Duke Energy Carolinas, LLC v. Ag Ins. sa/nv

Duke Energy Carolinas, LLC v. AG Ins. SA/NV, 2019 NCBC 73.

STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE

SUPERIOR COURT DIVISION

MECKLENBURG COUNTY 17 CVS 5594

DUKE ENERGY CAROLINAS, LLC

and DUKE ENERGY PROGRESS,

LLC,

Plaintiffs,

v. ORDER AND OPINION ON

JOINING DEFENDANTS’

AG INSURANCE SA/NV (f/k/a

L’Etoile S.A. Belge d’Assurances); et MOTION TO COMPEL DEPOSITIONS

al., OF LYNN GOOD AND DHIAA JAMIL

Defendants.

1. THIS MATTER is before the Court on the Joining Defendants’ 1 Motion to

Compel Depositions of Lynn Good and Dhiaa Jamil (the “Motion to Compel” or the

“Motion”) filed on October 18, 2019 in the above-captioned case. (ECF No. 513.)

Having considered the Motion, the materials submitted in support of and in

opposition to the Motion, the arguments of counsel at the November 12, 2019 hearing

on the Motion (the “Hearing”), and other appropriate matters of record, the Court

hereby GRANTS the Motion in part and DENIES the Motion in part.

Pillsbury Winthrop Shaw Pittman LLP, by Mark J. Plumer, Matthew G.

Jeweler, Barry Fleishman, Aaron D. Coombs, William C. Miller, and

Jeffrey W. Mikoni, and Hunton & Williams LLP, by A. Todd Brown and

Ryan G. Rich, for Plaintiffs Duke Energy Carolinas, LLC and Duke

Energy Progress, LLC.

1 Allianz Global Risks (f/k/a Allianz Insurance Company); Allianz Underwriters Insurance

Company (f/k/a Allianz Underwriters, Inc.); Arrowood Indemnity Company; Assurances

Generales de France; Century Indemnity Company, as successor to California Union

Insurance Company; Federal Insurance Company; Fireman’s Fund Insurance Company;

First State Insurance Company; General Reinsurance Corporation, as successor to North

Star Reinsurance Corporation; Generali IARD, as successor to Le Continent; Old Republic

Insurance Company; Pacific Employers Insurance Company; The Continental Insurance

Company for London Guarantee and Accident Company of New York; Twin City Fire

Insurance Company; and United States Fire Insurance Company.

Cohn Baughman & Martin, by Frank Slepicka, White and Williams,

LLP, by Shane Heskin and Sara Tilitz, and Fitzgerald Litigation, by

Andrew L. Fitzgerald, Lee Denton, and D. Stuart Punger, for Defendants

Century Indemnity Company, Federal Insurance Company, and Pacific

Employers Insurance Company.

Karbal Cohen Economou Silk Dunne LLC, by Dena Economou and

Gerald Ziebell, and Brooks, Pierce, McLendon, Humphrey & Leonard,

LLP, by D.J. O’Brien, III, for Defendants First State Insurance Company

and Twin City Fire Insurance Company.

Squire Patton Boggs (US) LLP, by Eridania Perez-Jaquez and Paul

Kalish, and McAngus, Goudelock & Courie, PLLC, by John T. Jeffries,

John Barringer, and Jeffrey Kuykendal, for Defendants Allianz Global

Risks US Insurance Company, Allianz Underwriters Insurance

Company, and Fireman’s Fund Insurance Company.

Freeborn & Peters LLP, by Bruce M. Engel, Patrick Frye, and Ryan G.

Rudich, and Bradley Arant Boult Cummings LLP, by Corby Cochran

Anderson and Matthew S. DeAntonio, for Defendant Arrowood

Indemnity Company.

Hogan Lovells US LLP, by Alexander B. Bowerman and David

Newmann, and McAngus, Goudelock & Courie, PLLC, by John T.

Jeffries, John Barringer, and Jeffrey Kuykendal, for Defendant

Assurances Generales de France.

Hinkhouse Williams Walsh LLP, by William C. Joern and Richard

McDermott, and Pope Aylward Sweeney & Stephenson, LLP, by Robert

Joseph Aylward, for Defendant Continental Insurance Company.

