Free Motion for Protective Order - District Court of Colorado - Colorado

Case 1:04-cv-01225-MSK-BNB

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Honorable Marcia S. Krieger Case No. 04-cv-1225-MSK-BNB (Consolidated with 04-cv-1226-MSK-BNB)

MALIK M. HASAN, M.D., an individual; and SEEME G. HASAN, an individual, Plaintiffs, v. GOLDMAN SACHS 1998 EXCHANGE PLACE FUND, L.P., a Delaware limited partnership; GOLDMAN SACHS 1999 EXCHANGE PLACE FUND, L.P., a Delaware limited partnership; GOLDMAN SACHS MANAGEMENT PARTNERS, L.P., a Delaware limited partnership; GOLDMAN SACHS MANAGEMENT, INC., a Delaware corporation; THE GOLDMAN SACHS GROUP, INC., a Delaware corporation; GOLDMAN, SACHS & CO., a New York limited partnership; JOHN DOES 1-100, individual persons whose true identities are unknown; and LENDER PARTIES 1-100, business entities whose true identities are unknown, Defendants. T EN ME D F N A T ' T O F RP O E T V O D R H A D E E D N S MO I N O R T C I E R E

Pursuant to FED. R. CIV. P. 26(c) and D.C.COLO.LCivR 30.2, the Named Defendants respectfully move this Court for a protective order quashing p i isi poenotice for the ln f 'm rpr a tf deposition of Gordon M. Binder on October 20, 2005, in Los Angeles, California.1 Plaintiffs' eoio nte iea s n v le t C ut d cvr adr l dpsi o c d r r ad i a sh ors i oe n ta tn i s g d ot e ' s y i schedule in this matter; the Federal Rules of Civil Procedure and the C ut l arl ; and the orso lu s ' c e obligation to seek and secure leave of court to take discovery after cutoff. Plaintiffs served the
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Pursuant to D.C.COLO.LCivR 30.2, the filing of this motion stays the deposition until further order of the court.

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notice of deposition on October 13, 2005, by regular mail (it was received on Saturday, October 15); plaintiffs inexplicably did not fax or email the notice. The deposition notice, therefore, was given one month after the close of discovery and the exchange of trial witness and exhibit lists and deposition designations. Plaintiffs have not moved or requested that the September 12, 2005 discovery deadline be extended, and do not attempt to show good cause for such extension. Plaintiffs provided less than eleven days notice and did not make a good faith effort to schedule it for a time reasonably convenient and economically efficient to counsel for the Named Defendants, in violation of D.C.COLO.LCivR 30.1(A). The deposition violates the presumptive limit of ten depositions per side set forth in FED. R. CIV. P. 30(a)(2). Plaintiffs seek to obtain information through the deposition that is neither relevant to the claims or defenses of the parties, nor reasonably calculated to lead to the discovery of admissible evidence on the issue of arbitration, in violation of FED. R. CIV. P.6 n t C ut O dr a d rch 24, 2005 (Doc. 2 ad h ors redt Ma e ' e #133). For these and the other reasons set forth herein, the deposition notice should be quashed and the deposition of Mr. Binder precluded. Pursuant to D.C.COLO.LCivR 7.1(A), before filing this motion, counsel for defendants conferred in good faith with counsel for plaintiffs regarding the relief sought in this Motion. (See Exs. A, B, C, E.) These efforts failed. I. T ED P ST O V O A E T I C U TSD S O E YA D H E O I I N I L T S H S O R ' IC V R N TRIAL SCHEDULE

Plaintiffs served the notice of deposition of Mr. Binder without leave of Court after the c s o d cvr iv li o t s ors i oe ad r l ed ns l e f i oeyn i ao fh C ut d cvr n tadal e. o s o tn i ' s y i i On March 24, 2005, the Court set a two-day bench trial on the issue of arbitrability for July 19-20, 2005 and stayed discovery of all issues "xetsoh efr aito t ecpa t t noc b i fh e e ly e

