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ORDER. Synovus's motion to terminate deposition at ECF Doc. 52 is DENIED.… — Agent Fee Litigation (Dkt. 84)
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An order of a United States Magistrate Judge in Sport & Wheat, CPA, PA v. ServisFirst Bank, Inc., et al., Case No. 3:20cv5425-TKW-HTC, in the U.S. District Court for the Northern District of Florida, Pensacola Division, dated July 14, 2020 and docketed as Dkt. 84. It resolves three motions: Synovus Bank's motion to terminate a deposition at ECF Doc. 52 is denied, the plaintiff's motion to file text messages under seal at ECF Doc. 63 is granted as to screenshots submitted for in camera review, and Synovus's motion for leave to file a reply at ECF Doc. 74 is denied as moot. It also finds neither party entitled to fees under Federal Rule of Civil Procedure 37 and directs each to bear its own costs. The background describes a corporate deposition taken via Zoom on June 18, 2020 that ran about three hours before being terminated, and a hearing held July 9, 2020. The order runs 17 pages.
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UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF FLORIDA
PENSACOLA DIVISION
SPORT & WHEAT, CPA, PA,
Plaintiff,
v. Case No. 3:20cv5425-TKW-HTC
SERVISFIRST BANK, INC., et al.,
Defendants.
__________________________________/
ORDER
This matter is before the Court on several motions filed by the parties: (1)
Defendant Synovus Bank’s (“Synovus”) motion to terminate deposition (ECF Doc.
52); (2) Plaintiff Sport & Wheat, CPA’s (“S&W”) motion to file text messages
under seal (ECF Doc. 63); and Synovus’s motion to file a reply to Plaintiff’s
response to the motion to terminate to address Plaintiff’s request for fees (ECF Doc.
74).1 The Court heard argument from the parties on July 9, 2020. Upon
consideration of the parties’ written submissions, the evidence presented, and the
arguments of counsel, the Court finds the motion to terminate should be DENIED,
the motion to file text messages under seal should be GRANTED, and the motion
1
S&W’s response to the motion to terminate can be found at ECF Doc. 73 and Synovus’s response
to the motion to seal can be found at ECF Doc. 72.
Page 2 of 17
to file a reply should be DENIED. The undersigned further finds that neither party
is entitled to fees under Federal Rule of Civil Procedure 37.
I. BACKGROUND
S&W files this action against Defendants for agent fees to which S&W alleges
it is entitled under the Coronavirus Aid Relief and Economic Security Act (the
“CARES Act”), Pub. L. No. 116-136, for assisting a borrower in obtaining a loan
under the Paycheck Protection Program (“PPP”). Defendant Synovus disagrees with
S&W’s interpretation of the CARES Act and further disputes that it worked with
S&W to provide loans for borrowers. Synovus has filed a motion to dismiss this
action, which is pending.
Shortly after the case was filed, and before written discovery was even issued
to S&W, S&W sought to take a 30(b)(6) deposition of Synovus. Although
Synovus’s counsel found this to be an odd request given the early stage of the
litigation, Synovus, nonetheless, agreed to the deposition. Synovus’s counsel
contends that this agreement was made only because S&W’s counsel agreed that he
would provide the names of the borrower(s) at issue prior to the deposition.
According to Synovus, this information was important in preparing its witness and
a search of its email records showed no communications between S&W and Synovus
regarding any borrower. Of course, S&W’s counsel disagrees that any such
promises were made. Additionally, S&W argues that it had provided enough
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information in the complaint from which Synovus could have easily identified the
borrower(s) at issue.
Synovus’s counsel made requests for the names of the borrower(s) on June 2,
and possibly again on June 15. No names were provided. Nonetheless, Synovus
proceeded with the deposition on June 18, 2020, as scheduled. Because of COVID-
19 issues, the parties conducted the deposition via Zoom.2 The deposition proceeded
for approximately three (3) hours and was subsequently terminated by Synovus
shortly after the parties returned from a lunch break and over the objection of S&W.