Saiber LLC, by Michael Balch and David I. Satine, and McAngus,

Goudelock & Courie, PLLC, by John T. Jeffries, John Barringer, and

Jeffrey Kuykendal, for Defendant General Reinsurance Corporation.

Gerber Ciano Kelly Brady, LLP, by Joanna M. Roberto, and Gallivan,

White & Boyd, P.A., by James M. Dedman, IV, for Defendant Generali

Iard S.A.

Clausen Miller P.C., by Ilene Korey, Michael L. Duffy, Amy R. Paulus,

and Teo Belli, and Fox Rothschild LLP, by Jeffrey P. MacHarg, for

Defendant Old Republic Insurance Company.

James, McElroy & Diehl, P.A., by Adam L. Ross, and Kennedys CMK

LLP, by Xavier Vergara and John D. LaBarbera, for Defendant United

States Fire Insurance Company.

Rivkin Radler LLP, by Alan S. Rutkin, George D. Kappus, Gregory

Mann, Steven Zuckermann, and Robert Tugander, and Goldberg

Segalla, by David G. Harris, II and David L. Brown, for Defendants

Associated Electric and Gas Insurance Services Ltd., Berkshire

Hathaway Direct Insurance Company, and TIG Insurance Company.

Windels Marx Lane & Mittendorf LLP, by Eric J. Konecke and Stefano

V. Calogero, and Hamilton Stephens Steele & Martin, PLLC, by Aaron

Lay and Keith Merritt, for Defendant Allstate Insurance Company.

Jackson & Campbell PC, by Erin N. McGonagle and Cristopher M.

Quinlan, and Butler Weihmuller Katz Craig, by T. Nicholas Goanos and

L. Andrew Watson, for Defendants AIG Property Casualty Company,

American Home Assurance Company, and Lexington Insurance

Company.

Bledsoe, Chief Judge.

I.

FACTUAL AND PROCEDURAL BACKGROUND

2. This action focuses on whether Defendants—all insurers who issued excess

level insurance policies to Duke or its predecessors—are obligated to compensate

Duke for alleged liabilities linked to coal combustion residuals, i.e., coal ash, at

certain Duke-owned power plants in North and South Carolina.

3. On September 27, 2019, the Joining Defendants submitted a dispute

summary under Business Court Rule (“BCR”) 10.9 seeking to compel the depositions

of Lynn Good (“Ms. Good”), the current President and Chief Executive Officer (“CEO”)

and former Chief Financial Officer (“CFO”) of Plaintiffs Duke Energy Carolinas, LLC

and Duke Energy Progress, LLC (together, “Duke”), and Dhiaa Jamil (“Mr. Jamil”),

Duke’s current Chief Operating Officer (“COO”) (the “Executive Depositions Dispute”

or the “Dispute”).

4. On October 4, 2019, the Court held a BCR 10.9 telephone conference (the

“Conference”) on the Executive Depositions Dispute and thereafter issued a

Scheduling Order setting a timeline for the Joining Defendants to file a motion to

compel concerning the Dispute and for the parties to file briefs and evidence in

support of and in opposition to the permitted motion. (ECF No. 507.)

5. On October 18, 2019, the Joining Defendants filed the Motion to Compel

with over 2,000 pages of supporting exhibits and testimony. 2 The Joining Defendants

contend that the Court should permit the depositions of Ms. Good and Mr. Jamil

because Duke’s strategy and actions regarding coal plant closure and coal ash

remediation are critical, relevant issues in this litigation and Ms. Good and Mr. Jamil

were both “decision-makers with ultimate responsibility for shaping Duke’s overall

coal ash strategy,” including how Duke intended to pay for the costs required to close

Duke’s coal ash ponds. (Redacted Joining Defs.’ Mem. of Law Supp. Mot. to Compel

Deps. of Lynn Good & Dhiaa Jamil 1–2 [hereinafter “Redacted Joining Defs.’ Mem.

Supp. Mot. to Compel”].)

