I. Introduction

*1 On January 4, 2021, Kenneth A. Storms (“Storms” or “Plaintiff”) brought this action against Paychex, Inc. and Paychex North America, Inc. (collectively “Paychex” or “Defendants”). Dkt. 1-2 (“Complaint”). The Complaint advances four causes of action that arise from the termination of Plaintiff's employment by Defendants: (1) discrimination on the basis of age in violation of Cal. Gov't Code §§ 12940(a), et seq.; (2) retaliation in violation of Cal. Gov't Code §§ 12940(h), et seq.; (3) failure to prevent discrimination and harassment; and (4) wrongful termination in violation of public policy.

On March 30, 2023, Judge McDermott issued two identical orders in response to the parties' report regarding the 30(b)(6) deposition of the Defendants. Dkt. 84; Dkt. 85 (the “Discovery Orders”). At that time, Judge McDermott concluded that Defendants substantially complied with his prior orders and that no further action was warranted. Id.

On April 13, 2023, Plaintiff moved for relief from the Discovery Orders. See Dkt. 86 (the “Motion”). Through the Motion, Plaintiff seeks a ruling reversing the Discovery Orders and the issuance of an order to show cause why sanctions should not be imposed on Defendants for their failure to comply with Judge McDermott's prior orders regarding depositions. Dkt. 86-3 at 2. On April 27, 2023, Defendants opposed the Motion. Dkt. 92 (the “Opposition”). On May 4, 2023, Plaintiff filed a reply in support of the Motion. Dkt. 93 (the “Reply”). The parties were directed to submit supplemental briefing. Dkt. 94. On May 16, 2023, Defendants filed a supplemental brief. Dkt. 95 (“Defendants' Supplemental Brief”). On May 18, 2023, Plaintiff filed a supplemental brief. Dkt. 96 (“Plaintiff's Supplemental Brief”).

A hearing was held on May 22, 2023, and the Motion was GRANTED IN PART and DENIED IN PART for the reasons stated on the record and in this Order. Defendants are directed to designate a 30(b)(6) representative(s) to testify with respect to Topics 28, 29, 30 and 35. For the limited purpose of obtaining this testimony, the cutoff for non-expert discovery is extended to June 23, 2023. The hearing on the parties' pending Motions for Summary Judgment is continued from June 12, 2023 to July 10, 2023. On or before June 26, 2023, Plaintiff shall file a supplemental brief not to exceed five pages stating the claimed effect of the 30(b)(6) deposition testimony, if any, on the pending Motions for Summary Judgment. On or before June 28, 2023, Defendants shall file a supplemental brief of the same length on the same subject. The parties shall work together collaboratively to complete these depositions efficiently.

II. Factual Background

A. Plaintiff's Allegations

Plaintiff was employed by Defendants as a Major Market Sales Representative from March 2017 until December 11, 2019, when Plaintiff was terminated by Defendants. Complaint ¶¶ 2-3. Plaintiff contends that he was a loyal and exemplary employee who was fired because of his age and because he complained about age-based discrimination. Id. ¶ 2.

*2 Plaintiff earned a yearly salary of $51,000, plus a monthly commission that ranged from 9% to 14% of sales that he generated in the preceding month. Complaint ¶ 18. Beginning in November 2019, Plaintiff was earning 14% of his monthly sales plus a 9% “kicker” for his year-to-date sales to the extent they exceeded 125% of his sales objectives. Id. ¶ 19. Plaintiff also received other monthly and quarterly bonuses in addition to a Strategic Partner Bonus. Id.