Synovus’s counsel stated on the record that he was terminating the deposition
under Rule 30(d) because it was being conducted in bad faith. Specifically, counsel
stated that Synovus’s counsel is entitled to see documents before they are put to the
witness 3, to have the witness consider the documents in context, and to have had the
prior communications that S&W’s counsel had promised. ECF Doc. 73-2 at 137. In
response, S&W’s counsel argued that under Rule 30(c)(2), if there is an objection to
the evidence, the parties’ conduct, the officers’ qualifications, or the manner of
taking the deposition, the objection should be noted on the record but the
2
Although it appears that Synovus also takes issue with the use of Zoom to take the deposition,
the undersigned does not find anything inherently improper about using video platforms such as
Zoom to take depositions if all parties agree. The use of Zoom, particularly in light of COVID-
19, helps move cases along and also reduces litigation costs.
3
At the July 9 hearing, Synovus’s counsel acknowledged that S&W’s failure to show documents
to counsel prior to the documents being shown to the witness for questioning is not necessarily
bad faith but is a matter of professional courtesy.
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examination still proceeds. Id. S&W’s counsel also objected to the termination
because it was “cutting off” his ability to ask the witness questions not related to the
exhibits and on other topics. ECF Doc. 73-2 at 138. Nonetheless, the witness and
his counsel left the deposition.
II. DISCUSSION
Two (2) business days after terminating the deposition, Defendant filed a
motion to terminate under Rule 30(d)(3). The bases set forth in the motion are the
same as those stated on the record, namely, that (1) S&W failed to identify the
borrower(s) for whom S&W claimed to have acted as an “agent”; (2) S&W’s
counsel failed to provide any communications it had with Synovus prior to the
deposition; and (3) S&W’s counsel sought to interrogate the witness with redacted
documents and refused to provide the witness and Synovus’s counsel the complete,
unredacted documents.
As an initial matter, the undersigned finds that bases one and two are
insufficient reasons to terminate a deposition. As stated above, S&W denies that it
made any agreement with Synovus to identify the borrower(s) at issue or to produce
documents prior to the deposition. Regardless, Synovus was well aware as the
deposition approached that this information was not forthcoming. Thus, Synovus
could have filed a motion for protective order rather than proceed with the
deposition. Synovus, having decided to proceed with the deposition despite not
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being provided the information it thought should have been forthcoming, and which
it thought was necessary to adequately prepare its witness, cannot complain about
that decision after the fact.
Thus, the undersigned will focus on basis number three – the redaction of
text messages used to question the witness during the deposition and the refusal of
S&W’s counsel to provide unredacted documents to either Synovus’s counsel or
the witness during questioning.
A. Motion To Terminate
Under FRCP 30(d)(3)(A), “[a]t any time during a deposition, the deponent or
a party may move to terminate or limit it on the ground that it is being conducted in
bad faith or in a manner that unreasonably annoys, embarrasses, or oppresses the
deponent or party . . . If the objecting deponent or party so demands, the deposition
must be suspended for the time necessary to obtain an order.” Fed. R. Civ. P.
30(d)(3)(A); Rutherford v. PaloVerde Health Care Dist., 2014 WL 12637191, at *2
(C.D. Cal. Oct. 28, 2014) (noting that “parties may halt the depositions and call the
magistrate judge for further guidance”). The Advisory Committee Notes to Rule 30
state that both pertinent sections to this case, (b) and (d), were introduced “as a
safeguard for the protection of parties and deponents on account of the unlimited
right of discovery given by Rule 26.” Fed. R. Civ. P. 30.