6. The Joining Defendants argue, in particular, that Ms. Good and Mr. Jamil

each possess unique, personal, and relevant knowledge concerning (i) Duke’s plans to

close its coal ash ponds in the years before a 2014 coal ash spill at Duke’s Dan River

2 The Joining Defendants filed under seal their exhibits and brief in support of their Motion

to Compel. (ECF Nos. 513, 514.) The references to those exhibits and brief in this Order are

to the redacted, public versions. (ECF Nos. 520.2–520.10, 520.1.)

plant (the “Dan River Spill”) and the subsequent enactment of North Carolina’s Coal

Ash Management Act (“CAMA”), (ii) Duke’s strategies and voluntary commitments

in response to the Dan River Spill prior to the enactment of CAMA, (iii) Duke’s pre-

CAMA plans and cost estimates for the closure of Duke’s coal ash ponds, (iv) Duke’s

alleged failure to act on coal ash remediation and plant closure plans presented by

Mr. Jamil to Ms. Good and Duke’s Board of Directors in 2010, and (v) whether Duke

“expected or intended the alleged property damage” at its coal ash sites through its

ash pond design. (Redacted Joining Defs.’ Mem. Supp. Mot. to Compel 3.)

7. The Joining Defendants assert that these issues are directly relevant to

their defenses to Duke’s claims for coverage, including that Duke (i) improperly seeks

an insurance recovery for ordinary business costs, (ii) made voluntary commitments

before CAMA was enacted such that CAMA cannot have triggered Duke’s coal ash

liabilities as Duke alleges, (iii) has brought this action after the relevant statute of

limitations has expired, (iv) has failed to mitigate its damages, and (v) has failed to

assert a fortuitous claim. (Redacted Joining Defs.’ Mem. Supp. Mot. to Compel 3.)

8. The Joining Defendants contend that Ms. Good has unique, personal, and

relevant knowledge based on her direct involvement in (i) Duke’s strategic decisions

and actions following the Dan River Spill, (ii) Duke’s ash pond closure plans and

related costs, (iii) Duke’s voluntary commitments to North Carolina’s then-Governor

Pat McCrory in a March 2014 public letter, (iv) Duke’s alleged involvement in the

development and passage of CAMA, (v) Duke’s creation of a new team to implement

Duke’s coal ash strategy, and (vi) Duke’s SEC reporting, which she approved after

formerly serving as Duke’s CFO. (Redacted Joining Defs.’ Mem. Supp. Mot. to

Compel 4–8.) The Joining Defendants also seek to depose Ms. Good about statements

she made in interviews, including that “[a]sh pond closure has been a plan for a very

long time” and that Duke “[has] been storing ash for nine decades[,]” as well as

statements she made in an e-mail to a Duke shareholder that any seepage at Duke’s

Riverbend plant was “extremely small” and that Duke was “committed to closing ash

basins at Riverbend and our other retired plants in a safe way that alleviates seepage

and further protects water quality.” (Redacted Joining Defs.’ Mem. Supp. Mot. to

Compel 5, 8–9.)

9. The Joining Defendants argue that Mr. Jamil has unique, personal, and

relevant knowledge due to his “deep involvement” with Duke’s coal ash pond closure

plans beginning in 2009, before both the Dan River Spill and the passage of CAMA,

and his several presentations to Duke’s Board of Directors on closure plans and

projected costs. (Redacted Joining Defs.’ Mem. Supp. Mot. to Compel 9.) The Joining

Defendants also argue that Mr. Jamil’s opportunity to present to the Board of

Directors gave him insight into “what was reported to the decision-makers, questions

asked, choices made, and the reasons why” both before and after the Dan River Spill

through 2016. (Redacted Joining Defs.’ Mem. Supp. Mot. to Compel 9–11.)

10. Duke filed its opposition brief on November 4, 2019. (ECF No. 525.) Duke

contends that Ms. Good and Mr. Jamil—Duke’s two most senior executives—do not

possess unique, relevant knowledge, that the burdens attendant to their depositions

as the CEO and COO of a Fortune 150 company far outweigh any alleged benefit to

the Joining Defendants, and that other Duke current and former employees who have

been and will be deposed have provided or will “provide ample opportunity for

discovery” regarding the coal ash matters on which the Joining Defendants seek

information through the requested depositions. (Duke’s Br. Opp’n to Joining Defs.’

Mot. to Compel Deps. of Lynn Good & Dhiaa Jamil 1–4, 12 [hereinafter “Duke’s Br.