Shortly after he became employed by Defendants, Plaintiff allegedly secured a large, local California franchise as a client. Complaint ¶ 20. Plaintiff sold that client Paychex's Time and Attendance software, which allegedly helped the franchise become compliant with California's meal and rest break requirements, potentially saving thousands in penalties and fees. Id. Because Plaintiff allegedly originated the account and was influential in cultivating the business relationship with that client, Defendants allegedly made Plaintiff the representative for this account. Id. Plaintiff alleges that he was entitled to a monthly commission of at least $4000 per month per location, and that the chain to which the franchise belonged had more than 1800 locations nationwide. Id. On December 4, 2019, Suzanne Ceballos, another employee of Defendants, told Plaintiff that Defendants wanted a national representative from Strategic Accounts, rather than Plaintiff, to oversee this account. Id. ¶ 21. As a result, Defendants allegedly removed Plaintiff from the account and allegedly failed to pay him the commissions owed to him for his prior work on the account. Id.

On December 9, 2019, Plaintiff e-mailed Scott Halperin, another employee of Defendants, stating that Defendants improperly removed him as the handling representative on the account described above, and requesting that Defendants pay Plaintiff a referral commission for 18 months from the start of the franchise's client agreement. Complaint ¶ 22. On December 11, 2019, Defendants terminated Plaintiff, claiming that Plaintiff submitted improper business expenses for reimbursement. Id. It is also alleged that all of Plaintiff's business expense reports were approved by his manager and a corporate representative. Id.

It is alleged that Defendants also terminated two other individuals, who like Plaintiff, were over the age of 40 for allegedly submitting improper business expenses. Complaint ¶ 23. It is further alleged that, around the same time, Defendants investigated two other employees, both under the age of 30, for submitting improper business expenses and that Defendants did not terminate these two employees. Id. ¶ 24. Instead, it is alleged that Defendants permitted at least one of them to pay back the amounts at issue. Id. Plaintiff alleges that he was never told that his business expenses were improper and that he was never given an opportunity to pay back any allegedly improper expenses. Id. Plaintiff alleges that, after he was terminated, all the remaining Major Market Sales Representatives were under the age of 40 and that all of them failed to meet sales objectives. Id. ¶ 25.

On May 19, 2020, Plaintiff filed a timely complaint with the Department of Fair Employment and Housing and thereafter received a right to sue letter. Complaint ¶ 17. On December 3, 2020, Plaintiff filed amended his complaint. Id.

B. Plaintiff's 30(b)(6) Deposition Notice

On May 11, 2022, Plaintiff noticed the deposition of Paychex North America, Inc. pursuant to Fed. R. Civ. P. 30(b)(6). Dkt. 57-2 at 89-94. The notice of deposition identified the following topics:

Dkt. 57-2 at 90-94. A virtually identical notice of deposition was served on Paychex North America, Inc. on July 5, 2022. Id. at 130.

On October 19, 2022, Plaintiff moved to compel the deposition of Paychex North America, Inc. and certain other depositions. Dkt. 57. On November 21, 2022, Judge McDermott directed the parties to meet and confer further and to file a status report regarding the depositions. Dkt. 63. The parties timely filed a status report. Dkt. 65.

*5 On December 20, 2022, the parties filed a further status report regarding the unresolved discovery issues in this matter. Dkt. 67. On January 3, 2023, Defendants were ordered to provide a schedule by January 6, 2023 for the depositions of all remaining individuals. Dkt. 69. At the same time, a further joint status report regarding the depositions was ordered and a deadline was set for the completion of the depositions. Id. Defendants timely filed a schedule of depositions. Dkt. 70.

On January 9, 2023, Plaintiff re-noticed the deposition of Paychex North America, Inc., and added two new topics:

Dkt. 86-2. An identical notice was served again on February 1, 2023. Dkt. 82-1 at 58-59.

On February 17, 2023, Judge McDermott allowed the parties additional time to complete the remaining 30(b)(6) deposition topics, recognizing “the broad scope and number of the 30(b)(6) deposition topics and difficulties due to witnesses who are no longer Defendants' employees” but stating that no further extensions would be available. Dkt. 75.

C. The Discovery Orders

On March 24, 2023, the parties filed a further joint status report regarding the depositions in this case. Dkt. 82. In that filing Plaintiff argued that Defendants had failed to comply with Judge McDermott's prior orders. Id. at 2.