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During the deposition, S&W’s counsel questioned Synovus’s witness about
screen prints of text messages that included redactions. The text messages were
obtained from the cellphone of S&W’s principle, Jill Sport, and were text messages
between Ms. Sport and Synovus employee, Anna Weaver. The text messages had
not been produced to Synovus in either redacted form or unredacted form prior to
the deposition. Additionally, during the deposition, despite requests from
Synovus’s counsel for S&W’s counsel to provide an unredacted copy of the
messages to the witness and to Synovus’s counsel, S&W’s counsel refused to do
so. Although Synovus’s counsel allowed questioning on some of these text
messages, Synovus’s counsel terminated the deposition when it appeared that
S&W’s counsel was about to go into a second set of text messages involving Sport
and another Synovus employee, Larry Strain.
S&W explains in its opposition to the motion to terminate that the redactions
were merely to “focus” the witness on specific texts that S&W’s counsel was
interested in asking about; to remove, in some cases, irrelevant chit chat between
Ms. Sport and Ms. Weaver; to remove client information under Fla. Stat. 95.5055
protecting communications between an accountant and client; and to remove
private medical information relating to third parties. During the hearing, S&W’s
counsel added a new twist to their argument, explaining that each text, and not the
screen print of the text conversations, was a document on its own and, thus, the
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redactions were not really redactions, but instead were just documents that were
removed by S&W’s counsel from a series or set of documents. In other words,
according to S&W’s counsel, the redacted texts were the equivalent of having 10
photographs of an incident but only showing the witness 5 of those photographs
during a deposition.
At the Court’s instruction, after S&W filed a motion to seal the entire set of
text messages in S&W’s counsel’s possession, S&W submitted a complete
unredacted set of the Weaver and Strain text messages to the undersigned for in
camera review.4 Upon reviewing the portions of the text messages that were
redacted, the redactions are not as innocuous as S&W represents. The redactions
include information that could be relevant to Synovus and to the witness’s
understanding of the context of the communications, including showing that the
communications between Weaver and Sport could be interpreted as
communications between two friends about a mutual matter of interest; that Weaver
was, in several instances, the one helping Sport; and that Sport specifically asked
Weaver not to follow up on a question about fees.
4
S&W’s motion to seal the unredacted text messages was initially opposed by Synovus, primarily
because it still had not been provided or seen a copy of the unredacted messages. At the Court’s
request, after the July 9 hearing, the parties discussed the motion to seal and were able to reach an
agreement, which will be reflected in this order. In agreeing to have the text messages filed under
seal, Synovus expressly reserves its right to argue that any accountant-client privilege has
previously been waived.
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Also, several of the redactions, which were supposedly to protect a client,
identified no client by name at all or included redactions of more than just the client
name. Moreover, the entirety of the Weaver text messages consisted of 18 pages
of screen prints and, thus, there was no need to redact any information to “focus”
the witness. This was not a situation where the witness was being asked about one
paragraph in a 30-page contact.
While S&W argues that Synovus was aware that bank employees used their
personal cell phones to communicate with borrowers and should have done more
to obtain these messages from its own employees, that argument rings hollow.
“Discovery is not a game of ‘blind man's bluff,’ Dollar v. Long Mfg. N.C., Inc., 561
F.2d 613, 616 (5th Cir. 1977) (citation omitted), or ‘hide the ball,’ Hosea v.
Langley, 2006 WL 314454, *5 (S.D. Ala.) (unpublished).” Parrish v. Freightliner,
LLC, 471 F. Supp. 2d 1262, 1270 (M.D. Fla. 2006). At the end of the day,
Synovus’s request to see unredacted messages, at least during the questioning, was
not unreasonable. Indeed, counsel had no good answer at the hearing as to why
unredacted versions were not provided to Synovus’s counsel or the witness at the
deposition once Synovus objected to the use of redacted documents.
The undersigned also disagrees with S&W’s attempt to characterize each
message within the conversation contained on a screen print as a separate
document. Rather than analogizing text messages to a series of back and forth
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letters, an exchange of text messages is more akin to a transcript of a telephone
conversation. Just as redacting portions of a telephone conversation would make
the transcript incomplete and would be improper, there was no good reason to
redact portions of the text messages shown to the witness. See Fed. R. Evid. 106
(“[i]f a party introduces all of part of a writing or recorded statement, an adverse
party may require the introduction, at that time, of any part – or any other writing
or recorded statement – that in fairness ought to be considered at the same time”);
U.S. v. Jamar, 561 F.2d 1103, 1108 (4th Cir. 1977) (the purpose of 106 is to permit
the contemporaneous introduction of recorded statements that place in context other
writings admitted into evidence which, viewed alone, may be misleading); Fed. R.