Opp’n to Joining Defs.’ Mot. to Compel”].)

11. Duke advances numerous specific challenges to the Joining Defendants’

grounds for deposing both Ms. Good and Mr. Jamil. As to Ms. Good, Duke argues

that any testimony concerning the Dan River Spill and its aftermath is irrelevant

because Duke is not seeking coverage for any such costs in this litigation. 3 (Duke’s

Br. Opp’n to Joining Defs.’ Mot. to Compel 6.) Further, Duke contends that Ms. Good

does not have unique knowledge concerning Duke’s coal ash storage plans following

the Dan River Spill because she delegated that review to others or concerning the

2014 public letter to Governor McCrory because that letter was prepared by Duke’s

counsel. (Duke’s Br. Opp’n to Joining Defs.’ Mot. to Compel 6–7.) Duke also contends

that while Ms. Good signed a letter sent to Duke’s Board of Directors regarding the

creation of Duke’s Ash Basin Strategic Action Team (“ABSAT”) after the Dan River

3 The Joining Defendants appear to agree, representing at the Hearing that “the issue here

is not about Dan River and the clean-up of Dan River and all of that. It’s what Duke, at the

very top of the company, did with respect to all of its ash basins in the – in the aftermath of

Dan River.” (Nov. 12, 2019 Hearing Tr. 17; see also Nov. 12, 2019 Hearing Tr. 18 (“And the

crisis has two aspects to it. One is the Dan River spill itself. Stopped the spill – I mean,

stopped the leaking material into the river, addressed that issue, addressed the – the damage

to the Dan River, addressed all of those parts of it. And they were all over that. Ms. Good

was all over that. But that’s not what we are asking her for – asking for her deposition for,

or Mr. Jamil.”).)

Spill, others who have been or will be deposed are better qualified to address issues

related to ABSAT. Duke also contends that Ms. Good did not attend a meeting

concerning potential legislation that the Joining Defendants have indicated they wish

to examine her about. (Duke’s Br. Opp’n to Joining Defs.’ Mot. to Compel 7–8.) As to

her public and e-mail statements, Duke argues that Ms. Good does not have unique

knowledge merely by making “passing references to public information” regarding

coal ash storage and that the subject of the e-mail communication at issue—water

seepage in earthen dams—is not at issue in this case. (Duke’s Br. Opp’n to Joining

Defs.’ Mot. to Compel 9–10.)

12. As to her potential testimony concerning Duke’s SEC reporting of coal ash

matters, including, in particular, the classification of Duke’s coal ash remediation

costs as “asset retirement obligations” (“AROs”), Duke argues that the process

through which its attorneys draft 10-K reports, which are, as here, later verified by

executives like Ms. Good, does not establish the executive’s (or here Ms. Good’s)

unique knowledge of Duke’s accounting classifications. (Duke’s Br. Opp’n to Joining

Defs.’ Mot. to Compel 9.) Moreover, Duke represents that the former Duke employee

with the most specific knowledge concerning Duke’s ARO classification was

scheduled for deposition on November 18, 2019 and that Duke has agreed to provide

a Rule 30(b)(6) witness on this topic. (Duke’s Br. Opp’n to Joining Defs.’ Mot. to

Compel 9.)

13. As to Mr. Jamil, Duke disputes that he has unique knowledge concerning

Duke’s coal ash matters and asserts that the evidence presented by the Joining

Defendants shows only that Mr. Jamil had “high-level ownership” of the coal ash

issue prior to the Dan River Spill. (Duke’s Br. Opp’n to Joining Defs.’ Mot. to Compel

10–11.) Duke argues that pre-Dan River Spill coal ash matters would be better and

more completely addressed by Duke witnesses who have already been deposed or will

be deposed. (Duke’s Br. Opp’n to Joining Defs.’ Mot. to Compel 11–12.)

14. On November 12, 2019, the Court held a hearing on the Motion to Compel.

Because the Joining Defendants focused their arguments at the Hearing on a subset

of the 2,000+ documents they submitted in connection with the Motion, a subset not

disclosed to Duke until the night before the Hearing, the Court permitted Duke an

opportunity to file a supplemental brief addressing those documents. (ECF No. 540.)

Duke filed its supplemental brief on November 27, 2019. (ECF No. 600.)

