

Plaintiffs responded to a number of Defendants' requests by stating that they would endeavor to provide the name and address of PMKs no longer in their employ. However, Defendants seek PMK designations not because they desire to uncover that which is in the personal knowledge of the various PMKs, but because it is only through such PMKs that Plaintiffs can testify. Accordingly, Defendants maintain that Rule 30(b)(6) requires Plaintiffs not only to designate PMKs, but also to prepare those individuals to testify on behalf of each entity. Plaintiffs disagree contending that, pursuant to ...

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