Judge McDermott determined that, for three reasons, further action in response to this joint status report was not appropriate. Dkt. 84 at 1. First, he found that “Defendants Paychex, Inc. and Paychex North America, Inc. have substantially complied with” his prior orders. Id. He noted that Defendants have produced “most pertinently Rule 30(b)(6) witnesses on 33 of 42 topics.” Id. He also observed that, although “[t]he process was made difficult by the fact certain employees had left the company or were in different time zones,” Defendants had produced “numerous of these witnesses.” Id. Second, Judge McDermott determined that Plaintiff had waived his right to take certain 30(b)(6) depositions. Plaintiff's counsel “represented he was not available for numerous dates that he earlier indicated were available” and “declined taking a deposition at 8 am.” Id. Judge McDermott found that “Plaintiff cannot claim injury if he was offered the opportunity to depose 30(b)(6) witnesses but chose not to do so.” Id. Third, Plaintiff had not been prejudiced by any failure on the part of Defendants to produce 30(b)(6) witnesses. The witnesses who were deposed “provided testimony on expense reimbursement procedures[,] investigations of expenses and disciplinary decisions, in regard to the topics at issue.” Id. Also, “Plaintiff filed his motion for summary judgment ... notwithstanding the remaining 30(b)(6) topics” and “did not seek an extension of the schedule from the District Judge to conduct further 30(b)(6) depositions.” Id. at 2.

III. Analysis

A. Legal Standards

Fed. R. Civ. P. 72(a) governs the review of a non-dispositive ruling by a magistrate judge. It provides that “[t]he district judge in the case must consider timely objections and modify or set aside any part of the order that is clearly erroneous or contrary to law.” Fed. R. Civ. P. 72(a); 28 U.S.C. § 636(b)(1)(A); see also United States v. Abonce-Barrera, 257 F.3d 959, 969 (9th Cir. 2001) (“[T]he magistrate judge's decision in ... nondispositive matters is entitled to great deference by the district court.”).

*6 The standard that applies in reviewing a finding of fact is whether there was “clear error” by the magistrate judge; it is not whether the district judge would have made a different determination based on the same evidence. Anderson v. City of Bessemer, 470 U.S. 564, 573 (1985). A factual finding by a magistrate judge is “clearly erroneous” only when the reviewing court is “left with the definite and firm conviction that a mistake has been committed.” United States v. Hinkson, 585 F.3d 1247, 1260 (9th Cir. 2009) (en banc) (internal quotation marks omitted).

The determination of legal issues by a magistrate judge is reviewed de novo, under the “contrary to law” standard. See China Nat. Metal Products Import/Export Co. v. Apex Digital, Inc., 155 F. Supp. 2d 1174, 1177 (C.D. Cal. 2001).

As to certain non-dispositive decisions by a magistrate judge, a district judge is to apply an even more deferential abuse-of-discretion standard. For example, in reviewing a ruling on a discovery dispute, a district judge will review a magistrate's order “ ‘with an eye toward the broad standard of relevance in the discovery context. Thus, the standard of review in most instances is not the explicit statutory standard, but the clearly implicit standard of abuse of discretion.’ ” Wolpin v. Philip Morris Inc., 189 F.R.D. 418, 422 (C.D. Cal. 1999) (quoting Geophysical Sys. Corp. v. Raytheon Co., Inc., 117 F.R.D. 646, 647 (C.D. Cal. 1987)); see also Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3069 n.22 (collecting decisions holding that certain orders by magistrate judges in the discovery context are subject to abuse-of-discretion review). In particular, “[t]he court should not disturb the magistrate's relevance determination except where it is based on ‘an erroneous conclusion of law or where the record contains no evidence on which [the magistrate] rationally could have based that decision.’ ” Equal Emp. Opportunity Comm'n v. Peters' Bakery, 301 F.R.D. 482, 484–85 (N.D. Cal. 2014) (quoting Wolpin, 189 F.R.D. at 422). “The implicit abuse of discretion standard does not apply to portions of a magistrate judge's discovery order not concerned with relevance.” Id.