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a iao c ue" ts e ( o.13 " r 2 O dr . connection with this trial r t t n l ss ai u. D c#3 ( c 4 re ) bri a s Ma h ")In scheduling, the Court set July 8, 2005 as the deadline for the completion of depositions for trial and July 12, 2005 as the date for the parties to exchange exhibit and witness lists and deposition designations. (Doc. #147 at 9:24-10:2; #149.) O Jn 2,05o p i ism t nt C uteet tadttSp m e2-22, n ue 220,n ln f ' o o, e orr th r la o et br 1 a tf i h s ei e e 2005, and also reset the deadlines for deoios n tasb i i so t sm nm eo psi ad r lum s o t" e a e u br f tn i sn h dy peei t nwy ceu d er g ( o.11 T iO dreu e d cvr t as r d gh e l shdl ha n. D c#5. h re r i d i oe o c n e e i " ) s qr s y conclude by September 12 and the parties to exchange witness and exhibit lists and deposition designations by September 14, 2005. On motions filed by the parties regarding the deposition of Kathleen Eskola properly noticed by the Named Defendants for September 12, 2005, this Court reaffirmed that the discovery cutoff was September 12, 2005. (Doc. #188.) On September 14, 2005, the parties exchanged exhibit and witness lists and deposition designations for trial, pr ato h C ut Jn 2,05 re us ntt orsue 220 O dr u e ' . On September 16, 2005, after the close of discovery and the pretrial exchanges, the Court, sua sponte, rescheduled the two-day bench trial on arbitrability to November 9-10, 2005, deo cnltnh C ut cl dr ( o.14 T e ord ntx n o r any u ta ofco t ors a na D c#9. h C uti o et d re i e ' e . ) d e -set discovery deadlines. No motion was timely made by the plaintiffs to extend or re-set the discovery deadlines. Thus, discovery is now closed absent leave being granted, as defendants stated to plaintiffs by email. ln f ' o c o dpsi v le t pe i odroc d g Pa tf nte f eoio i a sh r r lrecnl i i is i t n o t e ta un discovery on September 12. In response to defendan ' be aosp t osr t n,laintiffs' s vi counsel asserted that discovery has not closed. (See Ex. A.) This assertion is contradicted by the relevant orders and settings (described above) and plaintiffs own previous argument to this Court that discovery

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closed on September 10, 2005. (Doc #182: Pls.' t Prot. Order at ¶ 2.) The deposition Mo for . notice therefore must be quashed. See Watson v. City of Kan. City, No. 84-2335-S, 1989 WL 21165, at *4 (D. Kan. Feb. 2, 1989) (Ex. F). II. PLAINTIFFS VIOLATED LOCAL RULE 30.1(A) IN SETTING THE DEPOSITION

D.C.COLO.LCivR 30.1(A) provides that, absent stipulation or leave, a notice of dpsi sa ntes e " st n days"n dac adht eoio hl ob i ud l sh 11 tn l s e a iavne n t before sending a notice to a take a deposition, counsel " shall make a good faith effort to schedule it by agreement at a time reasonably convenient and economically efficient to the proposed deponent [and] all counsel of record."The subject notice does not comply. Plaintiffs failed to provide the Named Defendants eleven days notice of their deposition. On October 6, 2005, plaintiffs'oner us d h udrge cusl aaaitfr cusle et t ne i d one s vib i o q e e sn ' l ly depositions of two or more unidentified and undisclosed investors during October. (Ex. B.) In response, the undersigned counsel remine p i iscuslhti oe w s l e ad dd ln f 'onet d cvr a c sd n, a tf a s y o without waiver, advised him that he would be traveling outside of the country from October 12 through October 23. (Ex. B.) On October 11, 2005, Pa tf cusl an email to the undersigned counsel ln f 'onesent i is proposing to set a deposition of Mr. Binder for October 20, 2005. (Ex. C.) This email was the first disclosure of Mr. Binder as a potential witness in this proceeding. The email gave no information about Mr. Binder, no reason for the deposition, and no explanation why plaintiffs were seeking to take the deposition after the discovery cutoff. In response to this email, the undersigned counsel stated that the Named Defendants opposed the deposition and, without waiver, again av e p i isc di d ln f 'ounsel that he was unavailable for a deposition on October 20 s a tf