15. The Motion is now ripe for resolution.

II.

LEGAL STANDARD

16. Under North Carolina Rule of Civil Procedure 26 (“Rule 26”), a liberal scope

of discovery allows parties to obtain discovery “regarding any matter, not privileged,

which is relevant to the subject matter involved in the pending action[,]” even if the

information sought will be inadmissible at trial or the examining party already has

knowledge of the information sought. N.C. R. Civ. P. 26(b)(1). The relevancy test for

discovery differs from the “stringent test” required for admissibility at trial. Willis v.

Duke Power Co., 291 N.C. 19, 34, 229 S.E.2d 191, 200 (1976). “To be relevant for

purposes of discovery, the information sought need only be ‘reasonably calculated’ to

lead to the discovery of admissible evidence.” Shellhorn v. Brad Ragan, Inc., 38 N.C.

App. 310, 314, 248 S.E.2d 103, 106 (1978); see also N.C. R. Civ. P. 26(b)(1); Gay v.

Peoples Bank, 2014 NCBC LEXIS 46, at *5 (N.C. Super. Ct. Sept. 17, 2014) (citation

omitted).

17. When a motion to compel discovery is filed, “[t]he party resisting discovery

bears the burden of showing why the motion to compel should not be granted[,]”

Transatlantic Healthcare, LLC v. Alpha Constr. of the Triad, Inc., 2017 NCBC LEXIS

21, at *37 (N.C. Super. Ct. Mar. 9, 2017) (citation omitted), and must make a

“particularized showing” rather than rely upon “conclusory or generalized

statements[,]” Nat’l Fin. Partners Corp. v. Ray, 2014 NCBC LEXIS 50, at *26 (N.C.

Super. Ct. Oct. 13, 2014) (quoting Smithfield Bus. Park, LLC v. SLR Int’l Corp., No.

5:12-CV-282-F, 2014 U.S. Dist. LEXIS 110535, at *7 (E.D.N.C. Aug. 11, 2014)).

Deciding whether to grant or deny a motion to compel discovery “is within the trial

court’s sound discretion and will not be reversed absent an abuse of discretion.”

Sessions v. Sloane, 248 N.C. App. 370, 381, 789 S.E.2d 844, 853–54 (2016) (citation

omitted).

18. The Court may also limit discovery on its own initiative if it finds that:

(i) the discovery sought is unreasonably cumulative or duplicative, or is

obtainable from some other source that is more convenient, less

burdensome, or less expensive; (ii) the party seeking discovery has had

ample opportunity by discovery in the action to obtain the information

sought; or (iii) the discovery is unduly burdensome or expensive, taking

into account the needs of the case, the amount in controversy,

limitations on the parties’ resources, and the importance of the issues at

stake in the litigation.

N.C. R. Civ. P. 26(b)(1a).

19. Under Rule 26, “[o]ne party’s need for information must be balanced against

the likelihood of an undue burden imposed upon the other.” Willis, 291 N.C. at 34,

229 S.E.2d at 200.

III.

LEGAL ANALYSIS

20. The parties cite to this Court’s prior rulings in Next Advisor Continued, Inc.

v. LendingTree, Inc., 2016 NCBC LEXIS 72 (N.C. Super. Ct. Sept. 16, 2016), and

Bradshaw v. Maiden, 2017 NCBC LEXIS 30 (N.C. Super. Ct. March 31, 2017), to

support their positions on the Motion. Both Next Advisor and Bradshaw reference

the “apex doctrine,” a federal doctrine not formally adopted by North Carolina state

courts, under which a trial court may, in its discretion, limit discovery sought from

top corporate executives. See Bradshaw, 2017 NCBC LEXIS 30, at *6–10 (discussing

doctrine); Next Advisor, 2016 NCBC LEXIS 72, at *6–10 (same).

21. Various federal courts have noted that the apex doctrine serves as an aid to

“ensur[e] that the liberal rules of procedure for depositions are used only for their

intended purpose and not as a litigation tactic to create undue leverage by harassing

the opposition or inflating its discovery costs.” Bradshaw, 2017 NCBC LEXIS 30, at

*7–8 (quoting Performance Sales & Mktg. LLC v. Lowe’s Cos., Inc., No. 5:07-CV-

00140-RLV-DLH, 2012 U.S. Dist. LEXIS 131394, at *16 (W.D.N.C. Sept. 14, 2012)).