“In its notice or subpoena, a party may name as the deponent a public or private corporation ... and must describe with reasonable particularity the matters for examination.” Fed. R. Civ. P. 30(b)(6). Then, “[t]he named organization must 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.” Id. “The persons designated must testify about information known or reasonably available to the organization.” Id.

B. Application

Plaintiff contends that Topics 10, 19, 20, 21, 23, 24, 28, 29, 30, 35, 38, 39, 43 and 44 remain at issue because insufficient testimony has been provided. Plaintiff's Supplemental Brief at 1.

In this matter, the cut-off for non-expert discovery was set for January 31, 2023. Dkt. 56 at 1. The deadline to file all motions, including discovery motions, was set for March 13, 2023. Id. at 2. Because this Motion was not filed until April 13, 2023, Plaintiff begins by requesting a modification of the scheduling order to permit the filing of this Motion. However, “[o]nce [a] district court ha[s] filed a pretrial scheduling order pursuant to Federal Rule of Civil Procedure 16 which established a timetable for amending pleadings that rule's standards control[ ].” Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 607–08 (9th Cir. 1992). Under the Rule 16 standard, a scheduling order may be modified “only for good cause ....” Fed. R. Civ. P. 16(b)(4). “Rule 16(b)'s ‘good cause’ standard primarily considers the diligence of the party seeking the amendment.” Johnson, 975 F.2d at 609. Thus, a district court “may modify the pretrial schedule ‘if it cannot reasonably be met despite the diligence of the party seeking the extension.’ ” Id. (quoting Fed. R. Civ. P. 16 advisory committee's notes (1983 amendment)). “If the party seeking the modification ‘was not diligent, the inquiry should end’ and the motion to modify should not be granted.” Zivkovic v. S. California Edison Co., 302 F.3d 1080, 1087 (9th Cir. 2002) (quoting Johnson, 975 F.2d at 609).

*7 Plaintiff has not made an adequate showing of diligence as to Topics 10, 19-21, 43 and 44, but Plaintiff has done so as to the other topics. On February 16, 2023, Plaintiff stated that the outstanding topics for which “Defendants failed to produce a Rule 30(b)(6) representative” were Topics “18, 23, 24, 28, 29, 30, 34, 35, 36, 37, 38 and 39.” Dkt. 73 at 7. By that time, non-expert discovery had closed, and Plaintiff knew, or should have known, the topics for which Defendants had failed to designate a 30(b)(6) representative. Although Plaintiff originally sought to compel deposition testimony on all topics then pending, see Dkt. 57-1 at 8, Plaintiff failed to notify Judge McDermott that these topics remained outstanding after the close of fact discovery. Subsequently, after removing Topics 10, 19-21, 43, and 44 as disputed ones for which relief was sought, Plaintiff identified these topics again only on March 24, 2023. This was after the deadline to file all discovery motions. Dkt. 82 at 6-7.

Plaintiff has not provided any reason why he could not have raised these issues after the close of fact discovery, and before the March 17, 2023 deadline. Because Plaintiff had reasonable opportunities to present these issues to Judge McDermott before the deadline, but failed to do so, he cannot show good cause to amend the scheduling order now. Therefore, the Motion will not be considered as to those topics. As to the other topics, Plaintiff has shown reasonable diligence. He first noticed these topics nearly a year ago, on May 11, 2022. Dkt. 57-2 at 94. He moved to compel Paychex North America, Inc.'s 30(b)(6) deposition almost six months before the deadline to file discovery motions. Dkt. 57. Defendants pledged to locate a representative on “each topic” but failed to do so, Dkt. 73 at 10, so Plaintiff repeatedly sought relief from Judge McDermott. See Dkt. 65; Dkt. 67; Dkt. 72; Dkt. 73; Dkt. 82. Finally, the Discovery Orders were issued on March 30, 2023, so Plaintiff logically could not have sought review of the Discovery Orders by March 17, 2023. See Dkt. 84; Dkt. 85. Once the Discovery Orders were issued, Plaintiff filed this Motion within two weeks. Compare Dkt. 85 with Dkt. 86.