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because he was traveling outside the country. (Ex. C.) Pa tf counsel responded " . ln f ' i is Mr Binder is a busy man, but I will check on his availability" advised that he would serve a and notice setting the deposition for October 20. (Ex. A.) On October 14, the undersigned counsel r i e p i iscusl e n d ln f 'oneonce again that he was outside of the country and unavailable on m d a tf October 20. (Ex. A.) Without any further communication, plaintiffs' counsel served by regular mail a notice dated October 13, 2005, setting the deposition for October 20, 2005. (Ex. D.) Eleven days notice of the deposition was not provided. On this basis alone, the Notice should be quashed. Plaintiffs did not attempt in good faith to set the deposition for a date reasonably convenient and economically efficient to counsel for the Named Defendants. The Named Defendants desire for Mr. Featherstone to attend the deposition, given his extensive involvement in the discovery to date. See Seabrook Med. Sys. v. Baxter Healthcare Corp., 164 F.R.D. 232, 233 (S.D. Ohio 1995). Mr. Featherstone has repeatedly advised counsel for plaintiffs that any such discovery would be his responsibility and that he is currently out of the country and unavailable on October 20, 2005. (Exs. A, B and C.) Plaintiffs made no effort to schedule the deposition at a time convenient to Mr. Featherstone before serving the notice of deposition. T u t dpsi sol b vct deo ln f 'l r hsh eoio hu e aa d u tp i isc aviolations of D.C.COLO.LCivR e tn d e a tf e 30.1(A). After serving the deposition notice on October 17, plaintiffs offered to reschedule the deposition to October 26, 27 or 31. (Ex. E.) This did not cure the defects.2 Plaintiffs still failed

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For example, were this Court, after a showing of good cause to allow the deposition, it should take place on a mutually convenient date and on a date that allows the Named Defendants to obtain document discovery from Mr. Binder. Without discovery of the documents, i.e, the 5

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to comply with Local Rule 30.1(A) before serving the notice, the deposition is still untimely udrh C ut d cvr adr lceu , still violates the presumptive deposition limits, net ors i oe n tashdl it e ' s y i e and it still does not seek information relevant or reasonably calculated to lead to the discovery of admissible evidence on the issue of arbitration. F r e t "f rd nt i da t ut r h of " i o wt r h h,e e d h w e outstanding notice of deposition. III. T ED S O E YV O A E FRCP 2() N T EC U TS H IC V R I L T S ....6b A D H O R ' LIMITS ON THE SCOPE OF DISCOVERY

Plaintiffs seek to obtain information that is neither relevant to the claims or defenses of the parties nor reasonably calculated to lead to the discovery of admissible evidence on the issue of arbitration in violation of FED. R. CIV. P. 26 ad h C ut O dr a d r 2,005 n t ors redt Ma h 42 e ' e c (Doc. # 133). Pa tfs tt fl wn r a i t r eac o MrBne set oy ln f teh o o i e r n h e vne f . i r t i n: i is a e l g g d g e l d ' sm He received investment materials from the Goldman Sachs Defendants, including a Private Placement Memorandum, that is not bound (and certainly not using Perfect Bind). His document(s) refute the assertion of the Goldman Sachs Defendants that all of these materials were bound using Perfect Bind prior to transmission to investors in the funds. (Ex. A.) The Named Defendants have not made the sweeping assertions claimed by plaintiffs. The only issue relating to a bound versus unbound documents raised in this matter has been p i isasro t thy ee e ubudsl t pgsrmt sbc p o bols ln f 's t nh t r i d non,e c d ae f h usr t n ok tat a tf ei a e c v ee o e ii e the time of execution of the Subscription Agreements for the Exchange Funds. Plaintiffs do not claim that Mr. Binder received an unbound subscription booklet. In fact, the undersigned " vs et a r lf mt G l a Scs e nat" bu w i MrBnewl i et n m t isr h o m n ah D f dn ,aot h h . i r i n m ea o e d e s c d l prot lt tydf dn 'rs ea i t n f . i ew u b vr l idint upr dye i ,e nat c s xm n i o MrBn r ol e e i t , o e sf e s o ao d d yme f impossible. 6