“In its stronger form, the doctrine holds that, before a plaintiff may depose a

defendant corporation’s high-ranking (“apex”) officer, that plaintiff must show that

‘(1) the executive has unique or special knowledge of the facts at issue and (2) other

less burdensome avenues for obtaining the information sought have been

exhausted.’ ” Performance Sales & Mktg. LLC, 2012 U.S. Dist. LEXIS 131394, at

*16–17 (citation omitted).

22. In this case, as in Next Advisor and Bradshaw, the Court declines to adopt

the federal apex doctrine, finding that Rule 26 resolves the current dispute

concerning the depositions of Ms. Good and Mr. Jamil. As in those cases, however,

the Court will consider federal decisions interpreting the apex doctrine in applying

Rule 26’s balancing factors. See Bradshaw, 2017 NCBC LEXIS 30, at *9; Next

Advisor, 2016 NCBC LEXIS 72, at *6–10; see also Turner v. Duke Univ., 325 N.C.

152, 164, 381 S.E.2d 706, 713 (1989) (“Decisions under the federal rules are . . .

pertinent for guidance and enlightenment in developing the philosophy of the North

Carolina rules.”).

23. In Next Advisor, the Court found that the defendant’s CEO had “unique,

personal knowledge relevant to the issues in dispute” and allowed his deposition to

proceed primarily because the CEO negotiated the failed corporate acquisition at

issue in that case and his conduct and representations were directly relevant and

material to the asserted claims. 2016 NCBC LEXIS 72, at *11–12. In contrast, in

Bradshaw, the Court did not permit the deposition of the defendant’s President and

COO because that high-level executive had no involvement of any kind in the

disputed matter other than to sign the contract at issue pursuant to company policy.

2017 NCBC LEXIS 30, at *2, 14–15. The level of involvement of Ms. Good and Mr.

Jamil in the matters at issue in this litigation appears to fall somewhere in between

these two paradigmatic extremes of chief executive involvement in the underlying

dispute.

24. Here, the evidence appears quite clear that coal plant closure and coal ash

remediation are and have been highly significant issues facing Duke. The evidence

presented shows that Duke’s CEO, COO, senior management, and Board of Directors

have devoted substantial time and attention to these issues over the years, and, in

particular, over the past decade. At this stage of the proceedings, and based on the

argument and evidence before the Court, it appears to the Court at this time that

Duke’s pre-Dan River Spill and post-Dan River Spill strategies, plans, and activities

concerning coal plant closures and coal ash remediation, as well as any Duke

involvement in the creation and passage of CAMA, are relevant to the Joining

Defendants’ defenses in this litigation. Duke appears to largely agree for purposes of

discovery, advancing an objection on relevance grounds only as to Ms. Good’s

involvement in Duke’s follow up in the wake of the Dan River Spill. (See Duke’s Br.

Opp’n to Joining Defs.’ Mot. to Compel 6.)

25. Based on the Court’s review of the briefing, argument, and evidence on the

Motion, it appears that Ms. Good and Mr. Jamil have each had significant

involvement in analyzing, directing, and/or implementing Duke’s strategy and

decision-making concerning coal plant closures and coal ash remediation both before

and after the Dan River Spill. It is also clear that a number of lower-level Duke

executives have had significant, and in many instances greater, involvement in these

issues, and that many of these employees have been or will be deposed in this action.

In balancing burden versus benefit under Rule 26, however, courts have recognized

that the testimony of higher-level executives may have greater probative value than

that of lower-level employees concerning certain issues in certain circumstances and

that on certain matters the lower-level employee’s testimony is not an adequate

substitute for the testimony of the higher-level executive. See, e.g., Travelers Rental

Co. v. Ford Motor Co., 116 F.R.D. 140, 146 (D. Mass. 1987) (“[A]s the ultimate

authority, [higher-level executives’] views . . . may be of far greater probative value

on the issue of intent and motive than the views of the lower-level executives.”). The

Court concludes that such is the case here.