Courts have the power to grant protective orders with respect to 30(b)(6) topics that are overbroad. See Fed. R. Civ. P. 26(c); see also McArthur v. Rock Woodfired Pizza & Spirits, 318 F.R.D. 136, 143 (W.D. Wash. 2016); Brown v. West Corp., 287 F.R.D. 494, 505 (D. Neb. 2012); Innomed Labs., LLC v. Alza Corp., 211 F.R.D. 237, 240 (S.D.N.Y. 2002); In re Indep. Serv. Orgs. Antitrust Litig., 168 F.R.D. 651, 654 (D. Kan. 1996). Although Defendants have not expressly moved for a protective order, they have repeatedly stated their position that certain of the topics are overbroad. They did so in briefs submitted to Judge McDermott and this Court. See, e.g., Dkt. 73 at 9.

It is determined that two of the remaining topics – Topics 38 and 39 – are overbroad. Topic 38 covers all of Defendants' responses to Plaintiff's interrogatories and Requests for Production; Topic 39 covers all the documents produced by Defendants. Therefore, Plaintiff has failed to “describe with reasonable particularity the matters for examination” with respect to these topics, and Plaintiff is not entitled to further relief on these issues. Fed. R. Civ. P. 30(b)(6). However, Topics 23, 24, 28, 29, 30 and 35 are not overbroad. Both Topics 23 and 24 pertain to the specific Jersey Mike's account on which Plaintiff worked. Similarly, Topics 28, 29, 30 and 35 are about the investigation and/or termination of a relatively small group of employees who were allegedly investigated and/or terminated based on accusations like those leveled against Plaintiff.

The remaining topics are Topics 23, 24, 28, 29, 30 and 35. In the Discovery Orders, it was stated that “Plaintiff cannot claim injury if he was offered the opportunity to depose 30(b)(6) witnesses but chose not to do so.” Dkt. 84 at 1. As to Topics 23 and 24, this reasoning is persuasive. Defendants offered to produce a 30(b)(6) representative with respect to these issues on March 16, 2023, a date Plaintiff's counsel had previously stated availability. See Dkt. 82-1 at 16-20, 52. Although Defendants waited a few weeks before proposing that date, Plaintiff filled his schedule with other matters without following up with counsel for the Defendants or seeking an extension of time. Id. Therefore, the finding in the Discovery Orders that Plaintiff failed to act with reasonable diligence is not clearly erroneous. However, unlike Topics 23 and 24, Defendants do not claim that they ever offered to designate a 30(b)(6) representative on Topics 28, 29, 30 and 35. See Defendants' Supplemental Brief at 4. To the extent the Discovery Orders concluded that Plaintiff had waived his right to take a 30(b)(6) deposition with respect to these matters, it was clearly erroneous.

