In Page v. Bragg Comtys., LLC, No. 5:20-CV-336-D (E.D.N.C. Dec. 15, 2022), North Carolina Magistrate Judge Robert B. Jones Jr. rejected the defendant’s objection to including their past president as a custodian because he was an “apex custodian” and allowed plaintiffs’ motion to compel his designation as an ESI custodian.

Case Discussion

This case alleged violations of the North Carolina Residential Rental Agreements Act related to quality and maintenance of privatized military housing at Fort Bragg, North Carolina. The plaintiffs’ Motion to Compel Defendants to Begin Document Custodian and Search Term Discovery sought relief on two issues: 1) Plaintiffs wanted Defendants to commence production of responsive information and ESI using the parties’ agreed upon list of document custodians and search terms; and 2) Plaintiffs wanted John Piceme, Defendants’ past president, to be an additional custodian included in the search term based discovery.

Regarding the first issue, Defendants responded that they had started rolling productions of documents, including ESI from the custodian searches, so Judge Jones stated that “the motion to compel as to the first issue is denied as moot”.

As to the second issue, Defendants contended that Picerne was an “apex custodian,” and Plaintiffs had not made a compelling showing that all of the lower-level designated custodians are not sufficient to capture the necessary information. In arguing for Picerne’s inclusion as a custodian, Plaintiffs pointed out that he is the founder of defendant Corvias and that he made public statements through interviews and congressional testimony regarding the housing issue at Fort Bragg and other installations, which Plaintiffs viewed as evidence that Picerne had independent involvement and communications going to relevant issues that may not be captured by search of other custodians. Plaintiffs also questioned whether the apex custodian doctrine has been adopted in the Fourth Circuit and argued that Defendants failed to demonstrate that adding Picerne as a custodian would be an undue burden.

Defendants responded that Picerne was not directly involved with Fort Bragg housing or intimately involved in setting company policy regarding the issues in this case and that deposition testimony of Corvias’ Senior Vice President of Operations confirmed that Piceme had no day-to-day involvement with Fort Bragg and identifying who did have responsibility for managing the Fort Bragg housing. Defendants also contended Plaintiffs only speculated that Picerne might have relevant information and that seeking ESI from Picerne was unduly burdensome, cost prohibitive, and harassing when balanced against the scope of Plaintiffs’ claims. Finally, Defendants argued that even assuming Picerne had some hypothetical involvement with Fort Bragg, his communications would necessarily be captured in the documents produced by other custodians.

Judge’s Ruling

Judge Jones began his analysis by stating: “As an initial matter, the court is not convinced that the apex custodian doctrine has been adopted in the Fourth Circuit or, in any event, that it is necessary to the resolution of this matter. As one court explained, argument that a party’s senior executives are protected from being designated as custodians unless the party seeking such designation shows they possess unique, personal knowledge or information about the events underlying the case appears to call for application of the so-called “apex doctrine,” which the Fourth Circuit has not adopted and which typically applies only to protect senior executives from attending costly and distracting depositions rather than from merely collecting and producing documents.”

Continuing, he said: “Utilizing the standard set forth in Fed. R. Civ. P. 26(b), Defendants have not sufficiently demonstrated that Picerne is unlikely to possess information relevant to Plaintiffs’ claims and have not demonstrated that including Picerne as a custodian would be unduly burdensome or otherwise improper.”

Judge Jones also stated: “Plaintiffs have not merely speculated, as Defendants suggest, that Picerne is likely to have relevant information; rather, Plaintiffs have cited evidence that Picerne made public statements, including in congressional testimony, specific to Fort Bragg and the types of issues raised in Plaintiffs’ claims…Thus, the court finds it is likely that adding Picerne to the ESI custodian list would render relevant information.”

Finally, regarding proportionality objections, Judge Jones stated: “While Defendants argue that the discovery would be unduly burdensome, cost prohibitive, and harassing, they have presented nothing to support these assertions… This court has previously rejected unsubstantiated claims that discovery would pose an undue burden and was not proportional to the needs of the case… Finally, while Defendants assert this litigation involves only four families, the court declined to strike Plaintiffs’ class allegations at the pleading stage…Accordingly, Plaintiffs’ motion to compel the designation of Picerne as an ESI custodian is allowed.”

So, what do you think? Have you ever heard of an “apex custodian” objection before? Please share any comments you might have or if you’d like to know more about a particular topic.

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