Civ. P. 30(c) (“[t]he examination and cross-examination of a deponent proceed as
they would at trial under the Federal Rules of Evidence, except Rules 103 and
615”).
Having determined that S&W’s counsel should not have used redacted
screen prints of text messages to question Synovus’s witness, the Court must now
determine whether such conduct rises to the level of “bad faith” and “extraordinary
circumstances” that warrant the granting of a motion to terminate and the entry of
a protective order under Rule 26. As stated above, “Rule 30(d)[(3)] is a narrow
procedure designed for extraordinary situations where an examination is being
conducted in bad faith or in an unreasonable, annoying or oppressive manner.”
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Buckley Towers Condo. Inc., 2008 WL 2645680, at *9 (quoting SEC v. Oakland
Corp., 141 F.Supp.2d 435 (S.D.N.Y. 2001)). “Rule 30(d)[(3)] is not a backdoor
mechanism for counsel to instruct witnesses not to answer certain questions. Nor
is it designed in any way to preclude a witness from answering questions based on
relevance.” Id. at *8. Similarly, a protective order under Rule 26 is used to prevent
a party from “annoyance, embarrassment, oppression, or undue burden or expense.”
Fed. R. Civ. P. 26(c).
Case law involving Rule 30(d)(3) is limited. Indeed, as Synovus’s counsel
recognized, in his over 40 years of practice, he has not ever terminated a deposition
under Rule 30(d)(3). Typically, situations where Rule 30(d)(3) has been utilized
involve improper questioning of a witness on matters aimed solely for purposes of
harassing or on privileged matters. See, e.g., CSX Transp. Inc. v. Gilkison, 2009
WL 2985594, at *2 (N.D. W. Va. Sept. 15, 2009) (finding proper use of Rule
30(d)(3) where counsel instructed witness not to answer questions believed to be
asked in bad faith and to unreasonably annoy, embarrass, and oppress, stated on the
record that he intended to seek an order to terminate, and did seek that order);
Rottlund Co., Inc. v. Pinnacle Corp., 222 F.R.D. 362, 381 (D. Minn. 2004) (stating
that where an opposing attorney wanted to be the first to tell the deponent he was
going to lose his job was “the epitome of bad faith” harassment. “The line of
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questioning had nothing to do with the lawsuit and was intended for no reason other
than to inflict emotional angst”).5
The undersigned finds that the conduct at issue here, namely, the refusal to
provide Synovus’s counsel or the witness with unredacted documents, while highly
objectionable, is not the type of extraordinary circumstance warranting the entry of
an order to terminate or protective order. Instead, the undersigned agrees with
S&W that the correct procedure to be employed is under 30(c)(2). Namely,
Synovus’s objection should have been made on the record and, at the very least, the
parties should have proceeded with the deposition on matters unrelated to the
exhibits and on the other topics on which the witness had been designated to testify.
“While the Court is mindful of Defendant’s predicament at [the 30(b)(6)]
deposition, none of the circumstances that permit an attorney to instruct his or her
client not to answer were present here. Defendant’s counsel should have therefore
noted his objection on the record, and allowed [the witness] to answer these
questions.” Siegmund v. Xuelian Bian, 2018 WL 4293148, at *1 (S.D. Fla. Sept. 6,
2018). Furthermore, allowing a party to unilaterally terminate a deposition mid-
5
See also, O’Boyle v. Sweetapple, 2016 WL 9559956, at *3 (S.D. Fla. Jul. 6, 2016) (decision to
terminate deposition was proper where plaintiff refused to state how much longer deposition would
last); but compare, Graves v. Standard Ins. Co., 2016 WL 3512032, at *6 (W.D. Ky. Jun. 16, 2016)
(failure to notice deposition as one being conducted by remote means was not automatic basis for
entry of protective order).