*8 With respect to the four remaining topics, Topics 28, 29, 30 and 35, the Discovery Orders determined that Defendants had substantially complied with their discovery obligations because many of the individuals with the most knowledge of the relevant facts were no longer employed by Defendants. This is contrary to law. “[T]he duty to present and prepare a Rule 30(b)(6) designee goes beyond matters personally known to that designee or to matters in which that designee was personally involved.” Brazos River Auth. v. GE Ionics, Inc., 469 F.3d 416, 433 (5th Cir. 2006) (quotation omitted). Rather, “[t]he deponent must prepare the designee to the extent matters are reasonably available, whether from documents, past employees, or other sources.” Id. Thus, that Defendants no longer have access to certain evidence does not excuse them from their obligation to designate a 30(b)(6) witness on that subject. Instead, Defendants must prepare a 30(b)(6) designee, even one without personal knowledge of the issues, using the evidence that is reasonably available. “If the persons designated by the corporation do not possess personal knowledge of the matters set out in the deposition notice, the corporation is obligated to prepare the designees so that they may give knowledgeable and binding answers for the corporation.” United States v. Taylor, 166 F.R.D. 356, 361 (M.D.N.C. 1996), aff'd, 166 F.R.D. 367 (M.D.N.C. 1996); see also Schnatter v. 247 Grp., LLC, 343 F.R.D. 325, 331 (W.D. Ky. 2022) (“When a corporation is served with a notice of a Rule 30(b)(6) deposition, it is obligated to produce a witness or witnesses knowledgeable about the subject or subjects described in the notice and to prepare the witness or witnesses to testify not simply to their own knowledge, but the knowledge of the corporation.”). Similarly, that some of the individuals Defendants wished to designate live in different time zones does not excuse Defendants from their obligations.

Finally, the conclusion in the Discovery Orders that Plaintiff suffered no prejudice by his inability to depose 30(b)(6) representatives on Topics 28, 29, 30 and 35 is clearly erroneous. These topics cover Defendants' decisions to investigate and/or discipline certain employees for submitting improper business expenses. Plaintiff claims that this evidence will show that employees over the age of 40 were investigated and terminated for engaging in certain conduct, whereas employees under that age were either not investigated or not terminated. In the Complaint, Plaintiff primarily relies on this alleged discrepancy to support his claims that he was terminated because of his age rather than his alleged misconduct. Plaintiff was able to depose other witnesses regarding the subject matter of Topics 28, 29, 30 and 35. However, “[p]rior deposition testimony from individual fact witnesses does not ordinarily relieve a corporation from designating a Rule 30(b)(6) witness because of two key differences between them: Rule 30(b)(6) witnesses bind the entity they are representing and are responsible for providing all information known or reasonably available to the entity.” Schnatter, 343 F.R.D. at 333.

Defendants have not shown that this is one of those extraordinary cases where prior deposition testimony from a fact witness obviates the need for testimony under Fed. R. Civ. P. 30(b)(6). The Discovery Order noted that “Plaintiff filed his motion for summary judgment ... notwithstanding the remaining 30(b)(6) topics” and “did not seek an extension of the schedule from the District Judge to conduct further 30(b)(6) depositions.” Dkt. 84 at 2. However, this does not establish the absence of prejudice. Even if Plaintiff felt he had sufficient evidence without this 30(b)(6) testimony to move for summary judgment on Defendant's affirmative defenses, the testimony could still support Plaintiff's motion for summary judgment. Even if Plaintiff's motion were deemed evidence that he was not prejudiced with respect to Defendant's affirmative defenses, he would still be prejudiced with respect to his efforts to oppose Defendant's motion for summary judgment on Plaintiff's claims and his efforts to prepare for any trial. For these reasons, the Discovery Orders are reversed with respect to Topics 28, 29, 30 and 35.

It is determined that sanctions are not appropriate at this time; provided, however, non-compliance with this Order may result in the issuance of an Order to Show Cause why sanctions should not be imposed.

IV. Conclusion

For the reasons stated in this Order, the Motion is GRANTED IN PART and DENIED IN PART. Defendants shall designate 30(b)(6) representative(s) to testify with respect to Topics 28, 29, 30 and 35. For the limited purpose of obtaining this testimony, the cutoff for non-expert discovery is extended to June 23, 2023. The hearing on the parties' pending Motions for Summary Judgment is continued from June 12, 2023 to July 10, 2023. On or before June 26, 2023, Plaintiff shall file a supplemental brief not to exceed five pages stating the claimed effect of the 30(b)(6) deposition testimony, if any, on the pending Motions for Summary Judgment. On or before June 28, 2023, Defendants shall file a supplemental brief of the same length on the same subject. The parties shall work together collaboratively to complete these depositions efficiently.

*9 IT IS SO ORDERED.