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cusler eththy aen hips s o MrBne s oner e nt t hv it r os s n . i r original signed subscription ps a e e ei d' booklets and represent to the Court that they are bound ­ the perfect binding process. in More importantly, e hl" se o a ubud usr t n ok t a nwbcm t w o i u" fn non sbc p o bol hs o eo e h e s ii e irrelevant. For even if the plaintiffs could somehow show that they received only selected pages from the Subscription Agreements, the pages that they undoubtedly received, according to i eti aa s o fr s dcm n ea i rad ln f ' w am s osa n n t n nl i foe i ou etxm n s n p i iso n d i i ,r d ao ys nc e a tf sn e sufficient to bind them to the arbitration provisions at issue. (D f' tF r e .Mo o Preclusion (Doc. # s . 200) pp. 6-10, 15.) Further, even if one investor (out of the 400-500 investors in each Fund), whose account was handled by a different Goldman Sachs office, had received certain unbound investment materials, that would not be relevant to the issue of whether plaintiffs received unbound subscription booklets. See F ..0 ( R l atv ec' en ei ne ai . E 41 " e vn ei ne m as v ec hv g R ` e d d n any tendency to make the existence of any fact that is of consequence to the determination of the action m r poalo l s rbb t nt ol b wt ut ei ne ) T u, e oe rbb re poal h iw u e i oth v ec.. hst e s e e d h e d " h proposed deposition would violate FED. R. CIV. P.6 n t C ut Ma h 420 O dr 2 adh ors r 2,05 re e ' c . IV. THE DISCOVERY VIOLATES THE PRESUMPTIVE LIMIT ON THE NUMBER OF DEPOSITIONS

Pursuant to FED. R. CIV. P. 30(a)(2), a party must obtain leave of court prior to taking more than ten depositions. Plaintiffs have deposed the following persons: (i) Robert Mueller; (ii) Jeffrey Collins; (iii) Jm s 'huhes; Nelwyn Powell; (v) Thomas Graziano; (vi) a e O S agnsy(iv) Ray DeLuca; (vii) Thomas Economos; (viii) Lorraine Tozzo; (ix) J. Donald Vacca; and (x) The

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Named Defendants pursuant to Rule 30(b)(6). Therefore, the notice of deposition should be quashed because it was issued in violation of Rule 30(a)(2).3 WHEREFORE, the Named Defendants respectfully move this Court for entry of a Protective Order quashing the notice of deposition of Gordon M. Binder served by mail on October 13, 2005. DATED: October 19, 2005 Respectfully submitted,

/s/ Bruce Featherstone Bruce A. Featherstone Matthew D. Collins FEATHERSTONE DESISTO LLP 600 17th Street, Suite 2400 Denver, Colorado 80202 Telephone: (303) 626-7100 Facsimile: (303) 626-7101 E-mail: [email protected] E-mail: [email protected] Max Gitter Nancy I. Ruskin CLEARY GOTTLIEB STEEN & HAMILTON LLP One Liberty Plaza New York, New York 10006 Telephone: (212) 225-2000 E-mail: [email protected] ATTORNEYS FOR THE NAMED DEFENDANTS

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The Scheduling Order governing discovery on the merits sets a limit of 15 depositions per side. (Doc. #83 p. 16.) Because the Court has not set a limit on the number of depositions for the arbitration trial, the parties are limited to ten depositions per side pursuant to Rule 30(a)(2). 8

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CERTIFICATE OF MAILING I hereby certify that on October 19, 2005, I electronically filed the foregoing THE N ME D F N A T ' A D E E D N S MOTION FOR PROTECTIVE ORDER with the Clerk of Court using the CM/ECF system, which will send notification of such filing to the following e-mail addresses: Glenn W. Merrick SENN VISCIANO KIRSCHENBAUM MERRICK P.C. [email protected]

/s/ Bruce Featherstone Bruce A. Featherstone FEATHERSTONE DESISTO LLP 600 17th Street, Suite 2400 Denver, Colorado 80202 Telephone: (303) 626-7100 Facsimile: (303) 626-7101 E-mail: [email protected] ATTORNEYS FOR THE NAMED DEFENDANTS

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