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stream based on an objection regarding documents could lead to an abuse of Rule
30(d)(3).
The undersigned, therefore, declines to enter a protective order or enter an
order terminating Synovus’s 30(b)(6) deposition. The deposition should be
continued, once the stay is lifted, should S&W want to continue the deposition.
However, because the issue is now before the Court, the undersigned cautions S&W
against deposing the 30(b)(6) witness (or any witness in this matter) about text
messages or documents that have been improperly redacted or that are incomplete.
See id. (requiring party to provide documents to counsel translated from Mandarin
to English prior to deposition because “Defendant’s counsel, who does not speak
Mandarin, cannot be expected to meaningfully participate in the deposition without
a certified translation of the documents on which Plaintiff will rely”). To the extent
that any expected text messages or other documents contain privileged or
confidential information, which require redaction, the parties should seek the entry
of a protective order in advance of the deposition. Similarly, Synovus should
consider whether it is ready and fully prepared to proceed with a deposition before
agreeing to proceed. It is not always better to ask for forgiveness later.
B. Request For Fees
S&W has moved for fees under Rule 37, arguing that the motion to terminate
was unnecessary as S&W advised Synovus that it had not yet reached a decision as
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to whether it would seek to continue the deposition. S&W also contends that
Synovus failed to comply with the meet and confer requirements in Local Rule
7.1(b) prior to filing the motion. Synovus filed a motion seeking leave to file a
reply to the request for fees. However, because the undersigned is denying fees, no
such reply is necessary.
The undersigned agrees with the argument made at the hearing by Synovus’s
counsel that Synovus met the meet and confer requirements by attempting,
unsuccessfully, to work the matter out at the deposition. Indeed, at least one court
has held that a motion to terminate must be filed immediately after the deposition
is terminated. See In re Omeprazole Patent Litig., 227 F.R.D. 227, 230 (S.D.N.Y.
2005) (“if the plaintiff’s attorney believed that the examination was being
conducted in bad faith … or that the deponents were being needlessly annoyed,
embarrassed, or oppressed, he should have halted the examination and applied
immediately to the ex parte judge for a ruling on the questions, or for a protecting
order, pursuant to Rule 30(d)”). Thus, had the motion not been filed after the
deposition, Synovus could have risked an argument that any later motion was
untimely. See Thomas v. Rockin D Marine Serv., LLC, 2013 WL 2459217, at *3
(E.D. La. Jun. 6, 2013) (finding passage of over a month “clearly in excess of any
time ‘necessary’” for a written motion to be presented under Rule 30(d)(3)).
Moreover, S&W’s subsequent email attempting to resolve the matter after the
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deposition, while punting the issue down the road, did not necessarily moot the
issue as it included a reference to a potential motion to compel. ECF Doc. 52-6 at
3; see Buckley, 2008 WL 2645680, at *9 (noting improper reliance on predecessor
rule, Rule 30(d)(4), where “[n]o motion was filed that day, the day after, or even
after several days passed. The issue was raised by Plaintiff's motion to compel.
Indeed no motion for protective order was ever filed”).
Additionally, the undersigned notes that a Rule 30(d)(3) motion to terminate
is subject to fees to the prevailing party under Rule 37(a)(5). When the discovery
motion is denied, such as in this case, the rule provides that the Court, “must, after
giving an opportunity to be heard, require the movant, the attorney filing the
motion, or both to pay the party or deponent who opposed the motion its reasonable
expenses incurred in opposing the motion, including attorney's fees. But the court
must not order this payment if the motion was substantially justified or other
circumstances make an award of expenses unjust.” Fed. R. Civ. P. 37(a)(5)(B).