26. Here, the Joining Defendants seek testimony from Duke’s two highest-

ranking executives, each of whom was specifically involved in analyzing, directing,

and/or implementing Duke’s strategies and plans concerning issues of high corporate

significance that are central to the Joining Defendants’ defenses in the instant

litigation. While Duke argues that certain lower-level executives have testified, and

other lower-level executives will testify, to provide the same information sought from

Ms. Good and Mr. Jamil, the Court is persuaded by the evidence of record that Duke’s

testifying lower-level executives have not rendered, and will not render, testimony

from Ms. Good or Mr. Jamil unreasonably cumulative or duplicative on the Joining

Defendants’ identified topics of inquiry. Instead, based on its review of the evidence

of record, the Court concludes that Ms. Good and Mr. Jamil possess specific, unique

knowledge relevant to the Joining Defendants’ defenses in this litigation that is not

readily obtainable from any other less burdensome source.

27. As such, the Court finds this case much more like Next Advisor than

Bradshaw and concludes, in the exercise of its discretion, that the balancing required

under Rule 26 of the Joining Defendants’ need for the testimony sought against the

acknowledged burden imposed on Duke militates in favor of permitting the

depositions of Ms. Good and Mr. Jamil to proceed in these circumstances. See Willis,

291 N.C. at 34, 229 S.E.2d at 200 (balancing Rule 26 factors); Bradshaw, 2017 NCBC

LEXIS 30, at *9 (same); Next Advisor, 2016 NCBC LEXIS 72, at *12–13 (same).

28. Having reached this conclusion, however, the Court further concludes, in

the exercise of its discretion, that certain restrictions should be imposed on the

permitted depositions to reduce the burden on Ms. Good and Mr. Jamil as Duke’s top

corporate officers. See, e.g., Folwell v. Hernandez, 210 F.R.D. 169, 173–75 (M.D.N.C.

2002) (“Even when an executive does have personal knowledge about the case, the

court still may fashion a remedy which reduces the burden on the executive.”).

Specifically, the Court concludes, in the exercise of its discretion, that certain

restrictions as to time, location, capacity, scope, and duration are appropriate in these

circumstances.

29. Accordingly, the Court, in the exercise of its discretion, hereby ORDERS as

follows:

a. As to time and location, and consistent with the Court’s discussion with

the parties at the Hearing, the depositions of Ms. Good and Mr. Jamil

will each take place in Charlotte, North Carolina at Duke’s counsel’s

offices on an agreed-upon date between December 16, 2019 and January

15, 2020, and Duke and the Joining Defendants shall work cooperatively

to schedule each deposition at a convenient time for each witness.

b. As to capacity, Ms. Good and Mr. Jamil will each be deposed for purposes

of this Order in her or his individual capacity, not as a corporate

representative under North Carolina Rule of Civil Procedure 30(b)(6).

c. As to scope, the Joining Defendants may examine Ms. Good and Mr.

Jamil only on those topics identified at pages 3–11 in the Joining

Defendants’ brief in support of the Motion, except that the Joining

Defendants may not examine Ms. Good or Mr. Jamil concerning Duke’s

specific Dan River Spill-related costs or Duke’s SEC reporting of coal

ash matters, as the Court concludes that these issues, to the extent they

are relevant, are more appropriately discussed by Duke’s lower-level

executives and employees.

d. As to duration, based on the evidence presented, the forecasted areas of

deposition inquiry, the information obtained in depositions taken to date

and forecasted to be obtained in the remaining depositions to be taken

prior to the close of discovery, the burden to Ms. Good and Mr. Jamil as

Duke’s top officers, and the failure of the Joining Defendants to

articulate a persuasive reason at the Hearing why a full seven-hour

deposition of either executive is necessary to obtain the information

sought, the Court concludes that it is reasonable, appropriate, and

consistent with fairness and justice to limit each deposition to four (4)

hours of on-the-record examination by the Joining Defendants.

e. Nothing in this Order shall impair Duke’s right to invoke attorney-client

privilege, work-product immunity, or any other objection permitted

under the North Carolina Rules of Civil Procedure, as appropriate, at

either of the depositions permitted hereunder.

SO ORDERED, this the 6th day of December, 2019.

/s/ Louis A. Bledsoe, III

Louis A. Bledsoe, III

Chief Business Court Judge