Similarly, Rule 30(d)(2) also allows the court to “impose an appropriate sanction--
including the reasonable expenses and attorney's fees incurred by any party--on a
person who impedes, delays, or frustrates the fair examination of the deponent.”
Fed. R. Civ. P. 30(d)(2).
But, under Rule 37(a)(5)(B) and 30(d)(2), whether fees should be granted is
dependent on whether the position of the non-prevailing party was substantially
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justified. “Substantially justified means that reasonable people could differ as to
the appropriateness of the contested action.” Maddow v. Procter & Gamble Co.,
107 F.3d 846, 853 (11th Cir. 1997) (citing Pierce v. Underwood, 487 U.S. 552, 565
(1988)). The undersigned will save the parties the burden of filing any additional
motions for fees on this issue as the undersigned finds that there was fault here by
both parties and, thus, while the undersigned is denying the motion to terminate,
the undersigned also finds that it was substantially justified.
As explained by Synovus’s counsel, he felt at the time of the deposition that
he had no other choice but to terminate it given his frustration over the redacted
text messages, which was only further enhanced by what counsel deemed as a lack
of cooperation prior to the deposition taking place. Counsel acknowledges that in
hindsight, maybe he should never have agreed to proceed with the deposition at all.
Similarly, it appears to the undersigned that S&W’s counsel fully believed that he
had every right to only show the witness the text messages he felt were relevant and
pertinent to his questioning and did not see anything improper in the redactions that
were made. Indeed, while the undersigned, upon review, disagrees that the
redactions were proper or, for that matter, necessary, counsel clearly believed in his
position or he would not have insisted on providing all the text messages to the
Court for review. Like Synovus’s counsel, S&W’s counsel also acknowledged that,
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in hindsight, the unredacted documents should have been provided. But, in the
words of the late Pat Dye, hindsight is only 50/50.
III. CONCLUSION
A cursory review of the correspondence between counsel in this case shows
that the parties have clearly started off on the wrong foot in this case and, for
whatever reason, there is a lack of trust and collegiality. As Judge Wetherell noted
in his order staying discovery, the parties “disagree on nearly everything” other
than that the case is unlikely to settle promptly. ECF Doc. 64 at 1. As it applies
specifically to discovery, “[w]hile the court is fully cognizant that some lawyers
believe that they can win a case in discovery by ‘discovery gamesmanship,’ … the
parties are warned that the time for ‘discovery gamesmanship’ ends now.” Wright
v. Kimberly-Clark Glob. Sales, LLC, 2010 WL 11493791, at *1 (N.D. Ga. May 24,
2010). The parties and their counsel should consider, as suggested by S&W’s
counsel after the deposition had ended, pushing the “reset” button, not only as to
the deposition, but as to their interactions in this case.
Accordingly, it is ORDERED that:
1. Synovus’s motion to terminate deposition at ECF Doc. 52 is DENIED.
2. S&W’s motion to seal at ECF Doc. 63 is GRANTED, to the extent that
S&W is directed to file under seal the copies of screenshots from Jill Sport’s phone
that Plaintiff’s counsel submitted to the Court for in camera review on Wednesday,
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July 8, 2020 (“the Screenshots”). In the event that the Court lifts the stay of
discovery in the above-captioned case, any party may move to lift this Seal for good
cause shown. The Seal shall not limit the ability of Plaintiff or Synovus from
disclosing the Screenshots to their respective officers, employees, or counsel. The
Seal applies only to the Screenshots; to the extent copies of the text messages shown
in the Screenshots are available from sources other than the Screenshots, the Seal
does not apply.
3. Synovus’s motion for leave to file a reply brief in support of its motion
to terminate at ECF Doc. 74 is DENIED as moot.
4. Each party is to bear its own fees and costs associated with the filings
of the subject motions and responses.
DONE AND ORDERED this 14th day of July, 2020.
s/ Hope Thai Cannon
HOPE THAI CANNON
UNITED STATES MAGISTRATE JUDGE
Case No. 3:20cv5425-TKW-HTC
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